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Internet Data Center Global and Chinese Market (2021 to 2025)



Dublin, July 23, 2021 (GLOBE NEWSWIRE) — The “Global and China IDC (Internet Data Center) Market Insight Report, 2021-2025” report has been added to’s offering.

With a prosperous outlook for new technologies such as artificial intelligence (AI), big data and cloud computing, which are continually driving the digital transformation of modern businesses, we see a clear trend of data explosion ahead, together with the 5G ongoing deployment. According to Cisco Visual Networking Index, the global IP traffic should reach 396EB/month in 2022E compared to 122EB/month in 2017, recording a 27% CAGR. Meanwhile, the cloud market should continue its strong growing momentum with a clear path of cloud migration. The global cloud market size should reach USD364bn by 2022E, representing a 15% CAGR (according to Gartner) while the China cloud market should see a better growth rate and reach CNY375bn in 2023E, recording a 30% CAGR, according to CAICT. Therefore, we see the strong growth trend of data traffic and promising cloud business outlook pave the way for solid demand growth of IDC (internet data centers) business in the foreseeable future, considering IDC is the fundamental and critical support industry for all of the above.

Thanks to the continuing rapid development of the internet and cloud businesses, the China IDC market will likely post a 27% CAGR for 2019-22E, reaching a revenue of CNY320bn in 2022E, according to IDC Quan. While China operators currently remain the dominant players in this market (as China Telecom, China Unicom and China Mobile altogether represented 62% market share in 2019), we see a trend that carrier-neutral players are gradually gaining market shares, as well as increasing their presence and impact to the overall business ecosystem in future, considering their active business expansion and the potential strong demand arising from the market.

Meanwhile, within the IDC business supply chain, we believe equipment vendors could also be the potential beneficiaries of the trend, including server providers (HP, H3C, Inspur, etc.), network equipment suppliers (Huawei, Ericsson,H3C. etc.), optical fiber/module suppliers (YOFC, Hengtong Optic Electric, InnoLight, Accelink, etc.) and power/cooling equipment vendors (ABB, CommScope, Emerson, Schneider Electric, etc.). With potential rapid development of the IDC industry ahead, the cloud service providers, as the downstream of the IDC business, should achieve their long-term business targets smoothly, in our view.

Supply/demand imbalance persists; new infrastructure initiative to trigger another wave of rapid expansion of the IDC market

We have observed that in the global IDC market, business opportunities mainly arise in Tier-1 cities, while in China, majority of the data centers and racks are installed around four cities – namely Beijing, Shanghai, Guangzhou and Shenzhen. However, we continue to see an imbalanced supply/demand situation in the IDC industry. In China, IDC resources in Tier-1 cities have consistently been in short supply for years as a mixed result of limited resources and continuously growing demand.

Furthermore, we believe that energy and land resources have also become the major bottleneck for the IDC business to develop in these areas. While the central government is encouraging green energy in order to reduce air pollution by lowering carbon dioxide emissions, the fact is thermal power still represented 70% of the total power generated in 2019. As a result, we see the IDC business in Tier-1 cities is regulated from various aspects, including PUE (power usage effectiveness) limit, location constraints and size/number target. With such policies likely to continue going forward, we expect business development in Tier-1 cities and surrounding areas should continue to be the key for IDC companies in the future.

Meanwhile, since late 2018, the central government has mentioned that China should focus on building new infrastructure to support innovative business potential over the next few years. According to Xinhua Net, the new infrastructure initiative should include era-defining technologies and relevant infrastructure in seven key areas – as shown in the table below.

With these definitions and initiatives, we expect central and local governments to release a series of policies and guidance going forward, in order to stimulate the development of certain industries and set a positive tone for them, including the IDC and cloud computing business.

Key Topics Covered:

1 Data growth to drive the demand for IDC market
1.1 IDC provides the infrastructure for cloud computing
1.2 AI, big data, cloud, and 5G deployment should drastically increase data consumption and traffic1.3
1.3 Data center categories, market size and trend
1.4 Global cloud computing leaders’ capex trends
1.5 COVID-19 may trigger robust long-term demand for IDC business

2 IDC resource imbalance persists; new infrastructure initiative should trigger a wave of rapid expansion of IDC business in China
2.1 IDC resource supply and demand is imbalanced in China market
2.2 Latest IDC construction and acquisition trends

3 Different types of IDC businesses
3.1 In-house vs telecom operators vs carrier-neutral players
3.2 Retail vs wholesale business models
3.3 Long-term outlook for different types of business models

4 IDC market comparison: US vs China
4.1 Comparison with the US
4.2 Equinix as an example
4.3 REITs: future of IDC players in China?

5 IDC Market Demand in China
5.1 Plenty of Demand Upside
5.1.1 5G and Broadband Upgrade to Sustain Strong Consumer Internet Growth
5.1.2 3.5x Demand Growth by 2030 Without Meaningful Industrial Internet Yet
5.1.3 Industrial Internet Could Easily Boost Demand
5.1.4 China’s IDC vs Steel Industry
5.2 Risk of Excess Supply
5.2.1 Tight Power Allocation Effectively Controls Supply
5.2.2 2030E 90% Utilization of Modern Capacity, Still Conservative

6 Depth Analysis of Domestic Peers
6.1 Baosight Software
6.2 Shanghai AtHub
6.3 Dr. Peng Telecom
6.4 Chindata Group
6.5 21Vianet Group
6.6 Beijing Sinnet Technology Co, Ltd
6.7 Kingsoft Cloud Holdings
6.8 Unisplendour Corporation Limited
6.9 Aofei Data

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