GREEN IT SERVICES MARKET ANALYSIS

Green It Services Market Size and Trends

Global green IT services market is estimated to be valued at USD 26.83 Bn in 2024 and is expected to reach USD 84.71 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 17.8% from 2024 to 2031.

Discover market dynamics shaping the industry: Request sample copy

Green IT services aim to reduce the harmful effects of IT on the environment through more efficient infrastructure, systems and processes. There is a growing demand for green IT services as organizations focus on reducing carbon footprint and energy costs through initiatives like remote monitoring and management of IT assets, recycling/reusing of end-of-life equipment, and optimizing data center efficiency. With increasing concerns around climate change, regulatory pushes for environmentally-friendly practices and cost benefits of going green, more companies are expected to incorporate green IT strategies and invest in associated services in the coming years.

Reducing operational costs

Adopting green IT initiatives helps organizations to reduce their operational costs in multiple ways. As energy efficient equipment like servers require less power, it leads to lower electricity bills. Many organizations have reported energy savings in the range of 15-30% by deploying technologies like virtualization. Apart from direct energy costs, green IT also brings down other overhead expenses such as cooling and maintenance needs. Data centers consume a lot of power for cooling servers and related infrastructure. Green IT-enabled solutions like free cooling techniques and use of more efficient hardware decrease these ancillary operating costs. Furthermore, energy efficient data centers need less physical space that translates to savings on real estate as well.

Organizations are also finding that green IT practices allow better asset utilization. With virtualization, servers can be consolidated leading to fewer physical devices needing maintenance. This reduces spending on spare parts, service contracts and staff time spent on repairs. Electronic waste management is another area where green IT delivers cost benefits. By extending product life through repair and reuse or ensuring responsible recycling, firms can avoid penalties for improper e-waste disposal. Some jurisdictions even offer tax incentives or provide subsidies toward greening IT operations. Te total cost of ownership of IT infrastructure tends to be lower when implemented following green principles. This makes green IT an attractive proposition for businesses seeking to optimize technology expenditures.

Market Concentration and Competitive Landscape

Get actionable strategies to beat competition: Request sample copy

Regulatory compliance and social responsibility

Many countries and local governments have instituted regulations to curb carbon emissions and promote sustainability due to growing awareness about environmental protection.  There are laws mandating reporting of energy usage and carbon footprint as well as penalties for non-compliance. Adopting green practices enables organizations to meet these legislative obligations efficiently. It also helps prepare for any future tightening of norms around areas like hazardous waste disposal. Being greener enhances an entity's public image and brand value as a responsible corporate citizen. Customers are inclined to choose businesses demonstrating ethical standards as well as reducing their own carbon footprint through supply chain partners committed to sustainability.

Employees, particularly younger workforce, prefer working for employers who are environmentally and socially conscious. Highlighting green IT initiatives can attract and retain top talent. Investors also look favourably on companies integrating CSR initiatives into core operations and strategies. This improves access to funding from socially-driven investors. Various certification programs recognize and reward environmental stewardship. For instance, in June 2021, Microsoft, Accenture, and Goldman Sachs announced a partnership with nonprofits, including the Linux Foundation and climate groups. The partnership aims to develop and share methods for creating software that produces fewer carbon emissions when operated in data centers.

Key Takeaways from Analyst:

Global green IT services market is expected to witness significant growth in the near future. Growing concerns around carbon emissions and environmental sustainability are prompting companies across industries to adopt green initiatives. This is expected to boost demand for services that help organizations reduce their carbon footprint and optimize resource consumption through data center consolidation, virtualization, and energy-efficient infrastructure. North America dominates the market, owing to strict regulations and an emphasis on sustainable business practices among enterprises in the region. Europe is also an important market supported by initiatives like the EU Code of Conduct on Data Centre Energy Efficiency.

However, budgetary constraints is  a key restraint for small and medium enterprises adopting green services. Service providers will need to focus on offering customized and cost-effective solutions to drive broader adoption. The market also faces challenges around the lack of industry standards for measuring carbon reductions and benchmarking the environmental impact of IT infrastructure. Adoption in developing regions could be slower than expected due to lower priority on sustainability compliance.

 Assisting organizations across industries to digitally transform their operations and leverage technologies like cloud, automation, and analytics to improve efficiency can offer growth opportunities. Green service providers can help customers achieve sustainability goals while optimizing costs. Increased focus on environmental governance will also likely accelerate demand from sectors like manufacturing, transportation, utilities, and healthcare over the long run.

Market Challenges: Overcoming Adoption Barriers in the Green IT Services Market

Global green IT services market faces  major challenges in terms of adoption by businesses. Many IT managers are hesitant to adopt more energy-efficient practices due to high upfront costs. There is also an lack of awareness about potential long-term savings and benefits. Convincing businesses about the monetary and environmental impact requires extensive education campaigns along with measurable case studies.

Market Opportunities: Emerging Revenue Streams in Virtualization, Energy Management, and Efficient Data Centers

There are substantial opportunities for the market growth as more businesses are seeking ways to reduce their energy consumption and carbon footprint. Government regulations and industry initiatives are also helping raise awareness. As technologies improve and costs come down, green IT practices will become more mainstream. The demand for services in virtualization, energy management software, efficient data centers presents a big revenue stream. Companies adopting green early will gain competitive advantages in terms of cost savings and brand image.

Discover high revenue pocket segments and roadmap to it: Request sample copy

In terms of By Type- Software segment contributes the highest share, owing to increased demand for eco-friendly digital solutions

By type, software segment is estimated to hold the largest market share of 64.8% in 2024, due to growing need for more sustainable software products and platforms. As companies and consumers become increasingly conscious of reducing their environmental footprint, there is demand for software that enables remote working, paperless processes, and streamlined operations.

Green software solutions allow organizations to optimize their IT infrastructure, enabling more efficient use of computing power and data center resources. Virtualization technologies has witnessed widespread adoption, as these allow servers and storage to be consolidated for higher utilization rates. Cloud-based platforms also hdecrease hardware requirements through centralized computing. Software-as-a-Service models have gained favor as these eliminate unnecessary local installations and updates.

Energy monitoring and management software provides enterprises visibility and control over their IT asset energy usage. These tools collect data from different systems to identify energy-intensive processes and equipment. These also support implementing power saving policies like automated shutdown of idle servers, adjusting CPU speeds, and switching to energy-efficient modes. Many software vendors are integrating these capabilities into their product roadmaps to appeal to eco-conscious buyers.

Regulations in various countries now mandate reporting on organizations' carbon footprints. Green software enables accurate measurement and reporting of IT-related emissions. These capture metrics like power consumed by hardware, business travel miles, paper usage, and others to satisfy compliance requirements. The data can also be leveraged to benchmark performance and optimize processes over time.

As environmental sustainability gains priority globally, there will be huge demand for green digital solutions. Vendors are expected to invest more in developing products that are not just efficient but also help customers lower their carbon footprint through remote working and paperless practices. The advantages of decreased costs, regulatory compliance and enhanced brand reputation will sustain software's position in the dreen IT services market.

For instance, in September 2022, IBM a technology company announced plans to acquire Dialexa, a leading U.S.-based digital product engineering services provider, to help enterprises drive innovation and achieve digital growth. This acquisition is expected to enhance IBM's product engineering capabilities and offer comprehensive digital transformation services to clients.

In Terms of Industry Vertical - IT and Telecom segment contributes the highest share due to energy management priorities

By industry vertical, IT and telecom segment is estimated to hold the largest share of 47.3% in 2024, due to the huge energy consumption of data centers and telecom networks, which are critical IT infrastructure for these companies. With rising energy bills and pressures to reduce carbon footprint, optimizing resource usage through green technologies is a top priority.

Data centers housing thousands of servers require massive amounts of power for operations. Even small improvements in efficiency can result in sizable cost savings. Green IT services help operators monitor and manage energy usage more effectively. Solutions like automated workload scheduling and virtualization optimize server utilization to decrease physical hardware. Cooling systems and power infrastructure are also evaluated to eliminate wastage.

For telecom networks powering billions of connected devices, renewable energy is playing a key role. Green IT consulting supports deployment of solar panels and energy storage at cellular towers and exchanges. Remote monitoring and maintenance reduces need for physical visits and fuel consumption. Network modernization projects upgrading copper cables to fiber-optic lines further boost power efficiencies.

With increasing digitization across sectors, the IT and telecom industry's carbon footprint is expanding rapidly. Adopting an eco-friendly approach helps to gain a competitive edge through lower energy bills and sustainable business practices. It also strengthens alignment to corporate social responsibility goals. Thus,  green services catering to data center and network optimizations can drive the segment growth in the market.

Regional Insights

To learn more about this report, Request sample copy

North America has established itself as the dominant regional market for green IT services with the estimated market share of 37.12% in 2024. The region boasts a strong presence of global tech giants who have set up large green data centers and adopted energy-efficient IT practices. Stringent government regulations related to energy consumption and carbon emissions have propelled businesses to optimize infrastructure through green technologies. With many prominent firms embracing remote working models over the past years, the need for managed services around server virtualization, cloud migration, and laptop fleet management has increased. This has translated into higher revenues for vendors providing green software and consulting. North American firms are at the forefront of sustainability reporting and gaining competitive edge through carbon reduction initiatives, thus, driving considerable spend on green solutions.

Asia Pacific region excluding Japan (APAC ex-Japan) market has emerged as the fastest growing market for green IT services with CAGR of 19.58% for the forecast period of 2024-2031. Rapid digitization and growing infrastructure development across industries are fuelling the demand. Countries like China and India have published national plans targeting expansion of renewable energy resources to fulfil widespread computing needs. This has opened up opportunities for deployment of green-enabled infrastructure. Furthermore, relaxed norms around special economic zones and start-up encouragement are allowing new players to establish and offer eco-friendly offerings. Established global service providers are also aggressively scaling their presence by acquiring regional firms and setting up dedicated innovation centers.

Market Report Scope

Green It Services Industry News

• In April 2022, Johnson Controls which is a fire, HVAC, and security equipment manufacturer, commissioned a new heat pump installation to support Vattenfall, a European energy company, in its goal to eliminate carbon emissions from its heating and power generation facilities by 2050
• In April 2022 at the Huawei Global Analyst Summit (HAS) 2022, Huawei which is a manufacturer of information and communications technology (ICT) infrastructure and smart devices, introduced the "Green and Low Carbon" concept for its Huawei CloudFabric 3.0 Hyper-Converged Data Center Network (DCN) Solution. This solution aims to use lossless networks to enhance computing efficiency, reduce the computing footprint, and promote green computing.
• In February 2022, Super Micro Computer, Inc. (SMCI), a provider of high-performance computing, storage, networking solutions, and green computing technology, launched a new short-depth multi-node system optimized for 5G, IoT, and Edge applications. This system is designed for high-density computing and I/O requirements in small form factor or field locations, such as cell tower bases or high-traffic areas.

*Definition: Green IT Services Market provides energy-efficient and eco-friendly solutions to help organizations lower their carbon footprint and promote sustainability through green data centers, power management services, virtualization solutions, and other initiatives. Companies in this market offer consulting, auditing and optimization services focusing on reducing energy consumption of IT assets, promoting recycling and reuse, implementing clean technologies, and enabling organizations to meet their environmental goals through more efficient use of IT resources.

Market Segmentation

• Type Insights (Revenue, USD Bn, 2019 - 2031)
  • Software
  • Services
    • Professional Services
      • Consulting
      • Integration and Deployment
      • Support and Maintenance
    • Managed Services
•  Industry Vertical Insights (Revenue, USD Bn, 2019 - 2031)
  • BFSI
  • IT and Telecom
  • Industrial
  • Healthcare
  • Retail
  • Others
• Regional Insights (Revenue, USD Bn, 2019 - 2031)
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Argentina
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • France
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • South Korea
    • ASEAN
    • Rest of Asia Pacific
  • Middle East & Africa
    • South Africa
    • GCC Countries
    • Rest of Middle East & Africa
• Key Players Insights
  • Accenture PLC
  • Accuvio Sustainability Software
  • Cority Software Inc.
  • Dakota Software
  • Enablon Sa
  • Enviance Inc.
  • Green IT Consulting
  • Green Step Solutions
  • HJS Technology
  • IBM Corporation
  • Johnson Controls
  • SAP SE
  • Schneider Electric SE