According to a recent study from market research firm Graphical Research, the North America data center server market size is expected to grow significantly during the forecast timeframe, owing to the rising need for strong data security and storage systems. Large-scale organizations leveraging advanced technologies, like IoT and AI, resulting in intense data traffic across various networks.
As per the Cisco Annual Internet Report, almost 5 billion networked devices/connections will be established in North America by 2023. This will be an increase from the 3 billion connections achieved in 2018. As MNCs in North America require a large-scale infrastructure for supporting the heavy flow of data traffic, the demand for a stable and high-performing data center server is expected to multiply.
Large-scale organizations like Cisco Systems, Inc., IBM Corporation, ATOS SE, Dell Technologies Inc., and NEC Corporation, among many others, are involved in creating advanced technologies for data center servers for turning them into smart machines. They are collaborating with other firms for acquiring their know-how and building efficient, robust, and high-performing data center infrastructure when it comes to handling large amount of data.
North America data center server market share will have a value of over $35 billion by 2027.
The following trends will help achieve this industry forecast during 2021-2027:
Increased hyperscale data centers installation:
North America is witnessing a considerable increase in hyperscale data center installation. These data centers can be huge and are specifically designed to support large-scale data operations in companies. Technology giants like Amazon, Google, IBM, Facebook, and Microsoft use hyperscale data centers to handle massive volumes of data.
Many cloud service providers in North America are setting up large data centers as top-performing firms here are extensively using their services. For example, Google LLC, in May 2021, announced its plans to purchase a property in Quebec, Canada for around $600 million for expanding its data center setup in the country. The demand for data center servers will increase to help hyperscale data centers handle huge workloads.
OTT services drive the demand for micro data center servers:
Considering the types of data centers, micro data center servers will be highly adopted by end-users in North America. Demand for over-The-Top (OTT) streaming services has increased among consumers in the region. For instance, there are around 73.9 million paid subscribers for Netflix Inc. in the U.S. and Canada as of February 2021.
The COVID-19 pandemic has changed the way entertainment is consumed and has compelled customers to choose online mediums, like Netflix, Amazon Prime, and Hulu. This has led to many companies in North America to set up micro data center servers for offering virtual streaming services at high speeds.
Large-scale commercialization of 5G networks:
The introduction of 5G technology and its growing commercialization have positively impacted the growth of data center server market in North America. The U.S. is expected to hold a dominant position in offering 5G technologies to its customers. Four telecom pioneers in the country, namely T-Mobile, DISH Wireless, Verizon Wireless and AT&T Mobility are implementing 5G networks on a large scale. The deployment of 5G technology has resulted in organizations creating advanced and high-capacity data center servers for managing a huge amount of data traffic every day.
Data center servers in the BFSI sector:
The BFSI sector in North America will set up data center servers for catering to the rising era of digital transformation. Online and contactless payments are becoming popular among customers in the region. For instance, most U.S. banks support Fitbit Pay, which allows clients to pay through their Fitbit device. The organizations of the BFSI sector are implementing advanced technologies for enhancing customer banking experience, resulting in the generation of heavy data traffic.
Banks and other financial institutions are investing heavily in large-scale data center infrastructure for enabling them to efficiently handle the massive flow of information. These data centers will help the users process and supply data safely and securely along with high flexibility in data operations. With the installation of the small, medium, and large-scale data centers growing at a notable pace in the region, the North America data center server market forecast is showing good progress. A wide variety of sectors such as IT & Telecom, BFSI, Healthcare, Government, Energy, and Manufacturing, and others are using rack, blade, tower, and micro data centers servers.