According to a new research report by the market research and strategy consulting firm, Global Market Insights, Inc, Green Data Center Market size is set to exceed USD 25 billion by 2024.rapid growth in the number of SMEs globally has led to an exponential rise in the amount of data generated. The mounting pressure for efficient management for the increasing amount of data will contribute to the green data center market growth. Several government organizations are encouraging the growth of new businesses.
The government push is largely concentrated in Asia Pacific countries through the launch of Made in China 2025 and Make in India which are providing tax incentives, financial aid, and technical support to local SMEs, fueling the industrial growth. The growing data center complexities with the rising amount of data generated has stressed the requirement for a reliable and scalable data center infrastructure. Driven by surging cloud applications, the fast-growing data center traffic will support the market growth.
The growing focus on energy efficiency has made the data center industry a frontrunner in implementing energy-efficient solutions. The energy consumption of data centers has been rapidly increasing with the advent of cloud computing services and is causing an increase in CO2 emissions. There is a high focus on the need for lowering the Power Usage Effectiveness (PUE) amongst companies, primarily amongst major players such as Allied Controls, Facebook, and Google. Stringent government regulations pertaining to energy-efficiency in data centers will contribute to the green data center market size. Green initiatives can help a company to regain the power and cooling capacity and recapture resilience while reducing the energy costs.
Cyber security threats are a key factor restraining the green data center market growth. Financial organizations and businesses store critical and confidential data in data centers. Stringent government regulations such as European General Data Protection Regulation (GDPR) are imposing rules pertaining to the safety of information in data centers. The providers must comply with the strict standards and regulations operating in the market. Additionally, the technologies cost significantly higher than the traditional systems.
The networking solutions in the green data center market will grow substantially with a CAGR of around 27% due to the rising demand for these solutions to minimize the power consumption. The conventional network infrastructure ensures interconnection of physical and network-based equipment and devices within a facility that consumes over 65% of the overall power. Moreover, there is a growing trend of virtualized networking environments. Network virtualization is being increasingly implemented by enterprises to reduce costs, improve efficiency, and enhance agility.
The BFSI sector in the green data center market valued at over USD 900 million in 2017 is witnessing a rapid growth globally with the growing number of financial organizations adopting digitalization. Traditional data handling techniques that involved paper documents are being replaced by modern digital technologies for higher efficiency, lower redundancies, and faster computation. This has led to a rise in the demand for highly efficient data center infrastructures that ensure the safe storage of the ever-increasing data. The flourishing BFSI industry will provide lucrative growth opportunities to the market growth.
The green data center market in Asia Pacific will experience a strong growth of over 30% from 2018 to 2024 owing to the widespread adoption of cloud and IoT technologies in countries such as China and India. The rapid growth in the number of startups in India coupled with the favorable government initiatives such as Make in India will support the green data center market growth in the country.
The booming industrial sector in Japan is demanding high performance equipment for mounting volumes of data from connected factories. The rise in the number of smartphone users in China are also demanding data center set ups for data storage. Infocomm Media Development Authority (IMDA) has collaborated with government agencies to develop a Singapore Standard for green infrastructure under the IT standards committee.
Players operating in the green data center market comprise Dell Inc., Huawei Technologies Co., Ltd., HCL Technologies Limited, IBM Corporation, Microsoft Corporation, Fujitsu Ltd., Schneider Electric SE, and Hewlett-Packard Enterprise Company.
Companies are striving to launch new data centers to strengthen their market presence. In May 2016, Microsoft stated that they will be obtaining a LEED Gold certification for all its structures to lower their PUE. Vendors are also increasingly incorporating latest advanced technologies in their data centers to reduce the hazardous emissions and power consumption. Increasing competition among companies to offer advanced solutions will propel the market share.