Modular Data Center Market

Modular Data Center Market Outlook from 2024 to 2034

The modular data center market is valued at USD 25 billion in 2024 and is projected to reach USD 135 billion by 2034, exhibiting a CAGR of 18.3% over the forecast period.

Key Market Drivers:

The modular data center market generated an estimated revenue of USD 12,507.03 million in 2019. The market grew at a 14.68% CAGR from 2019 to 2023 and added a revenue of USD 9127.34 million. Several reasons can be attributed to this growth:

• The surge in data traffic and the need for efficient data management in large-scale enterprises to offer scalability and adaptability
• The rising adoption of edge computing necessitates localized data processing to reduce latency and enhance real-time processing
• Increasing demand in organizations seeking scalable and flexible IT solutions to adapt to changing business requirements
• Rapid deployment capabilities of modular data centers meet the demand for quick setup and operational readiness in dynamic business environments.
• The evolution of edge networking trends, where data processing occurs closer to the data source in real-time
• Expansion of cloud services, prompting the need for modular data centers to support distributed and hybrid cloud architectures
• Increased awareness of the importance of disaster recovery and business continuity plans in ensuring uninterrupted business operations

Attributes	Key Statistics
Modular Data Center Market Size (2024)	USD 25 billion
Anticipated Market Value (2034)	USD 135 billion
Value-based CAGR (2024 to 2034)	18.3%

Consumption Analysis of the Modular Data Center Market

• Modular data centers have gained immense popularity in large-scale businesses and corporations as they use them to support their IT infrastructure needs, allowing for scalability and adaptability.
• Modular data centers are also in great demand among companies offering cloud services. These companies use modular data centers to expand and optimize their cloud infrastructure to meet the growing demand for scalable computing resources.
• Sales of modular data centers among telecom operators have seen a tremendous rise in the last few years. These entities utilize modular data centers to support the increasing data traffic and edge computing requirements in their networks.
• The adoption of modular data centers in government agencies is also touching the skies worldwide. These units deploy modular solutions for secure and efficient data processing, storage, and management, enhancing public services and operations.
• Banks and financial services firms also employ modular data centers to enhance their data processing capabilities to ensure secure and efficient financial transactions.

Restraining Factors Adversely Affecting the Modular Data Center Market

The modular data center market is anticipated to surpass a global valuation of USD 135 billion, growing at a CAGR of 18.30% through 2034. While the market is expected to experience remarkable growth, several factors act as challenges for the industry providers:

• The initial investment required to install modular data centers is the largest deterrent keeping small and medium businesses and corporations away from the market.
• There are still some concerns regarding the reliability and robustness of modular solutions compared to traditional data centers. This skepticism slows down their adoption, particularly in industries with stringent uptime requirements.
• Resistance to change is another major factor adversely affecting the market growth. Organizations with established data center infrastructures often resist transitioning to modular solutions due to inertia and perceived complexities.
• A shortage of skilled workforce well-versed in modular data center technologies, also limits the adoption of these centers, particularly in regions where such expertise is scarce.

Category-wise Insights

Independent Module Containers Dominate the International Marketplace

Depending on the component, the modular data center market is bifurcated into solutions, independent module containers, all-in-one containers, etc. The independent module containers segment dominates the market and is anticipated to hold a market share of 55.50%.

• Large-scale businesses prefer independent module containers as they isolate applications from the underlying system, enhancing security by reducing the impact of vulnerabilities and conflicts.
• They also enable easy scaling of applications by allowing them to be broken down into smaller, manageable modules.
• Independent module containers are also in great demand as they facilitate the implementation of DevOps practices by providing a consistent environment for development, testing, and production.
• The adoption rate of these containers is also surging among the developers as they allow them to work on specific components of an application without affecting other parts.
• Their demand is also attributed to the efficiency these containers provide, making the host operating system's kernel lightweight and efficient.

Popularity of Mid-sized Modular Data Centers

Attributes	Details
Top Data Center Size	Mid-Sized Data Centers
Market Share	51.00%

The modular data centers market is categorized into small, mid, and large-sized data centers based on the data center size. The mid-sized data centers segment dominates the market and is anticipated to hold 51.00% of the market share during the forecast period.

• Mid-sized data centers are increasingly adopting modular data centers as they allow for scalable expansion by adding prefabricated modules, enabling organizations to increase capacity based on demand incrementally.
• These data centers also offer flexibility in design and customization, allowing organizations to choose modules that best suit their specific requirements.
• The portability and self-contained nature of modular data centers make them suitable for deployment in remote or challenging locations. This is advantageous for mid-sized enterprises with distributed operations.

Country-wise Insights

The section provides an analysis of the modular data centers market by country, including Australia, China, the United States, Germany, and Japan. The table presents the CAGR for each country, indicating the expected progress of the market in that country through 2034.

Countries	CAGR through 2034
Australia	21.80%
Japan	19.60%
China	18.80%
Germany	17.8%
The United States	15.20%

Modular Data Center Market in Australia

Australia is one of the leading countries in this market. The Australian modular data center market is anticipated to retain its dominance by progressing at an annual growth rate of 21.80% till 2034.

• The Australian continent has vast, remote areas where traditional data center construction is logistically challenging. This has generated significant demand for modular data centers as they can be easily transportable and can be deployed in these remote locations.
• The demand for effective data processing and storage capacity technologies in Australia is experiencing a tremendous surge. Modular data centers offer a scalable solution that suits these evolving business needs.

Modular Data Center Market in Japan

Japan is leading the market in Asia. The Japanese market is anticipated to retain its dominance by progressing at an annual growth rate of 19.60% till 2034.

• Japan’s geographical location makes it prone to numerous earthquakes and tsunamis annually. The demand for modular data centers in the Japanese marketplace is rising as they are designed with earthquake-resistant features and allow for quick recovery and reconstruction in the aftermath of seismic events.
• Japan also has limited space, especially in cities like Tokyo, Osaka, and Kyoto. Modular data centers provide a compact and space-efficient solution while simultaneously allowing efficient use of available real estate.

Modular Data Center Market in China

In the Asian region, China is another country with potential for market growth. The Chinese modular data center market is anticipated to exhibit a CAGR of 18.80% till 2034.

• The Chinese government has supported the growth of the data center industry. Policies and initiatives that encourage the development of modular data centers contribute to the market's expansion.
• In the last few years, China has also gone through tremendous urbanization. Modular data centers offer a quick and scalable solution to meet this demand, allowing for faster deployment compared to traditional construction methods.

Modular Data Center Market in Germany

Germany is the leading country in the modular data center market in the European region. The German modular data center market is anticipated to register a CAGR of 17.80% through 2034.

• Germany is a leader in integrating Industry 4.0 in manufacturing and automation. The demand for these data centers is rising as they support the data processing requirements of smart factories, providing a scalable and efficient solution as industries embrace advanced technologies.
• Germany places a significant emphasis on data protection and sovereignty. Modular data centers, with their customizable and secure designs, provide a solution that addresses these concerns by allowing businesses to maintain control over their data.

Modular Data Center Market in the United States

In the North American region, the United States leads the modular data center market. Over the next ten years, the market is projected to rise at a 15.20% CAGR through 2034.

• The United States is prone to natural disasters such as hurricanes and wildfires. With their portability and redundancy features, modular data centers provide an effective solution for disaster recovery, ensuring business continuity in the face of unexpected events.
• Another major driver for the market’s growth is the fast-paced nature of technology adoption in the country. By leveraging these data centers, companies scale their infrastructure in response to evolving market trends.

Competitive Landscape

The global modular data centers market is filled with key players such as CUPERTINO ELECTRIC INC., Dell Delta Power Solutions, Eaton, Hewlett Packard Enterprise Development LP, Huawei Technologies Co. Ltd., Inspur Technologies Co. Ltd., IBM Corporation, etc. These companies are investing in continuous research and development to enhance modular data center technology. They are also focusing on providing scalable solutions that cater to the varying needs of different industries and businesses.

Recent Developments

• In August 2023, Schneider Electric and Compass Datacenters collaborated to enhance production capabilities for modular data centers. The partnership involved the construction of a 110,000-square-foot facility in the United States, integrating Schneider's power management equipment with Compass's prefabricated modules to expedite deployments.
• In November 2023, Vertiv, the US-based digital infrastructure solutions manufacturer, unveiled TimberMod, a modular wooden data center concept. This sustainable solution reflects a commitment to reducing carbon footprints and assisting organizations in achieving their sustainability objectives.
• On January 18, 2024, Sonic Edge, a UK data center module provider, successfully deployed a 100kW MegaPod, featuring Submer immersion tanks, to Castrol's Berkshire research site. The immersion cooling pod enhances efficiency and marks a significant advancement in data center technology.

Key Companies in the Market

• Schneider Electric
• Hewlett Packard Enterprise (HPE)
• IBM Corporation
• Dell Technologies
• Vertiv
• Eaton Corporation
• Huawei Technologies Co., Ltd.
• Cisco Systems, Inc.
• Rittal GmbH & Co. KG
• Cannon Technologies Ltd.
• Flexenclosure AB
• BladeRoom Group Ltd.
• CommScope
• Stulz GmbH
• Baselayer Technology, LLC
• SGI (Silicon Graphics International)
• Iron Mountain Incorporated
• Aceco TI
• Hanley Energy
• Canovate Group

Market Segmentation

By Component:

• Solutions
• All-in-one Containers
  • 20-Feet Containers
  • 40-Feet Containers
  • Customised Containers
• Independent Module Containers
  • IT Modules
  • Power Modules
  • Cooling Modules
• Services

By Data Center Size:

• Small Data Centers
  • Micro
  • Others
• Mid-Sized Data Centers
• Large Data Centers

By Industry Vertical:

• BFSI
• Telecom and IT
• Energy
• Government and Defence
• Manufacturing
• Research
• Healthcare
• Others

By Region:

• North America
• Latin America
• Europe
• Asia Pacific
• Middle East and Africa

Frequently Asked Questions

What is the Valuation for the Modular Data Center Market?

The global modular data center market is expected to be worth USD 25 billion in 2024.

What is the Sales Forecast for Modular Data Centers Through 2034?

The market for modular data centers is expected to reach USD 135 billion by 2034.

At What Rate is the Modular Data Center Market Growing?

The modular data center market is growing at a CAGR of 13.80% from 2024 to 2034.

Which are the Key Manufacturing Companies in the Market?

Some of the key players in the market are CUPERTINO ELECTRIC INC., Dell Delta Power Solutions, Eaton, Hewlett Packard Enterprise Development LP, etc.

Which is the Leading Modular Data Center Segment by Component?

Independent module containers dominate the market with a 55.5% share.