Description
The global data centre colocation and interconnection (DCI) market has shown great resilience, and grown consistently and steadily through a period marked by macroeconomic headwinds, conservative enterprise IT buying behaviour, supply chain challenges, geopolitical turmoil, energy pricing volatility and various other disruptive after-effects of the global pandemic.
But some of this is moving to the rearview mirror. As the sector moves through 2024, there are tangible signs that conditions have changed meaningfully, positioning the sector for what is expected to be a sustained period of accelerating growth. As a whole, the data centre colocation market was estimated to be worth USD $79.4b in 2023, a figure that represented 13.2% y/y growth. Looking ahead to 2024, the market is expected to continue on this upward trajectory, growing 16.4% y/y to $92.4b. Global expansion, hyperscale consumption, uptake in interconnection and development of edge locations are among the key drivers. Adding to the positive outlook is an improving macroeconomic environment and, of course, the aggressive rise of demand for AI infrastructure and services. The five-year CAGR for the 2024-29 period is expected to come in at 15.1%. The numbers are all up from our previous market projections, while we emphasise that our methodology tries to carefully take into account the gaps that emerge between demand, uptake and materialisation.
This report also includes global data centre colocation inventory on a MW basis and marketshare data for interconnection. The marketshare analysis is supported by detailed regional breakdowns for four major regions: APAC, North America, EMEA and Latin America. We also include inventory estimates (on a MW basis) for major markets in all four regions along with a maturity index that maps out current and emerging markets. Finally, we provide a summary of regional market dynamics and analysis of colocation consumption trends. Regional variations within these trends are also discussed.
While the data centre colocation sector is healthy and growth is clearly moving in a positive direction, the sector does face challenges. Energy constraints are making it harder for hyperscalers to build out the capacity they need to serve the requirements and demand signals they are seeing, and this is creating a gap between what customers want and what can be served and ultimately translated into revenue and marketshare. Meanwhile, hyperscale self-build activity continues to impact data centre colocation demand, but there are emerging models that allow the ecosystem to capture and be an indispensable part of the value chain. The world between colocation and self-builds is not black and white, and the middle ground is increasingly part of a complex mix of operating providers, business models, real estate and capital sources that are central parts of this report.
The Global Colocation MarketShare Report remains the most comprehensive dataset on the global data centre colocation market and an indispensable resource for any service provider, investor or end user looking to understand and project the future of the market or find a service provider. This latest refresh reflects our more granular view of the landscape, which produces deeper insights into markets in the top tier and better visibility into all corners of this global market, while accounting for the significant changes created by the rise of AI demand and the rapidly increasing constraints around land and power availability. This report also has two sister reports published in 2024: 1) The Hyperscale Self-Build; Report; and 2) The AI Infrastructure Marketshare Report.
