Modular Data Center Market Size, Share & COVID-19 Impact Analysis, By Component (Function Module Solutions, and Services), By Application (Emergency Data Storage, Temporary Storage Expansion, Disaster Recovery, Edge Computing, and Others), By Data Center Size (Small and Medium Data Center, and Large Data Center), By Industry (BFSI, IT & Telecom, Government, Healthcare, Media & Entertainment, Others) and Regional Forecast, 2020-2027

The global modular data center market size was valued at USD 16.56 billion in 2019 and is projected to reach USD 65.55 billion by 2027, exhibiting a CAGR of 19.0%. North America dominated the global market with a share of 34.36% in 2019.

The market size of modular data centers is predominantly driven by rising demand for advanced prefabricated and green data center infrastructures across IT & telecom, healthcare, and other industries. These advanced data centers assist organizations to increase scalability, density, and offer easy deployment benefits. The rising investment by the government and key players for the development of advanced data centers is expected to boost the growth of the market. For instance, in February 2018, Google LLC invested around USD 6 billion for the development of green data centers and energy-efficient infrastructure systems.

The increasing demand for solutions and services such as cloud-based networking, artificial intelligence (AI), robotics and automation, and others, has assisted providers to develop modular data centers.

Companies Plan on Investments to Develop Advanced Data Center amid COVID-19

The coronavirus pandemic has impacted the global economy severely. At present, the epidemic situation has forced organizations to allow their employees to adopt WFM (work from home) policy. In March 2020, referring to the survey by Owl Labs, about 16% of major organizations globally have adopted fully remote services and permitted their workforces to work from home. Likewise, the global IT industry has slowed down its operations, and several IT investments and budgets are on hold. Considering initial indicators from the first half of 2020, an insignificant decline is observed in the demand for modular data centers. However, the overall demand for managed network services and remote working applications is increasing. Owing to this, key companies driving the market are planning to invest as a part of their business strategies to offer enhanced customer services.

During the pandemic, key players such as Google LLC, Microsoft Corporation Amazon Web Services, Oracle Corporation, and others, are focused on increasing their spending in billions for the development of advanced building enabled with hyperscale data centers. For instance, in April 2020, Dell, Inc., invested around USD 4.5 billion in R&D activities for the development of various projects including data center, public cloud, VxRail, unified workspace, and others. The company is leveraging several opportunities to cope up with the pandemic, by investing in various emerging technologies.

LATEST TRENDS

Increasing Demand for Green Data Centers to Augment Growth

One of the key emerging market trends is the rising adoption of advanced green data centers across developed countries such as the US, Canada, the UK, France, and others. Green data center solution is enabled with high energy-efficient equipment and management system that provides organizations with maximum efficiency and minimum environmental impact. The rising investment for the development of advanced green data centers across countries such as India, South Korea, Australia, Saudi Arabia, Brazil, and others, is expected to boost the market size during the forecast period. For instance, in January 2018, Apple, Inc. announced an investment of around USD 10 billion for various data Center projects. The company developed an advanced green data center based on green energy concepts.

DRIVING FACTORS

Growing Adoption of Cloud-based Solutions by SMEs to Favor Growth

The growing adoption of cloud-based solutions and services is considered as one of the major key drivers for the market. Government and large organizations are focused on adopting advanced cloud solutions and applications. To store an enormous amount of information, key players in the global market are focused on developing advanced modular data centers enabled with immersive technologies. For instance, in January 2019, GI Partners invested in the development of technology infrastructure and bought two data centers from NTT Data. Furthermore, in March 2018, CyberPower Systems (USA), Inc. announced the launch of cloud-based software, Power Panel for UPS systems. This cloud-based software assists users to remotely monitor and control the unattended computer shutdowns.

Advancement of technologies such as 5G infrastructure, big data, internet of things (IoT), and others are expected to drive the demand for modular data centers.

RESTRAINING FACTORS

Lack of Awareness to Impede Adoption of Product

Although data Center provides several advantages, however, the majority of the users are dependent on on-premises services. Also, the high cost of implementation and lack of awareness for modular data centers mainly in countryside areas or where network connectivity and IT service is not available is expected to obstruct the growth of the market. Other factors such as virtualization of data centers and restrictive form are expected to hinder the growth of the market.

SEGMENTATION

By Component Analysis

Function Module Solutions to Hold High Market Share Owing to Rising Adoption of All-in-one and Individual Solutions

Based on the component, the market is divided into function module solutions and services.

The function module solutions are expected to cover the largest modular data center market share. This growth is owing to the rising adoption of collocation solutions such as all-in-one and individual, offered by the market players.

The services segment is expected to grow with the highest CAGR during the forecast period owing to the increasing adoption of public cloud services among startups and SMEs.

By Application Analysis

Temporary Storage Expansion Segment to Hold Largest Market Share Due to Rising Adoption of IT and Cooling Modules

Based on the application, the market is classified into emergency data storage, temporary storage expansion, disaster recovery, edge computing, and others.

Temporary storage expansion is anticipated to hold the largest market share. The growth in the segment is owing to the rising adoption of IT and power and cooling modules for large data centers across organizations.

Other segments such as disaster recovery, emergency data storage, edge computing, and others, are expected to showcase considerable growth.

By Data Center Size Analysis

Increasing Investment by Startups and SMEs, Aid to Growth of the Market

Based on the data center size, the market is segmented into small and medium data centers and large data centers.

The small & medium data center is likely to grow with the maximum CAGR owing to the increasing investment by startups and SMEs to adopt cloud services.

The large data center segment is projected to showcase a considerable growth rate owing to the rising demand for private cloud among the large enterprises.

By Industry Analysis

Increasing Demand for Prefabricated Data Centers across End-use Industry to Aid Growth

Based on the industry, the market is divided into BFSI, IT & Telecom, Government, Healthcare, Media & Entertainment, Others.

IT & Telecom is expected to hold a major share during the forecast period. Key market players are focusing on designing advanced prefabricated data centers to cater to the rising demand across the IT & Telecom industries. Furthermore, the increasing investment by key players is expected to drive the growth of the market. For instance, in April 2020, General Insurance Corporation announced its partnership with Equinix and Vantage Data Centers and invested around USD 2 billion for the development of advanced prefabricated data centers across European countries.

Other segments such as BFSI, government, healthcare, media & entertainment, are expected to grow significantly during the forecast period.

REGIONAL INSIGHTS

Based on the region, the market has been divided among five notable regions namely North America, Europe, Asia Pacific, the Middle East and Africa, and South America.

According to analysis, North America is anticipated to capture a major share in the market. The growth is mainly owing to the surging investment by the government and key players for the development of advanced prefabricated data centers. According to the Data Center Map, in 2020, there were around 1789 active colocation data centers operating in 50 states of the U.S. Also, Canada has around 176 and Mexico around 10 active colocation data centers.

Asia Pacific is anticipated to be the highest growing region. The growth is mainly owing to the rising number of SMEs and startups in countries such as China, India, Indonesia, South Korea, and others.

Europe is expected to grow with a significant CAGR during the forecast period. The growth is owing to the increasing investment in the development of secure data centers by the companies. For instance, in 2020, KKR, a global investor, planned to invest around USD 2.5 billion for the development of data centers across European countries such as Germany, France, and others.

The Middle East and Africa is predicted to grow with a modest growth rate. The investment across the Middle East and Africa is rising significantly, aided by the national government, cloud, and collocation service providers, and various telecommunication enterprises.

South America is expected to develop at a considerable growth rate, owing to rising investment for the adoption of cloud services in countries such as Brazil, Argentina, Peru and others.

KEY INDUSTRY PLAYERS

Market Players Focus on Investments in R&D Activities to Brighten Market Prospects

Market players such as IBM Corporation, Huawei Technologies Co., Ltd., and Alibaba Group, among others are aiming to implement several commercial plans and strategies. These commercial strategies would assist companies to reinforce their worldwide presence and provide unconventional services across end-users or businesses. For instance, in April 2020, Alibaba Group invested around USD 28 billion to develop advanced data centers enabled with immersive technologies such as enhanced cooling systems, AI modules, hybrid cloud, and others. The aim of development of the data centers is to support digital transformation across Asia Pacific.

LIST OF KEY COMPANIES PROFILED:

• IBM Corporation (California, United States)


• CommScope Inc. (North Carolina, United States)


• Dell, Inc. (Texas, United States)


• HPE Company (California, United States)


• Baselayer Technology LLC (Arizona, United States)


• Vertiv Co. (Ohio, United States)


• Diversitec, Inc. (Virginia, United States)


• Iron Mountain Corporation (Massachusetts, United States)


• Rahi Systems (California, United States)


• Rittal GmbH & Co. KG, (Herborn, Germany)


• Schneider Electric SE (Rueil-Malmaison, France)


• Cannon Technologies Ltd (Hampshire, United Kingdom)


• Stulz GmbH (Hamburg, Germany)


• Instant Data Centers LLC (Arizona, United States)


• Colt Group SA (London, United Kingdom)


• Bladeroom Group Ltd. (United Kingdom)


• Huawei Technologies Co., Ltd. (Shenzhen, China)


• ZTE Corporation (Shenzhen, China)

KEY INDUSTRY DEVELOPMENTS:

• February 2020: Dell, Inc. unveiled its Micro 415 that is an EMC modular data center. It provides localized data processing solutions enabled with edge computing technology.


• August 2016: In Paraguay, Tigo Tanzania invested around USD 2.50 billion for the development of the first advanced modular data center. The development of advanced data centers will aid in boosting the adoption of cloud-based networking services across the country.

REPORT COVERAGE

The modular data center market research report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product and services types, and leading applications of the product. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the advanced market over recent years.

Report Scope & Segmentation