DUBLIN--(BUSINESS WIRE)--The "Middle East & Africa Data Center Colocation Market - Industry Outlook & Forecast 2024-2029" report has been added to ResearchAndMarkets.com's offering.
The Middle East & Africa Data Center Colocation Market was valued at USD 2.98 billion in 2023, and is projected to reach USD 5.74 billion by 2029, rising at a CAGR of 11.54%.
Datacenter investors comprise major vendors such as Gulf Data Hub, Equinix, Khazna Data Centers, Digital Realty, Center3 (stc), Ooredoo, Africa Data Centres, Batelco, iXAfrica Data Centres, Moro Hub, MedOne and others. Prominent investors such as Agility, Compass Datacenters, EDGNEX Data Centres by DAMAC, Pure Data Centres (Pure DC), Nxtra by Airtel, and others are new entrants in the Middle East and Africa data center colocation market. Due to this, there is a decent possibility of them disrupting the market by proving to be major competitors to existing vendors and carrying with them the added advantage of having a generous customer base who will likely follow them to this region as well, bringing in more revenue and expansion in this market.
Global operators such as Equinix and Digital Realty entered the Middle East and Africa data center colocation industry through the acquisition of local colocation operators. For instance, Equinix entered the African data center market through the acquisition of the data center portfolio of MainOne for around USD 320 million in 2022. Accordingly, in 2022, Digital Realty acquired around 55% stake in the data center business of Teraco in South Africa to enter the market.
MARKET TRENDS
Rise in Adoption of Renewable Energy
The MEA region experiences a significant rise in the adoption of renewable energy sources, driven by both environmental concerns and economic opportunities. Countries such as Saudi Arabia and the UAE lead the way with ambitious renewable energy projects. For instance, the NEOM project in Saudi Arabia aims to develop a sustainable city powered entirely by renewable energy, while the Mohammed bin Rashid AI Maktoum Solar Park in UAE is one of the largest solar parks in the world. Furthermore, South Africa witnessed the rise of renewable-powered data centers like Digital Realty (Teraco's) data center facilities in Johannesburg and Cape Town where solar energy is utilized to complement their energy requirements. Nigeria also witnesses a shift toward renewable energy for data centers, with companies like Equinix (MainOne) investing in solar-powered data centers to ensure reliable and sustainable operations.
Increase in Adoption of AI
The MEA region experiences a notable increase in the adoption of AI, driven by technological advances and growing recognition of its transformative potential across various sectors. Countries such as UAE, Saudi Arabia, and Kenya are at the forefront of AI integration, with initiatives spanning healthcare, finance, transportation, and more. Such factors are projected to support the Middle East and Africa data center colocation market growth. For instance, the UAE has launched the "UAE Strategy for Artificial Intelligence" to position itself as a global leader in AI by 2031. Similarly, the National AI Strategy in Saudi Arabia aims to drive economic growth and enhance quality of life through AI-driven innovation.
Smart Cities Development
Smart city initiatives are rapidly gaining momentum across the MEA region, driven by the desire to enhance urban living, promote sustainability, and stimulate economic development. Countries such as the UAE, Saudi Arabia, and Qatar are leading the charges with ambitious projects aimed at leveraging technology to improve infrastructure, transportation, and public services. In Dubai, initiatives like the Smart Dubai 2021 strategy aim to transform the city into a global hub for innovation through the integration of advanced technologies like AI, IoT, and blockchain. Similarly, the NEOM project in Saudi Arabia is one of the most highly anticipated smart cities in the world, that is likely to cost Saudi Arabia about USD 500 billion and is set to take the world by storm when it becomes operational by 2025.
SEGMENTATION INSIGHTS
The Middle East and Africa data center colocation market is segmented into three parts- electrical infrastructure, mechanical infrastructure, and general construction. They are interconnected and interdependent. In the Middle East and Africa data center colocation market, cooling systems, and techniques play a pivotal role owing to the harsh climatic conditions this region faces.
Crucial internal software and hardware such as servers, computing devices, and other equipment need to cool down as they work incessantly to manage millions of data center operations each day. Therefore, to keep these up and running, proper power backup facilities such as UPS systems and generators are needed. With this, the region can focus on sustainable ways to power them, through EcoDiesel, natural gas, biofuel, and other non-traditional sources. The overall facility also needs physical security and fire safety, ensuring the smooth running of the day-to-day activities without any external or internal threats. Most African data centers started adopting adiabatic cooling to save water, which can provide cooling even in the absence of chillers.
GEOGRAPHICAL ANALYSIS
The Middle East is a fast-paced market, with advances happening each day, it strives to be at par with other developed regions in the world. It has a high potential for growth in areas such as AI, smart cities, usage of sustainable energy resources, and so much more, encouraging more data centers to be constructed. The UAE and Saudi Arabia have emerged as market leaders of the region, equipped with sophisticated technology, cutting-edge safety/control systems, and a dominant Middle East data center colocation market share. Kuwait, Qatar, Bahrain, and Israel are also on the way to emerge as leaders in these fields, with developments happening gradually.
Similarly, the African region experiences rapid progress across various sectors, including AI, smart cities, and sustainable energy. Countries such as South Africa, Nigeria, Kenya, and Egypt invest significantly in these areas, positioning themselves as key players in the technological landscape of the region.
VENDOR LANDSCAPE
Data Center Investors
- 21st Century Technology
- Adgar Investments & Development
- Africa Data Centres
- Batelco
- Bynet Data Communications
- Center3 (stc)
- Digital Parks Africa
- Digital Realty
- EdgeConneX
- Equinix
- Galaxy Backbone
- Gulf Data Hub
- iXAfrica Data Centres
- Khazna Data Centers
- Medallion Communications
- MedOne
- MEEZA
- Mobily
- Moro Hub
- MTN Business
- NTT DATA
- Oman Data Park
- Ooredoo
- Open Access Data Centres
- Paratus Namibia
- Quantum Switch
- Rack Centre
- Raxio Data Centres
- Serverfarm
- Telehouse
- Telecom Egypt
- TONOMUS (ZeroPoint DC)
- Turkcell
- Turk Telekom
- Vantage Data Centers
- wingu.africa
New Entrants
- Agility
- Compass Datacenters
- Cloudoon
- EDGNEX Data Centres by DAMAC
- Kasi Cloud
- NED
- Nxtra by Airtel
- Pure Data Centres Group
KEY QUESTIONS ANSWERED
- How big is the Middle East and Africa data center colocation market?
- What is the growth rate of the Middle East and Africa data center colocation market?
- What is the estimated market size in terms of area in the Middle East and Africa data center colocation market by 2029?
- What are the key trends in the Middle East & Africa data center colocation market?
- How many MW of power capacity is expected to reach the Middle East and Africa data center colocation market by 2029?
Key Attributes:
| Report Attribute | Details |
| No. of Pages | 485 |
| Forecast Period | 2023 - 2029 |
| Estimated Market Value (USD) in 2023 | $2.98 Billion |
| Forecasted Market Value (USD) by 2029 | $5.74 Billion |
| Compound Annual Growth Rate | 11.5% |
| Regions Covered | Africa, Middle East |
Key Topics Covered:
Market Opportunities & Trends
- Rise in the Adoption of Renewable Energy Resources
- Data Center Investments Fueled by 5G Development
- Development of Submarine Cables and Inland Connectivity
- Data Center Investment Driven by Smart City Initiatives
- Increase in Adoption of AI
-
Major Factors Fueling the Need for Data Centers in the MEA
- Growth of Cities and Digital Hubs
- The Beginning of the Digital Transformation Era
- The Expansion of the Internet Economy
- Booming E-Commerce and Digital Services
- Changes in Industries and New Opportunities
Market Growth Enablers
- Data Center Investment Driven by Cloud Adoption
- IoT & Big Data Adoption
- Shift from On-Premises Infrastructure to Colocation & Managed Services
- Deployment of Modular Data Centers
Market Restraints
- Data Center Security Challenges
- Dearth of Skilled Workforce
- Location Constraint on Data Center Development
Segmentation by Colocation Type
- Retail Colocation
- Wholesale Colocation
Segmentation by Infrastructure
- Electrical Infrastructure
- Mechanical Infrastructure
- General Construction
Segmentation by Electrical Infrastructure
- UPS Systems
- Generators
- Transfer Switches & Switchgear
- PDUs
- Other Electrical Infrastructure
Segmentation by Mechanical Infrastructure
- Cooling Systems
- Racks
- Other Mechanical Infrastructure
Segmentation by Cooling Systems
- CRAC & CRAH Units
- Chiller Units
- Cooling Towers, Condensers & Dry Coolers
- Economizers & Evaporative Coolers
- Other Cooling Units
Segmentation by Cooling Techniques
- Air-based Cooling
- Liquid-based Cooling
Segmentation by General Construction
- Core & Shell Development
- Installation & Commissioning Services
- Engineering & Building Design
- Fire Detection & Suppression
- Physical Security
- DCIM/BMS Solutions
Segmentation by Tier Standard
- Tier I & II
- Tier III
- Tier IV
For more information about this report visit https://www.researchandmarkets.com/r/hp8lot
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