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5G, Edge Computing, and Expanding Connectivity Power Transformational Growth
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The next decade will witness an explosion of data due to increased levels of technology deployment across the globe; this will drive the need for processing and storing data and require the construction of both large and small data centers. The advent of 4G and 5G networks and the deployment of Industry 4.0 technologies and Internet of Things (IoT) devices have caused a steady flow of data generation. Moreover, 5G deployments with increased speeds drive higher data creation that enables deployment of edge and micro data centers.Asia-Pacific (APAC) and North America will see robust growth as companies in these regions invest in hyperscale and edge data centers. China and the United States will vie for global leadership in the technology space, which will drive the demand for and construction of smart data center technologies in both regions. The trend to move data processing closer to customers will drive adoption of edge data centers whereas artificial intelligence (AI) and automation will increase efficiency and reduce operational costs for operators. The main investments are driven by large US technology firms followed by regional telecom and technology firms that aim to capture a greater share of the domestic market. Companies will also shift toward adopting renewable energy as they try to reduce carbon emissions from their facilities. This will lead to increased corporate purchase of renewable energy in various developed and developing markets globally.The total investment in data centers is expected to increase from $ 244.74 billion in 2019 to $ 432.14 billion in 2025 at a compound annual growth rate (CAGR) of 9.9%. Frost & Sullivan forecasts the market to drop in 2020 due to the COVID-19 pandemic, with growth restarting in 2021 onwards. Enterprise data centers will account for an increasingly high proportion of data center investment followed by cloud, which will overtake enterprise data centers in investment by 2025.Data center market trends have been analyzed for the study period of 2018 to 2025, using a base year of 2019. The study covers enterprise, cloud, and colocation data centers including investments in each segment. It also includes investment by key cloud and colocation providers.
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