Americas data center colocation market worth $10.6 bn by 2027

According to Arizton’s latest research report, the data center colocation market in Americas is to grow at a CAGR of 5.34% during 2022-2027. Virginia is considered the data center capital of the world. It is the largest contributor to data center floor space in the Americas and added more than 3 million square feet in more than 15 data center facilities. Virginia is followed by Georgia and California. Colocation service provider Switch is the major contributor to the area, with around two million square feet, followed by Cologix and STACK Infrastructure.

The region has a presence of technical parks, special economic zones, and free trade zones that provide investment support or tax incentives in the development of data centers across the region. Some industrial parks include Tahoe Reno Industrial Center (TRI) and Elk Grove, Industrial Park. The Americas data center colocation market by area is expected to reach 8,495 thousand square feet by 2027, growing at a CAGR of 5.17%.

In the Americas, investments in submarine cables have increased considerably over the years, with the government and enterprises continuously strengthening fiber infrastructure for better connectivity with other countries. Several telecommunication providers and hyperscale data center operators invest in cables to improve network connectivity within the country. The adoption of cloud, big data, and IoT technologies has strengthened the need for strong fixed broadband connectivity in the last five years. Along with submarine cables, the market is also witnessing a growth in data storage and connectivity demand due to the growing inland connectivity options.

The North American data center market leads growth in the overall industry, with early availability and adoption of innovative technology and investments from colocation service providers, hyperscale operators, enterprises, and government agencies. Investments in North America are driven by the availability of land, governmental support, data protection laws, and tax incentives by the state governments. In North America, the U.S. dominates the Americas data center colocation market, followed by Canada, with increased investments from colocation providers, hyperscale data center operators, enterprises, and government agencies in data center facilities, adopting redundant power backup infrastructure. Northern Virginia, Georgia, California, Texas, Arizona, Ontario, Montreal, Toronto, and Richmond are favorable destinations for investors in North America.

In Latin America, countries like Brazil are witnessing the rapid adoption of renewable energy, which leads to the growth of the facilities; in Mexico and other Latin American countries, the demand for centers was driven by the growth of the gaming industry and the special economic zones.

The rapid investment in 5G technology and its deployment will increase the number of connected devices, leading to the generation of a substantial amount of data, further increasing investments in edge data centers across regions for low latency and ease of accessibility to data device-to-device communications. American Countries have deployed 5G network services, and some are on a 5G trial basis. AT&T, T-Mobile, CenturyLink, TELUS, Rogers Communications, Bell, SaskTel, Nokia, SubTel, Alvis, Claro, Antel, Entel, and Ericsson are some of the companies which are involved in the deployment of the 5G network services across the region.

In the Americas, countries such as the U.S., Canada, Chile, and Uruguay have commercially deployed 5G network services. Additionally, Brazil, Colombia, Argentina, Mexico, Peru, and other Latin American countries are in the stage of 5G planning, trials, and yet-to-deploy commercial services during the forecast period.

CT Bureau