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Home Technology Infrastructure & Platforms

Frost says 5G, AI, IoT, edge computing will drive DC growth

FutureCIO Editors by FutureCIO Editors
February 17, 2021
Photo by Scott Webb from Pexels

Photo by Scott Webb from Pexels

Frost & Sullivan’s recent analysis, Increased Investment by Cloud and Colocation Providers Drives the Global Data Centre Market, reveals that continued high levels of technology deployment worldwide will result in a proliferation of data created, driving the need for data processing and storage capacity. The result will be the construction of large volumes of data centres, ranging from enterprise to large-scale cloud.

Frost & Sullivan forecasts $432.14 billion will be invested in the data centre market by 2025, up from $244.74 billion in 2019, a CAGR of 9.9%.

Increased investments by data centre operators, increased deployment and usage of IoT and Big Data, the adoption of a hybrid model with cloud and traditional data centres, and strong growth in emerging economies will serve as key market drivers. The Asia-Pacific region will become the largest market by 2025, followed by North America and EMEA.

“The move from enterprise to cloud and colocation data centres will gain momentum because companies can reduce capital and operational costs by avoiding investments in hardware or software infrastructure and reducing maintenance and space requirements,” said Manoj Shankar, research analyst, Energy & Environment Practice, Frost & Sullivan.

“Additionally, 5G will move processing closer to the point of data collection, leading to increased deployment of micro and edge data centres and driving investments in new and next-generation data centre technologies.”

Shankar added that onsite cloud data centres will become crucial as companies will require critical data to be kept in-house or at a nearby location, thereby lessening the security risks such as data theft.

“Further, given the high demand for modular data centres and competitive pressures, modular data centre manufacturers need to innovate in this space and come up with advanced concepts that allow additional flexibility and modularity.”

Driving data centre activities

Edge Computing: Connected devices, connected living/homes, AI, gaming and video streaming, autonomous cars, and virtual and augmented reality will propel edge data centres.

Artificial Intelligence: Surging AI usage in data centres will lead to demand for advanced electronics and specialists in AI-based solutions for data centre applications and architecture.

New Capabilities: As data processing takes place close to the source, the processing time reduces. This will augment technologies like autonomous vehicles, smart devices and sensors, augmented reality, etc.

Geographic Expansion and Partnerships: Market participants need to focus on high-growth, emerging markets, like India and Southeast Asia, where data creation is still in the nascent stage and data centre construction in its infancy. Similarly, partnerships with colocation and cloud service providers will give equipment manufacturers access to new data centre construction markets, providing them with the much-needed boost.

Related:  Innovation from both sides of the fence: the Citi D10X story
Tags: 5GAIArtificial Intelligenceedge computingFrost & SullivanIoT
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