Hyperscale Data Center Market to See 20.3% Annual Growth Through 2022

March 15, 2018

WELLESLEY, Mass., March 15, 2018– Benefits pioneered by large scale cloud providers are helping to drive the global market for hyperscale data centers, according to a report by BCC Research. Future growth is expected to come as hyperscale data centers expand into mainstream data centers. This shift will be led by large financial services, telecommunications and retail enterprises, which need economies of scale and the flexibility the technologies provide.

The global market is expected to see a compound annual growth rate (CAGR) of 20.3% through 2022, when it could be worth $98.2 billion, according to the report Global Markets for Hyperscale Data Centers.

Hyperscale data centers, which are built with stripped down, commercial, off-the-shelf computing equipment, can have millions of virtual servers and accommodate increased computing demands with reduced physical space, cooling and electrical power. The savings in hardware can pay for custom software to meet business needs.

Major players in the market include AT&T Inc., Cisco Systems Inc., DataCore Software, Equinix Inc., Fogo Data Centers, Global Switch, Hewlett-Packard Enterprise, IBM, Juniper Networks, Lenovo Group Ltd., The NEC Group, Oracle Corp., Pivot3, Quantum Corp., Radware, SanDisk, Tintri Inc., Violin Memory and Western Digital Corp, among others.

Research Highlights

• The fastest growth will come from the Asia-Pacific region, which is expected to see a CAGR of 25% through 2022, when that market will be valued at $27.5 billion. The largest market by size is North America, which is expecting a CAGR of 19.7% through 2022 and an anticipated value of $35.4 billion.
• Growth in the European market has been slowed by data privacy regulations that limit the flexibility of deploying data beyond local or regional markets. This is inhibiting the ability to build hyperscale data centers where data is consolidated.
• Globally, growth is coming from specific countries or regions which are economically well-established and able to offer the infrastructure necessary to support hyperscale data centers.

“Although pioneering companies such as Facebook, Amazon and Google are leveraging the hyperscale data center infrastructure, the technology is not an easy adaptation for the typical IT organization,” said BCC Research Senior Editor and report author Michael Sullivan. “Transforming from the IT environments for different functions, architectures and vendor control systems to a streamlined virtualized and centralized computing, storage and network resources are a tremendous paradigm shift.”

Market Challenges: Outages, Design and Performance Bottlenecks

Although hyperscale data centers provide flexible and powerful solutions for IT resource management, the market’s transformation is accompanied by new challenges and disadvantages. For example, early adopters have found it difficult to determine the converged infrastructure requirements of mission-critical applications after virtualizing their infrastructure. Further, virtualization creates performance bottlenecks that can slow application performance. Likewise, designing and implementing a converged infrastructure reliant on shared resources among clustered servers can also raise complications.

Editors/reporters requesting analyst interviews should contact steven.cumming@bccresearch.com.

Global Markets for Hyperscale Data Centers( IFT123A )
Publish Date: Mar 2018    

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