In the coming years, the information technology (IT) and telecom sector will be the largest user of data center colocation solutions due to the increasing penetration of improved technologies like IoT, AI, and cloud computing. Their adoption results in the generation of a large volume of data, which requires efficient storage. To securely store and manage this voluminous data, IT and telecom companies are rapidly taking data center space on rent. Apart from their low operational and capital costs, data colocation centers also enable high-speed data transmission.
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Since such new IT technologies are generally adopted in North America first, according to PS Intelligence, it will continue to be the most-lucrative region for firms offering data center colocation solutions. This will additionally be due to the existence of a vast number of data centers and colocation solution providers in the region. Leading technology firms like Amazon.com Inc., Google LLC, and Facebook Inc. have their headquarters and are expanding their foothold in the region.
Owing to this expansion, there has been a surge in the volume of data, which is why they are availing colocation services for effectively managing their business information and IT infrastructure. Following in the footsteps of North America, the APAC data center colocation market will witness the fastest growth in the foreseeable future, due to the continuous developments in the healthcare and IT and telecom industries of emerging economies.
An umpteen number of IT firms across the globe outsource work to companies based in APAC, which is leading to a rapid increase in the demand for data storage space and temporary servers. Moreover, the high cost of electricity, internet protocol (IP) transit, and space makes it unviable for regional companies to maintain their own data centers, thereby fueling the demand for colocation services.
Thus, the rising focus on cost-effective storage and management methods for the voluminous data being generated due to the rapid digitization will boost the requirement for data colocation services in the coming years.
