China Data Center Market Retains Robust Growth: Projected to Grow at a CAGR of 19.3% by 2027
Published | 11 October 2021
Due to the increasing usage of cloud computing and growing government and private investment in data centers, China data center market is likely to grow at a high CAGR during the forecast period…
A recent study conducted by the strategic consulting and market research firm BlueWeave Consulting revealed that China data center market was worth USD 13.2 billion in 2020. According to the study, the market is estimated to grow at a CAGR of 19.3%, earning revenue of around USD 45.2 billion by the end of 2027. China's data center market is booming due to factors such as increasing cloud computing adoption and growing government and private investment in data centers. Chinese data center giants, such as ByteDance, Tencent, and Alibaba, have led the data center growth rate over the last four quarters. Hyperscale data center providers are also investing heavily in expanding capacity at their existing facilities and upgrading their server hardware with advanced technology in order to maintain efficiency. Over the forecast period, the China data center market is expected to proliferate due to these factors. Nevertheless, the high cost of building and managing data centers could pose a major impediment to market growth.
Flourishing E-Commerce Sector Is Projected to Drive the China Data Center Market Growth During the Forecast Period
Over the last few years, China has experienced a boom in the e-commerce business with the proliferation of smartphones and the introduction of 5G networks. Consumers in the Chinese market have a lot of choices when it comes to e-commerce platforms. Among the most popular are Tmall, Vipshop, Kongfz.com, and Dangdang. As e-commerce businesses expand, the need for efficient and large-scale data centers will increase in order to ensure the smooth functioning of their websites. This growth is expected to boost the overall China data center market in the forecast period.
Growing Adoption Of Green Data Centers Is Anticipated To Boost The China Data Center Market
Data centers consume a lot of energy. Around 416 terawatts are required for it to function, which is about three% of the total amount of electricity produced on earth. Therefore, the demand for greener options for data centers is rising. Following suit, China is currently investing in the development of underwater data centers in order to reduce cooling costs. Furthermore, the country’s one of the leading data center providers Chinadata Group is also exploring the chances and potential of ‘zero emission’ data centers. Such activities are expected to boost the China data center market in the forecast period.
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China Data Center Market - By Type
Based on types, China data center market is segmented into enterprise data centers, managed services data centers, colocation data centers, and cloud data centers. Enterprise data centers hold the largest market share, as large organizations tend to have their own stand-alone data centers, which are efficient and secure. China's small and medium-sized businesses are gaining popularity among colocation data centers. A significant portion of the growth of colocation data centers in China is driven by the increasing construction of data centers for data storage based on the amount of data and the financial capacity of businesses.
Impact of COVID-19 on China Data Center Market
COVID-19 brought tremendous growth opportunities to the Chinese data center market, which seized them wholeheartedly. The majority of end-user industries, such as BFSI, media, and entertainment, healthcare, and government, have shifted to cloud computing, resulting in a tremendous surge in data. This contributed to the increasing need for data centers in China, flourishing the market growth. As the demand for data centers increased, both the government and private entities began to invest significantly in the construction of data centers in China, which is expected to boost the China data center market in the post-COVID-19 period.
China Data Center Market: Competitive Landscape
The leading players in the China data center market are Tencent Holdings Ltd, Alibaba Cloud, Fujitsu Ltd, China Mobile Limited, Digital Realty Trust Inc., China United Network Communications Group Co. Ltd., SUNeVision Holdings Ltd, China Telecommunications Corporation, Equinix Inc., Centrin Data Systems Co. Ltd, and other prominent players.
The market is highly fragmented, with numerous industry players. However, it remains open to new entrants that provide robust data center services. The companies are divided into three categories: technology, space, and data handling capacity. They also invest heavily in data center construction in order to improve their business capacity. Furthermore, competitive strategies such as mergers, acquisitions, partnerships, collaborations, etc., is common in this industry.
The in-depth analysis of the report provides information about growth potential, upcoming trends, and statistics of the China data center market. It also highlights the factors driving forecasts of total market size. The report promises to provide recent technology trends of the China data center market and industry insights to help decision-makers make sound strategic decisions. Furthermore, the report also analyses the growth drivers, challenges, and competitive dynamics of the market.
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