APAC DATA CENTER CONSTRUCTION MARKET

Asia-Pacific Data Center Construction Market is estimated to grow at a robust CAGR of 11.2% during the forecast period owing to robust digital transformation and a rise in cloud adoption.

Major APAC Data Center Construction Market Drivers and Emerging Trends

Data center construction in the Asia Pacific region offers an accelerated and streamlined interface for managing organizational data and human resources information. The growing adoption of cloud services, data localization requirements, and the rollout of the new technologies like IoT and 5G are boosting the data centers demand in the region. As of 2022, the Asia Pacific region hosted roughly 1,300 data centers, a number anticipated to grow in response to swift digitization and the expanding use of cloud services across industry sectors. The rapid proliferation of digitalization across verticals will fuel a growing necessity for data centers in Asia Pacific. In addition, the increasing deployment of submarine fiber strings in the APAC region is driving growth in the data center construction market, while simultaneously, the rising adoption of technologies such as cloud computing, IoT, and big data is fueling demand for robust broadband connectivity.

 The other factor supporting the expansion of APAC data center construction market size is the increased funding for research and development aimed at fostering innovations. A rise in strategic market partnerships is driving greater investment in automated and advanced technologies, specifically geared towards managing high volumes of unstructured and structured data. This expansion of investment in research and development capabilities is expected to foster innovations in IT solutions. The market will also benefit further from the increasing integration of machine learning and artificial intelligence, combined with the growth of remote working and digital transformation.

In addition, the complexities emerging in procurement create multiple opportunities for small-scale businesses and are poised to propel market growth. The escalating use of cloud computing, increasing uptake of new technologies, and businesses’ determined shift away from conventional methods and paperwork indicate a promising growth outlook.

Furthermore, there is also an opportunity to develop more sustainable data centers considering enhancements in computing power led to higher energy usage. Green data centers can promote eco-friendly initiatives by utilizing energy-efficient technologies to reduce carbon footprints. Startups are innovating cooling technologies and other thermal management solutions to enhance the ecological integrity of computing and recycling processes.

However, there are some challenges and restraints that can hinder APAC data center construction market industry outlook including significant upfront investment costs. Technology executives strive to achieve cost-effective data center solutions that deliver value while maintaining essential features intact. Utilizing available space for scaling data centers is a cost-saving approach commonly used by organizations, even though such measures may only provide short-term benefits. Meanwhile, establishing a data center that balances cost-effectiveness, high performance, and satisfactory ROI over the long term necessitates thorough planning.

Furthermore, APAC data center construction market report also observes potential disruption from emerging technologies like cloud computing, where this service provides businesses with internet-based computing storage which reduces traditional data center demand. Despite the emergence of new trends, there is anticipated growth in the requirement for physical data center construction, driven by the rising digital technologies adoption and the ongoing need for secure and scalable solutions for storing data. The market expansion is also fueled by the increasing need for large-scale data centers, which businesses are implementing to handle vast quantities of data.

Market Segmentation Analysis

APAC data center construction market can be categorized based on infrastructure type into electrical and mechanical infrastructure as well as general construction. Based on data center type, there are Tier 1 and 2, 3, and 4. Based on organization size, there are small, medium, and large size organizations. Meanwhile, in the vertical segment, there are banking, financial services and insurance, government and defense, IT and telecommunications, manufacturing, among others.

By tier type, the Tier 3 sector dominated the market share driven by heightened redundancy measures throughout data center facilities. Another factor contributing to the dominance of Tier 3 sector in the market is the increasing demand for high-performance computing and expanded storage capacities. The Tier 4 segment is also projected to expand as businesses in multiple sectors increasingly prioritize constant digital services and operational availability. Tier 4 data centers ensure the highest level of fault-tolerant capabilities and redundancy, ensuring continuity of critical services during component failures or maintenance activities. Meanwhile, the Tier 1 and 2 segments experience slower growth with over 70% of traffic flowing directly between servers. Modern applications demand faster data transfer speeds within centers and have lower latency tolerance.

Based on vertical type, the IT and telecom segment leads in market share largely driven by the widespread adoption of smartphones and the expanding base of internet users. The segment’s growth is expected to be fueled by the continued expansion of 5G networks and the integration of Network Function Virtualization and Software-Defined Networks for supporting OTT platforms and online gaming.

Top Market Players

Several notable players in the market include DPR Construction, AECOM, Schneider Electric, Arup, among others.

Segments covered in the Report:

The Asia-Pacific Data Center Construction Market has been segmented on the basis of tier type, infrastructure and vertical. Based on the tier type, the market is segmented into tier 1, tier 2, tier 3, tier 4. Based on the infrastructure, the market is segmented into cooling infrastructure, power infrastructure, racks and cabinets, servers, networking equipment, physical security infrastructure, design and consulting services, other infrastructure. The cooling infrastructure segment is further segmented into air-based cooling, liquid-based cooling, evaporative cooling. The power infrastructure segment is further segmented into ups systems, generators, power distribution unit (PDU). Based on the vertical, the market is segmented into it & telecom, BFSI, government & defense, healthcare, energy, others.

Report Coverage	Details
Market Revenues (2023)	USD Million
Market Base Year	2023
Market Forecast Period	2024-2031
Base Year & Forecast Units	Revenues (USD Million)
Market Segment	By Tier Type, By Infrastructure, By Vertical
Regional Coverage	Asia-Pacific
Companies Profiled	DPR Construction, AECOM, Schneider Electric, Arup, among others; a total of 4 companies covered.
25% Free Customization Available	We will customize this report up to 25% as a free customization to address our client’s specific requirements

Market Segmentation

Asia-Pacific Data Center Construction Market by Tier Type

• • Tier 1
  • Tier 2
  • Tier 3
  • Tier 4

Asia-Pacific Data Center Construction Market by Infrastructure

• • Cooling Infrastructure
    • Air-based Cooling
    • Liquid-based Cooling
    • Evaporative Cooling
  • Power Infrastructure
    • UPS Systems
    • Generators
    • Power Distribution Unit (PDU)
  • Racks and Cabinets
  • Servers
  • Networking Equipment
  • Physical Security Infrastructure
  • Design and Consulting Services
  • Other Infrastructure

Asia-Pacific Data Center Construction Market by Vertical

• • IT & Telecom
  • BFSI
  • Government & Defense
  • Healthcare
  • Energy
  • Others

Asia-Pacific Data Center Construction Market Leading players (Option 1: Free 25% Customization – Profiles of 5 Additional Companies of your Choice)

• • DPR Construction
  • AECOM
  • Schneider Electric
  • Arup