Colocation and Managed Hosting Market Forecast to Reach $625.8 Million by 2026

Growing Investments From Various Sectors Towards Infrastructure Development of Data Centres Are Booming the Growth of Colocation and Managed Hosting Market.

The Global Colocation and Managed Hosting Market is forecast to reach $625.8 million by 2026, growing at a CAGR of 12.2% from 2021 to 2026. The market growth is attributed to the factors such as growing data centres, technological developments, growing expenditure through regulated cloud providers and colocation networks and others. Moreover, rising adoption of IOT devices, edge computing and others boosts the market growth.

The market growth is attributed to the factors such as growing deployment of cloud-based storage systems, rising growth of advanced technologies such as IoT, AI and many others along with providing increased work productivity across different industries. Moreover, growing investments from various sectors towards infrastructure development of data centres are also booming the market growth. The rising demand for remote monitoring services and software designed data services will be a major market driver.

Colocation and Managed Hosting Market Segment Analysis – By Type

Wholesale colocation segment held the highest market share at 69.1% of Colocation and Managed Hosting market in 2020. Moreover, it is anticipated to witness the significant market growth during the forecast period 2021-2026. The wholesale data center placement market is becoming increasingly common because it provides higher capacity, prevention of service interruptions, strategic positioning, and lowered average ownership costs.

Owing to the rising phenomenon of cloud adoption, the market for solely managed data centres has declined and driven the demand for remote monitoring services. Moreover, with growing volume of files, the growth of current data centres would take up a lot of room in the premises. Wholesale data centres reserve data centre facilities within a spectrum of 10,000 to 20,000 square feet.

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Colocation and Managed Hosting Market Segment Analysis – By Organisation size

Colocation and Managed Hosting market is segmented into Small enterprise, Medium enterprise, large enterprise on the basis of organisation size. The Small enterprises segment is anticipated to witness the highest market growth at 14.1% during the period 2021-2026. Commoditization and ever-increasing data center architecture changes have tilted the balance in favor of outsourced colocations.

Colocation services have the facilities construction experience and pricing capacity by economies of scale to provide electricity, energy and cooling at rates that individual businesses who develop their own data centers cannot access and Colocation service providers that are operating their facilities considerably more effectively. The return-on - investment model no longer supports businesses that are developing their own vital project facilities.

Colocation and Managed Hosting Market Segment Analysis – By Geography

APAC region is anticipated to have the significant market growth at 14.7% during the forecast period 2021-2026. The market growth is owing to growing digitization, industrialisation technological developments, growing data centres and others. Moreover growing IT & Telecom segment is dominating the Colocation and Managed Hosting market. This is due to the increasing digitalisation and introduction of technologies such as big data and cloud in this field. Such developments pose a high challenge to data storage and availability.

Colocation and Managed Hosting Market Drivers

Better Uptime Reliability

Uptime flexibility can vary from provider to provider, but if the facility has a strong track record, this could be one of the excellent advantages of colocation. For example, a colocation data centre with an established record of > 99,99999 percent uptime reliability encounters less than 3.15 seconds of downtime over the course of a year.

Improved Resource Allocation

The outsourcing of data centre services to a colocation facility frees up precious IT power, enabling a company to rely more on research and development rather than on an ongoing basis learning the ins and outs of its network. Money that may have been invested on running a data centre might go into market analysis or product creation, providing additional ways for corporations to make the most of their current capital and achieve their business objectives.

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Colocation and Managed Hosting Market Challenges

High installation cost

Constructing a private data centre is clearly a major capital investment, but after the building is finished the expenses will not end. The day-to-day operation of a data centre incurs a substantial amount of recurring maintenance costs. Colocation hosting needs higher start-up costs than if the hosting firms hire servers. They have to buy hardware and upgrades on their own. Instead of bandwidth, budgeting gets frustrating with fluctuating monthly leases. Maintenance limitations on time or money.

Colocation and Managed Hosting Market Landscape

Partnerships and acquisitions along with product launches are the key strategies adopted by the players in the Colocation and Managed Hosting market. As of 2019, the market for Colocation and Managed Hosting market is consolidated with the top players including Equinix, Inc., Rackspace, Interxion Holding NV, CenturyLink Technology Solutions, Navisite, Inc., Verizon Communication Ltd, NTT Data Corporation, Global Switch Corporation, KDDI Corporation, Digital Reality and among others.

Acquisitions/Technology Launches/Partnerships

In October 2019, Adani Group ('Adani'), India's $13 billion multinational corporate empire, has revealed today that it is collaborating with San Francisco-based Digital Realty (NYSE: DLR), the world's largest regional supplier of data centre, positioning and interconnection solutions

In July 2019, INTERXION HOLDING NV has confirmed that it has been appointed as a placement provider for the NVIDIA DGX-Ready Data Center system. Interxion is also one of the first of a growing generation of European partners to bear this award. The software provides a certified network of artificial intelligence (AI)-ready data center solutions for clients operating an AI architecture based on NVIDIA DGX platform.

Key Takeaways

In developing countries construction of IT infrastructure is driving the sector. Increasing development of hyper scale facilities with a production capability of more than 50 MW would intensify the need for advanced business infrastructure globally in developing countries over the next few years.

APAC region is anticipated to dominate the global Colocation and Managed Hosting market in the forecast period 2021-2026 owing to growing digitization, technological developments, strategic collaborations and others.

Related Reports :

A. Multi-tenant Data Center Market

B. Data Centre as a Service Market

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