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 2024 To 2029

Data Center Colocation Market Size:

The global data center colocation market is estimated to be around US$84.135 billion in 2024 and is anticipated to grow to US$162.676 billion by 2029 at a CAGR of 14.10%.

Data Center Colocation Market Trends:

The global data center colocation market is sure to witness rising growth, especially with the rise of internet usage worldwide. The global data center colocation market is also forecasted to rise as the demand for colocation in the healthcare industry has grown significantly worldwide. Furthermore, the rising incidents of cyber and phishing attacks across the globe can act as a major hindrance to market growth. The wholesale will attain a greater market share in the market's colocation model segment. In contrast, medium enterprises will grow significantly in the enterprise size category of the market.

A colocation facility is a type of facility that refers to renting out space in a data center. The colocation center allows companies to rent equipment, bandwidth, and space for computing services. The market for data centers 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.

Data Center Colocation Market Growth Drivers:

• Increasing use of the internet across the globe.

One of the major driving factors for the global data center colocation market is estimated to be the expansion of global internet usage. With the expansion of global internet usage, data creation is forecasted to expand across the globe. The population of individuals using the internet worldwide has witnessed a massive increase, majorly with the introduction of new technologies like 5G, IoT, and AI, among others.

The International Telecommunication Union (ITU), in its global statistics, stated that in 2021, about 63% of the global population had access to the Internet, which was about 4.9 billion individuals. This number increased to about 5.1 billion, or about 64% of the total global population. The total number of individuals using the internet in the globe increased to about 5.4 billion, or about 67% of the total population.

• Growing demand for data center colocation in the healthcare industry.

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, Wellstar Health Systems deployed Siemon's cutting-edge data center solutions 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.

Data Center Colocation Market Restraints:

• Increasing incidents of cyber breaches.

The growing risk of data breaches and cyber-attacks is estimated to hinder the global data center colocation market’s growth. With the increasing global cases of cyber attacks, data breaches or phishing incidents have witnessed massive growth in recent times.

The IT Governance UK stated that in 2023, the globe witnessed about 8.214 billion record breaches caused by data breaches and cyber-attacks. The agency further stated that in 2023, about 3.8 billion records were breached by DarkBeam, a UK-based organization. In contrast, about 1.523 billion cases of record breaches were recorded on the Real Estate Wealth Network of the USA. The Indian Council of Medical Research (ICMR) recorded a breach of about 815 million records, whereas Kazakhstan's Kid Security witnessed a record breach of about 300 million.

Data Center Colocation Market Geographical Outlook:

• North America is anticipated to hold a significant share of the Global Data Center Colocation Market.

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 data center colocation market growth. 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 favorable 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.

Data Center Colocation Market Products Offered by Key Companies:

• Rackspace Technology is a global cloud solution provider. The company offers its products and services to multiple industries worldwide, such as BFSI, government, healthcare, manufacturing, oil & gas, and consumer goods, among others. The company offers its solutions across multiple platforms, like cloud solutions, applications, data, and security platforms. In the global data center colocation market, the company offers its data center colocation services, which offer best-in-class data center facilities.
• NTT Communications is a global corporation that offers its products and solutions across multiple industries like capital market, automotive, healthcare, education, and energy & natural resources, among others. The company's services include the network as a service, cloud & IT infrastructure, technology solutions, global data centers, and digital collaboration. In the global data center colocation market, the company offers multiple products like cabinets & racks, custom cages, private suits, and powered shells.

Data Center Colocation Market Key Developments:

• In July 2024, Data Realty, a global corporation that offers data center, colocation, and interconnection solutions, announced the acquisition of Slough data center campus. This acquisition is estimated to boost the company's colocation capability in the European region. The company invested about US$200 million in the acquisition and has a capacity of about 15 megawatts.
• In January 2024, Digital Realty announced the launch of its MAA10 data center in India. The company launched the data center on a 10-acre campus, which can support about 100 megawatts of critical loads.

Global Data Center Colocation Market:

Report Metric	Details
Data Center Colocation Market Size in 2024	US$84.135 billion
Data Center Colocation Market Size in 2029	US$162.676 billion
Growth Rate	CAGR of 14.10%
Study Period	2019 to 2029
Historical Data	2019 to 2022
Base Year	2024
Forecast Period	2024 – 2029
Forecast Unit (Value)	USD Billion
Segmentation	Colocation Model Enterprise Size End-User Industry Geography
Geographical Segmentation	North America, South America, Europe, Middle East and Africa, Asia Pacific
List of Major Companies in the Data Center Colocation Market	Equinix Inc. Telehouse Rackspace US Inc. Zayo Group LLC NTT Communications
Customization Scope	Free report customization with purchase

 

The Data Center Colocation Market is segmented and analyzed as follows:

• 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

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1. INTRODUCTION

1.1. Market Overview

1.2. Market Definition

1.3. Scope of the Study

1.4. Market Segmentation

1.5. Currency

1.6. Assumptions

1.7. Base and Forecast Years Timeline

1.8. Key benefits for the stakeholders

2. RESEARCH METHODOLOGY  

2.1. Research Design

2.2. Research Process

3. EXECUTIVE SUMMARY

3.1. Key Findings

4. MARKET DYNAMICS

4.1. Market Drivers

4.2. Market Restraints

4.3. Porter’s Five Forces Analysis

4.3.1. Bargaining Power of Suppliers

4.3.2. Bargaining Power of Buyers

4.3.3. The Threat of New Entrants

4.3.4. Threat of Substitutes

4.3.5. Competitive Rivalry in the Industry

4.4. Industry Value Chain Analysis

4.5. Analyst View

5. GLOBAL DATA CENTER COLOCATION MARKET BY COLOCATION MODEL

5.1. Introduction

5.2. Wholesale

5.3. Retail

6. GLOBAL DATA CENTER COLOCATION MARKET BY ENTERPRISE SIZE

6.1. Introduction

6.2. Small

6.3. Medium

6.4. Large

7. GLOBAL DATA CENTER COLOCATION MARKET BY END-USER INDUSTRY

7.1. Introduction

7.2. Communication and Technology

7.3. Manufacturing

7.4. Government

7.5. Healthcare

7.6. BFSI

7.7. Media and Entertainment

7.8. Others

8. GLOBAL DATA CENTER COLOCATION MARKET BY GEOGRAPHY

8.1. Introduction

8.1. North America

8.1.1. By Colocation Model

8.1.2. By Enterprise Size

8.1.3. By End-User Industry

8.1.4. By Country

8.1.4.1. United States

8.1.4.2. Canada

8.1.4.3. Mexico

8.2. South America

8.2.1. By Colocation Model

8.2.2. By Enterprise Size

8.2.3. By End-User Industry

8.2.4. By Country

8.2.4.1. Brazil

8.2.4.2. Argentina

8.2.4.3. Others

8.3. Europe

8.3.1. By Colocation Model 

8.3.2. By Enterprise Size

8.3.3. By End-User Industry

8.3.4. By Country

8.3.4.1. United Kingdom

8.3.4.2. Germany

8.3.4.3. France

8.3.4.4. Spain

8.3.4.5. Italy

8.3.4.6. Others

8.4. Middle East and Africa

8.4.1. By Colocation Model

8.4.2. By Enterprise Size

8.4.3. By End-User Industry

8.4.4. By Country

8.4.4.1. Saudi Arabia

8.4.4.2. UAE

8.4.4.3. Others

8.5. Asia Pacific

8.5.1. By Colocation Model

8.5.2. By Enterprise Size

8.5.3. By End-User Industry

8.5.4. By Country

8.5.4.1. China

8.5.4.2. Japan

8.5.4.3. India

8.5.4.4. South Korea

8.5.4.5. Taiwan

8.5.4.6. Thailand

8.5.4.7. Indonesia

8.5.4.8. Others

9. COMPETITIVE ENVIRONMENT AND ANALYSIS

9.1. Major Players and Strategy Analysis

9.2. Market Share Analysis

9.3. Mergers, Acquisitions, Agreements, and Collaborations

9.4. Competitive Dashboard

10. COMPANY PROFILES 

10.1. Equinix  Inc.

10.2. Telehouse 

10.3. Rackspace US Inc. 

10.4. Colt Technology Services Group Ltd.  

10.5. Zayo Group LLC 

10.6. NTT Communications 

10.7. Cyxtera Technologies 

10.8. SaskTel  

10.9. eStruxture  

10.10. Centrilogic  

10.11. Hut 8  

10.12. Vantage  

10.13. RackBank

Data Center Colocation Companies:

• Equinix Inc.
• Telehouse
• Rackspace US Inc.
• Colt Technology Services Group Ltd. 
• Zayo Group LLC
• NTT Communications
• Cyxtera Technologies
• SaskTel 
• eStruxture 
• Centrilogic 
• Hut 8 
• Vantage 
• RackBank