PUBLISHER: Knowledge Sourcing Intelligence | PRODUCT CODE: 1456874
PUBLISHER: Knowledge Sourcing Intelligence | PRODUCT CODE: 1456874
The Americas data centre colocation market is evaluated at US$21.741 billion for the year 2022 growing at a CAGR of 10.9% reaching the market size of US$44.848 billion by the year 2029.
Information and communications technology are at the heart of the digital economy. It is estimated that increasing investments in information and communications technology will positively impact the colocation market during the forecasted period. The major growth drivers of America's data center colocation market are the presence of a large number of small and big players, increasing adoption of cloud computing solutions, and rising demand from service providers. The other major factor augmenting the growth of the colocation market is the increasing focus on data privacy and regulation in the country. Enterprises operating in the entertainment and media, healthcare, communication, and government sectors are increasingly outsourcing their IT infrastructure needs as well as opting for colocation space to focus on their core business operations and reduce operating costs.
Rising penetration of 5G technology
5G technology is expected to be launched during the forecast period, which is further anticipated to increase the volume of internet traffic and the requirement for the storage of digital data. This is expected to supplement the growth of the data center colocation market with an increasing amount of data that will be required to be stored in the cloud, and firms with a limited capacity will demand colocation services to meet the growing demand effectively.
Increasing need for data security compliance
By industry vertical, data security compliance and the requirement for huge data storage are the key aspects of technology deployment in the banking and financial services industry. The industry requires analyzing huge volumes of customer data gathered from different sources to provide efficient and customer-centric services. The BFSI sector is witnessing growth across the world and enterprises are constantly upgrading their existing IT infrastructure while moving on to the latest solutions. In developing economies such as Brazil and Mexico, there is a renewed focus on social integration.
By the colocation model, retail colocation is expected to grow at a high rate
By the colocation model, the market is segmented into retail and wholesale colocation models, which are offered by different colocation service providers. Retail colocation accounts for the major market, while wholesale colocation providers have started focusing on short-term deals to remain competitive. The retail colocation service providers have modified their existing strategy to meet the challenge arising from wholesale colocation solution providers. To cater to a different segment of small customers, retail colocation service providers are buying out a large chunk of space from the wholesale colocation providers and are then reselling the space to small and medium enterprises while catering to the additional requirements of large enterprises.
The United States is expected to grow at a high rate during the forecast period.
The United States is among the nations experiencing the fastest growth in terms of technological advancements and innovations. It is expected that the Industrial Internet of Things (IIoT) will be easier to implement with the introduction of advanced networking technologies brought by the upcoming sixth-generation (6G) networks. These upgraded networks will provide better connectivity and functionalities, making it easier to incorporate IIoT into various industries and easier for companies to take advantage of its advantages. Operators have a strong interest in Virginia and the Southeast in general. They invest a lot of money to increase their market share and presence in the region. Oregon, Idaho, Utah, and California are part of the fully developed colocation market that is the Western U.S. region. Numerous data center locations in these states provide colocation services to nearby businesses and organizations.
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