DATA CENTER COLOCATION MARKET ANALYSIS

One of the key challenges in the global data center colocation market is the limited control that customers have over the infrastructure and lack of customization options. When customers opt for colocation services, they have to manage their IT infrastructure within the hosted facilities of the colocation providers. This means that they do not have full control over factors like power infrastructure, temperature and humidity controls, security systems, and others. They have to work within the predefined parameters set by the colocation data centers. Additionally, most colocation providers offer standardized rack space and power configurations. This limits customization as per the specific infrastructure requirements of the customers. For complex workflows that require dedicated hardware or customized configurations, off-the-shelf colocation may not be suitable. This restricted control and lack of flexibility poses challenges for customers that have very specific infrastructure needs for their mission-critical applications and workloads.

Market Opportunities: Adoption of cloud and rising demand for dedicated hosting

One of the major opportunities for the global data center colocation market is the rising adoption rates of cloud-based services among organizations globally. As more businesses migrate their infrastructure and applications to the cloud, it is leading to an increase in the demand for colocation services. This is because hyperscale cloud providers like AWS, Microsoft Azure, etc. rely on third-party data center services to host their cloud infrastructure. The growing popularity of cloud and increased reliance on it by businesses is directly driving the need for colocation space and power. At the same time, there is rising demand from companies for dedicated hosting infrastructure that can offer higher level of control and scalability compared to shared hosting plans. This represents a lucrative opportunity for colocation providers to expand their portfolio through customized dedicated server solutions tailored to support mission-critical hosting requirements.