Increasing popularity of green data centers to drive growth in the Chinese data center market

Renewable energy

Data center in China: Key market research findings

  • Rising construction and installation costs drives market growth
  • Physical security accounts for a majority of the market’s revenue
  • Key vendors – Alibaba, China Telecom, China Unicom, and China Mobile

Technavio’s market research analysts predict the data center market in China to grow at a CAGR of around 13% between 2016 and 2020. It has been observed by the analysts that the installation of low-density servers is highly cost-effective as opposed to high-performance and mission-critical servers. Furthermore, the adoption of basic cooling and power infrastructure is also cost-effective when compared to modern infrastructure. Competition among infrastructure vendors is likely to result in a decrease in the capital expenditure involved in building efficient data center facilities. Besides, the required investment in IT infrastructure is often higher compared to the IT budget of many organizations.

The new market research report from Technavio presents a breakdown and analysis of the data center segments based on the security.

“The market is currently witnessing an increase in the number of green data center facilities. The recent increase in carbon emissions and the high consumption of electricity by data centers across the globe are compelling enterprises to construct green data center facilities. These facilities help in the operation of energy efficient IT, power, and cooling infrastructure; thereby, reducing the electricity consumption and carbon footprint. Concepts such as free cooling, use of renewable energy sources, consolidation, and waste recycling are some of the methodologies being implemented in green data centers,” says Rakesh Panda, Lead Analyst, ICT, Technavio Research.

The physical security segment currently dominates the data center market in China and is expected to showcase substantial growth during the forecast period to account for a revenue of around $282 million by the end of the forecast period. The growth of this segment of the market is dependent on the construction and renovation of data center facilities in China. Growing concerns over security among end-users and investments made by data center owners are fueling market growth. Four-layered security is a common design criterion followed by data center operators and has subsequently increased the number of video surveillance cameras, biometric access control, and proximity card controls in such facilities.

The key vendors in the global data center market include Alibaba, China Telecom, China Unicom, and China Mobile. The market is very competitive due to the presence of several well-established international and regional vendors such as Amazon and Alibaba. These providers are specialists and skilled in managing data centers efficiently and troubleshooting the network in case of any problem. Vendors are actively engaging in collaborations to increase their market shares and meet the rising demands from businesses worldwide.

A more detailed analysis is available in the Technavio report, Data Center Market in China 2016-2020.

We can customize reports by other regions and specific segments upon request.

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