Global Data Center Colocation Market Size, Share, Opportunities, And Trends By Colocation Model (Wholesale, Retail), By Enterprise Size (Small, Medium, Large), By End-User Industry (Communication And Technology, Manufacturing, Government, Healthcare, BFSI, Media And Entertainment, Others), And By Geography - Forecasts From 2023 To 2028

The global data center colocation market is estimated to grow at a CAGR of 15.56% to reach US$154,574.702 million in 2028 from US$56,1175.945 million in 2021.

The market is being driven by the increasing use of cloud services, which have taken a growing portion of data center usage. At the same time, colocation or in-house systems have maintained a somewhat constant supply.

As the increasing applications of 5G, wearable devices, the Internet of Things, and artificial intelligence continue to create a booming need for processing capacity; larger enterprises are looking to scale out their data centers to ensure the stability and dependability of data services. The trend is visible across the world. For instance, as per JLL, a global real estate firm, India's colocation data center industry is expected to double by the end of 2023.

The colocation of data centers is being fueled by as many public sector organizations as possible in India that use colocation services for their operations. For instance, in September 2022, Power Grid Corporation India Ltd and Tele India Datacenter, also known as "Datasamudra," India's first ON-DEMAND and ON-REQUIREMENT data center based in Bangalore, offering globally aligned colocation, hosting & cloud services, signed a Memorandum of Understanding to pool their resources to enhance user experience. Additionally, in May 2022, US colocation provider Cyxtera began offering colocation services in India owing to its strategic partnership with SifyTechnologies Limited.

Growing investments by the government and major manufacturers have led to increased data centers worldwide. According to a report by the United States International Trade Commission, in 2021, the United States had 33% of the global share, the United Kingdom 6%, Germany 5%, and China 5%.

Growing demand for data center colocation in the healthcare industry is fuelling market growth.

By end-user, the data center colocation market has been classified into communication and technology, manufacturing, government, healthcare, BFSI, media and entertainment, and others. Utilizing colocation services allows hospitals to concentrate more on providing services, such as patient care, medical research, and innovation, and less on managing data centers. The storage of electronically protected health information (ePHI) may be outsourced to colocation data centers, resulting in considerable financial savings for healthcare organizations wanting to expand their operations and research. To deliver high-quality patient care and abide by strict regulations and legislation, the healthcare industry needs total control and visibility over essential data, such as electronic medical records. Healthcare facilities must also provide uptime and availability to accept evolving technology. These factors contribute to the widespread use of private hosting in colocation facilities among enterprises operating in the healthcare industry. For instance, Siemon's cutting-edge data center solutions were deployed by Wellstar Health Systems to facilitate a successful expansion. Additionally, the considerable presence of colocation providers in developed economies like the Netherlands presents prospects for the industry during the projected period.

North America is expected to hold a considerable market share due to the expanding digital economy, rapid technological advancements, and the need for enhanced data security and compliance.

The data center colocation market has been classified by geography into North America, South America, Europe, the Middle East and Africa (MEA), and the Asia Pacific. The number of data centers in various states across the US provides valuable insights into the potential growth of the data center colocation market. The concentration of data centers in specific states signifies a robust industry within those regions. With 239 data centers, California stands out as a prominent hub for data center infrastructure. Texas follows closely with 185 data centers, indicating a substantial presence within the state. Florida, New York, and Virginia also exhibit many data centers, with 113, 106, and 100, respectively. These figures suggest a growing demand for data center infrastructure and indicate potential opportunities for colocation services. The states with higher numbers of data centers may present a favourable market for colocation providers, as businesses in those regions seek to outsource their data center needs to specialized facilities. Additionally, the concentration of data centers in certain states, such as Virginia's Ashburn area, signifies a thriving ecosystem for data centers, further promoting the growth of the data center colocation market in the US.

Global Data Center Colocation Market Scope:

Market Segmentation:

• By Colocation Model
  • Wholesale
  • Retail
• By Enterprise Size
  • Small
  • Medium
  • Large
• By End-User Industry
  • Communication and Technology
  • Manufacturing
  • Government
  • Healthcare
  • BFSI
  • Media and Entertainment
  • Others
• By Geography
  • North America
    • United States
    • Mexico
    • Canada
  • South America
    • Brazil
    • Argentina
    • Others
  • Europe
    • United Kingdom
    • Germany
    • France
    • Spain
    • Italy
    • Others
  • Middle East and Africa
    • Saudi Arabia
    • UAE
    • Others
  • Asia Pacific
    • China
    • Japan
    • India
    • South Korea
    • Taiwan
    • Thailand
    • Indonesia
    • Others