Data Center as a Service Market to hit $289.91 billion, Globally, by 2031 at 18.3% CAGR, says Coherent Market Insights

The Global Data Center as a Service Market Size was Valued at USD 89.58 Billion in 2024 and the Worldwide Data Center as a Service Market Size is Expected to Reach USD 289.91 Billion by 2031, according to a research report published by Coherent Market Insights. Companies covered: 365 Data Centers, Alibaba, Amazon.com, Inc., AT & T, Cloudian, Cyxtera Technologies., Dell Inc., Digital Ocean, LLC., Digital Reality, Equinix, Inc., Hewlett Packard Enterprise Development LP, Huawei, IBM Corporation, Linode LLC., Microsoft Corporation


Burlingame, Aug. 13, 2024 (GLOBE NEWSWIRE) -- The global Data Center as a Service Market, valued at $89.58 billion in 2024, is on a trajectory of rapid expansion, with projections indicating it will soar to $289.91 billion by 2031, growing at a compound annual growth rate (CAGR) of 18.3% from 2024 to 2031, as per a recent report by Coherent Market Insights. Growing volume of data generated by organizations across industries has increased the need for scalable and flexible IT infrastructure. Data center as a service allows organizations to deploy infrastructure on demand as their computational and storage requirements change over time. It eliminates the upfront capital expenditure required to set up on-premise data centers and reduces the maintenance overhead. This pay-as-you-go model has become highly attractive for enterprises looking to focus more on their core business functions rather than managing IT infrastructure.

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Market Dynamics:

The growing demand for cost-effective data center services and increasing adoption of cloud-based services are the major factors driving the growth of the global data center as a service market. The data center as a service offers various benefits such as low upfront cost, reduced maintenance cost, increased scalability, and pay-per-use model. Additionally, it allows enterprises to focus on their core business activities rather than IT infrastructure management. The growing reliance on cloud-based applications and big data analytics is further propelling the demand for data center as a service.

Data Center as a Service Market Report Coverage

Report CoverageDetails
Market Revenue in 2024$89.58 billion
Estimated Value by 2031$289.91 billion
Growth RatePoised to grow at a CAGR of 18.3%
Historical Data2019–2023
Forecast Period2024–2031
Forecast UnitsValue (USD Million/Billion)
Report CoverageRevenue Forecast, Competitive Landscape, Growth Factors, and Trends
Segments CoveredBy Infrastructure, By Organization Size, By Vertical
Geographies CoveredNorth America, Europe, Asia Pacific, and Rest of World
Growth Drivers• Global Need For Scalability In IT Infrastructure

• Rising Significance Of Optimal Resource Utilization
Restraints & Challenges• Security threats associated with cloud adoption

• High initial investment requirement

Market Trends:

The growing popularity of colocation services and increased investments in data center construction are the major trends witnessed in the global data center as a service market. Colocation or colo services provide dedicated space, power, cooling, and physical security for organizations to house their servers and storage equipment within the data center. It is a popular data center infrastructure outsourcing option for organizations to reduce capital expenditure. Moreover, leading cloud service providers are investing heavily in designing and constructing mega data center facilities to cater to the growing demand from enterprises. For instance, in 2021 AWS announced plans to invest $5 billion for construction of data centers across 27 regions globally by 2030.

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Market Opportunities:

Infrastructure as a Service (IaaS) allows enterprises to outsource their data center hardware infrastructure such as servers, storage, networking components, and data center space. It provides on-demand provisioning of servers, storage, and other computing resources as needed without upfront investment. Enterprises can avoid huge upfront capital expenditure on building their own data centers and instead opt for pay-per-use basis. IaaS adoption is growing as it provides enterprises flexibility, scalability, and accelerated time-to-market.

Managed services allow enterprises to outsource management and maintenance of their data centers to third-party managed service providers. It provides various managed services like server management, storage management, database management, backup and disaster recovery services, and network management. Managed services help focus internal IT teams on more strategic initiatives rather than routine data center operations. It further reduces IT costs and risks for enterprises. Growing complexity of on-premise data center infrastructure and need for continuous optimization is fueling adoption of managed services.

Key Market Takeaways

Data Center as a Service market is anticipated to witness a CAGR of 18.3% during the forecast period 2024-2031, owing to growing demand for scalable, flexible and economic data center solutions.

On the basis of Infrastructure, servers segment is expected to hold a dominant position, owing to increasing dependence of enterprises on virtualization. Within servers, demand for virtual servers is expected to grow at higher rate.

On the basis of Organization Size, SMEs segment is expected to hold a dominant position over the forecast period, due to their need to optimize IT budgets.

On the basis of Vertical, Retail segment is expected to hold a dominant position due to growing e-commerce industry requiring scalable data center infrastructure.

On the basis of region, North America is expected to hold a dominant position over the forecast period, due to early adoption of advanced data center solutions in this region.

Key players operating in the Data Center as a Service market include IBM Corporation, Microsoft Corporation, Hewlett Packard Enterprise Development LP, and others. These players are focusing on new service launches and partnerships to expand their market share.

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Recent Developments:

In June 2024, Cisco expanded its security footprint with the launch of the first security cloud data centers in Jakarta, Indonesia. This launch marks a new milestone in Cisco’s commitment to supporting businesses’ cyber security readiness in the country. This is in response to the fast-growing demand for security services across the country. The move allows businesses in Indonesia, especially the public sector, financial services, and state-owned enterprise customers, to align closer to local data regulations and compliance requirements.

In August 2023, Digital Realty introduced high-density data center colocation services in 28 markets in Asia Pacific, EMEA, and North America. Up to 70 kilowatts of workload per rack can be supported by the service.

Detailed Segmentation:

By Infrastructure:

  • Servers
  • Storage
  • Networking

By Organization Size:

  • SMEs
  • Large Enterprises

By Region:

North America:

  • U.S.
  • Canada

Latin America:

  • Brazil
  • Argentina
  • Mexico
  • Rest of Latin America

Europe:

  • Germany
  • U.K.
  • Spain
  • France
  • Italy
  • Russia
  • Rest of Europe

Asia Pacific:

  • China
  • India
  • Japan
  • Australia
  • South Korea
  • ASEAN
  • Rest of Asia Pacific

Middle East:

  • GCC Countries
  • Israel
  • Rest of Middle East

Africa:

  • South Africa
  • North Africa
  • Central Africa

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About Us:

Coherent Market Insights is a global market intelligence and consulting organization that provides syndicated research reports, customized research reports, and consulting services. We are known for our actionable insights and authentic reports in various domains including aerospace and defense, agriculture, food and beverages, automotive, chemicals and materials, and virtually all domains and an exhaustive list of sub-domains under the sun. We create value for clients through our highly reliable and accurate reports. We are also committed in playing a leading role in offering insights in various sectors post-COVID-19 and continue to deliver measurable, sustainable results for our clients.

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