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UK Data Center Market Analysis - Size and Forecast 2024-2028

UK Data Center Market Analysis - Size and Forecast 2024-2028

Published: Dec 2024 127 Pages SKU: IRTNTR72213

Market Overview at a Glance

$37.87 B
Market Opportunity
21.8%
CAGR
17.9
YoY growth 2023-2024(%)

UK Data Center Market Size 2024-2028 

The uk data center market size is forecast to increase by USD 37.87 billion, at a CAGR of 21.8% between 2023 and 2028.

  • The Data Center Market in the UK is experiencing significant shifts, driven by the increasing adoption of multi-cloud solutions and the necessity to upgrade networks to support the rollout of 5G technology. These trends reflect the evolving digital landscape, with businesses seeking greater agility, scalability, and efficiency in their IT infrastructure. Simultaneously, the consolidation of data centers continues, as organizations aim to optimize resources and reduce operational costs. However, these advancements come with challenges, including the growing power consumption demands of data centers, which necessitate sustainable energy solutions and innovative cooling technologies to mitigate environmental concerns and maintain cost competitiveness.
  • Companies in the UK data center market must navigate these trends and challenges to capitalize on opportunities for growth and maintain a competitive edge in the rapidly evolving digital economy.

What will be the size of the UK Data Center Market during the forecast period?

Data Center Market in UK Size

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  • The UK data center market is witnessing significant advancements, driven by the increasing demand for power-hungry tower servers and the shift towards renewable energy sources. With the expansion of data center footprints, IP addressing and data center certifications have become crucial for ensuring efficient network management. Green data centers, integrating cooling technology and energy management, are gaining traction as businesses prioritize sustainability. Server clustering, virtual machines (VMs), solid-state drives (SSDs), and storage arrays are key technologies enhancing data center performance. Location selection, risk management, and business continuity plans are essential considerations for organizations. Data analytics, wireless networking, and big data applications are fueling the adoption of high-performance computing (HPC) solutions, including blade servers and load balancing.
  • Fiber optic cables and Ethernet cables are vital components for seamless connectivity, while tape libraries and optical storage cater to data archiving needs. Sustainable data centers, employing energy-efficient rackmount servers and advanced cooling systems, are the future of the industry.

How is this market segmented?

The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD million" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

  • Component
    • IT infrastructure
    • Power management
    • Mechanical construction
    • General construction
    • Security solutions
  • Type
    • On-premise
    • Hyperscale
    • HPC
    • Colocation
    • Edge
    • On-premise
    • Hyperscale
    • HPC
    • Colocation
    • Edge
  • Design
    • Traditional
    • Containerized
    • Modular
    • Traditional
    • Containerized
    • Modular
  • Geography
    • Europe
      • UK

By Component Insights

The it infrastructure segment is estimated to witness significant growth during the forecast period.

The data center IT infrastructure market in the UK is experiencing significant growth due to the increasing demand for computing power and storage to accommodate expanding data traffic. Enterprises are transitioning from traditional on-premises data centers to cloud-based solutions, including hyperscale data centers and edge computing. Modular data centers and containerized data centers are gaining popularity for their flexibility and scalability. Network security and access control are essential considerations, with high-availability systems and disaster recovery solutions ensuring business continuity. Energy efficiency and liquid cooling are key trends, as are managed services, remote monitoring, and data center automation.

IT infrastructure solutions encompass server racks, network switches, cooling systems, and performance monitoring tools. Software-defined networking (SDN) and data center virtualization are crucial components, enabling temperature control, power capacity, and storage virtualization. Data storage and capacity planning require technical expertise, while backup and recovery solutions ensure business continuity. The market is also witnessing the adoption of hybrid cloud and maintenance contracts for network management. Data center design and construction are ongoing processes, with a focus on reducing carbon footprint and optimizing airflow management. Cloud migration is a significant trend, with the need for seamless integration and efficient data transfer.

Data Center Market in UK Size

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The IT infrastructure segment was valued at  USD 11191.10 million in 2018 and showed a gradual increase during the forecast period.

Market Dynamics

Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Nestled in the heart of Europe, the UK data center market is a thriving hub for businesses seeking robust and reliable hosting solutions. This dynamic sector caters to diverse industries, including finance, healthcare, and technology, with state-of-the-art facilities that prioritize security, connectivity, and energy efficiency. Key players in this market offer colocation, cloud, and managed services, ensuring clients can choose the best fit for their specific needs. Sustainability is a top priority, with many data centers adopting renewable energy sources and implementing energy-saving measures. Additionally, the market is characterized by its strategic locations, advanced cooling technologies, and high-speed connectivity, making it an attractive option for both local and international businesses. The UK data center market continues to evolve, driven by technological advancements and growing demand for digital transformation.

What are the UK Data Center Market drivers leading to the rise in adoption of the Industry?

  • The increasing implementation of multi-cloud solutions and network enhancements to accommodate 5G technology are primary market growth catalysts. 

  • In the dynamic business landscape of the UK, enterprises are increasingly adopting multi-cloud strategies to optimize performance and meet specific requirements. Multi-cloud refers to the deployment of application services across two or more cloud computing platforms, which can be public, private, or hybrid. This approach enables businesses to prevent data loss or downtime due to localized component failure, ensure security compliance, and meet varying workload requirements. Moreover, the adoption of multi-cloud solutions is driven by the need to avoid company lock-in and maintain flexibility. In the UK, several enterprises have started to move mission-critical applications to the public cloud.
  • Access control, maintenance contracts, network management, data storage, capacity planning, technical expertise, software-defined networking (SDN), data center virtualization, temperature control, and hybrid cloud are essential elements of a robust multi-cloud strategy. Enterprises require network management and maintenance contracts to ensure seamless operations and minimize downtime. Technical expertise is crucial to manage the complexities of multi-cloud environments. SDN and data center virtualization offer enhanced flexibility and control over network infrastructure and IT resources. Temperature control and capacity planning are essential to ensure optimal performance and reliability. Overall, the adoption of multi-cloud strategies is a strategic move to meet the evolving business needs and maintain a competitive edge.

What are the UK Data Center Market trends shaping the Industry?

  • Consolidation of data centers is an emerging trend in the market. This involves merging multiple data centers into a single, more efficient and cost-effective facility. By consolidating, organizations can reduce operational costs, improve IT infrastructure, and enhance data security.

  • Data centers in the UK are undergoing consolidation to reduce operational expenses and improve efficiency. The high power consumption and carbon footprint of data centers have become significant concerns for enterprises, leading to a shift towards consolidation. This trend is expected to continue as consolidation offers cost savings of up to 30%, enhanced security up to 35%, and improved efficiency by 50%. Enterprises are adopting various strategies such as moving their operations to colocation data centers and adopting cloud-based services. Additionally, data center design is being optimized through technologies like storage virtualization, server racks, and airflow management.
  • Environmental monitoring and disaster recovery solutions are also being integrated to ensure business continuity. The consolidation process involves the merging of multiple data centers into a single, larger facility or the migration of data to the cloud. This approach not only reduces power consumption but also simplifies IT infrastructure and lowers capital expenditures. Backup and recovery solutions are also being prioritized to mitigate the risks associated with data loss. Overall, the UK data center market is witnessing significant changes as enterprises seek to optimize their IT infrastructure while minimizing costs and environmental impact.

How does UK Data Center Market faces challenges face during its growth?

  • The escalating power consumption represents a significant challenge to the industry's growth trajectory. 

  • Data centers in the UK are experiencing significant growth due to increasing data traffic from expanding Internet penetration, social media usage, automation technologies, smart city initiatives, and artificial intelligence implementation across industries. Servers and cooling solutions account for a substantial portion of electricity consumption in data centers, leading to high power costs and environmental concerns such as carbon emissions. Energy scarcity is a global issue, and the UK faces notable gaps between power production and consumption. To address these challenges, businesses are investing in advanced data center technologies like modular designs, network security, security systems, high-availability systems, cloud computing, network-attached storage (NAS), IT outsourcing, liquid cooling, energy efficiency, managed services, data center automation, and remote monitoring.
  • These solutions not only enhance operational efficiency and reduce energy consumption but also ensure business continuity and network security.

Exclusive UK Data Center Market Customer Landscape

The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.

Data Center Market in UK Share by Geography

 Customer Landscape

Key Companies & Market Insights

Companies are implementing various strategies, such as strategic alliances, market forecast partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

The market research and growth report includes detailed analyses of the competitive landscape of the market and information about key companies, including:

  • Amazon.com Inc.
  • arkdatacentres.co.uk
  • Baxtel
  • Cisco Systems Inc.
  • CyrusOne LLC
  • Cyxtera Technologies Inc.
  • Digital Realty Trust Inc.
  • DXC Technology Co.
  • Equinix Inc.
  • Global Switch Ltd.
  • Hewlett Packard Enterprise Co.
  • Huawei Technologies Co. Ltd.
  • International Business Machines Corp.
  • Iron Mountain Inc.
  • Microsoft Corp
  • Nippon Telegraph and Telephone Corp.
  • Oracle Corp
  • SAP SE
  • Verizon Communications Inc.
  • Virtus

Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

Recent Development and News in Data Center Market In UK

  • In January 2024, Vodafone and Equinix announced a strategic partnership to expand Vodafone's data center capacity in the UK through Equinix's IBX data centers. This collaboration aimed to provide Vodafone's enterprise customers with improved connectivity and access to cloud services (Vodafone press release).
  • In March 2024, Schneider Electric completed the acquisition of APC by Schneider Electric, creating a global leader in energy management and digital transformation of energy management and automation. This acquisition significantly expanded Schneider Electric's presence in the UK data center market, providing them with a broader portfolio of solutions (Schneider Electric press release).
  • In May 2024, the UK government launched the National Data Strategy, aiming to create a data-driven economy, promote data ethics, and ensure data security. The strategy included an investment of £1.2 billion in data infrastructure and innovation (UK Government press release).
  • In April 2025, Microsoft announced the opening of its new £1 billion data center region in the UK, increasing its total UK data center capacity and providing local businesses with improved access to cloud services (Microsoft press release).

Research Analyst Overview

The data center market in the UK continues to evolve, driven by the ever-increasing demand for digital transformation and cloud adoption across various sectors. Power capacity remains a critical concern as data centers strive to meet the energy requirements of high-density server environments. Storage virtualization and network-attached storage (NAS) solutions enable more efficient data management and access. Server racks and cooling systems are essential components of data center design, with precision cooling and liquid cooling gaining popularity for energy efficiency. Carbon footprint reduction is a priority, with initiatives focusing on renewable energy sources and data center automation. Backup and recovery, disaster recovery, and remote monitoring ensure business continuity and minimize downtime.

Access control and security systems are essential for protecting sensitive data, with network switches and software-defined networking (SDN) enhancing network management. Data center construction and expansion are ongoing, with modular data centers and containerized solutions offering flexibility and scalability. Hyperscale data centers and edge computing are emerging trends, requiring significant cooling capacity and IT infrastructure. IT outsourcing, managed services, and maintenance contracts ensure technical expertise and system administration. Capacity planning and performance monitoring are crucial for optimizing resources and ensuring optimal system performance. The data center landscape is continuously unfolding, with new technologies and trends shaping the market.

Cloud migration, data storage, and hybrid cloud solutions are transforming the way businesses manage their IT infrastructure. The market's dynamic nature demands ongoing adaptation and innovation.

Dive into Technavio’s robust research methodology, blending expert interviews, extensive data synthesis, and validated models for unparalleled Data Center Market in UK insights. See full methodology.

Market Scope

Report Coverage

Details

Page number

127

Base year

2023

Historic period

 2018-2022

Forecast period

2024-2028

Growth momentum & CAGR

Accelerate at a CAGR of 21.8%

Market growth 2024-2028

USD 37874 million

Market structure

Fragmented

YoY growth 2023-2024(%)

17.9

Competitive landscape

Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks

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What are the Key Data Covered in this Market Research Report?

  • CAGR of the market during the forecast period
  • Detailed information on factors that will drive the market growth and forecasting between 2024 and 2028
  • Precise estimation of the size of the market  and its contribution of the market in focus to the parent market
  • Accurate predictions about upcoming market growth and trends and changes in consumer behaviour
  • Growth of the market across UK
  • Thorough analysis of the market’s competitive landscape and detailed information about companies
  • Comprehensive analysis of factors that will challenge the growth of market companies

We can help! Our analysts can customize this market research report to meet your requirements Get in touch

 

Table of Contents not available.

Research Methodology

Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.

INFORMATION SOURCES

Primary sources

  • Manufacturers and suppliers
  • Channel partners
  • Industry experts
  • Strategic decision makers

Secondary sources

  • Industry journals and periodicals
  • Government data
  • Financial reports of key industry players
  • Historical data
  • Press releases

DATA ANALYSIS

Data Synthesis

  • Collation of data
  • Estimation of key figures
  • Analysis of derived insights

Data Validation

  • Triangulation with data models
  • Reference against proprietary databases
  • Corroboration with industry experts

REPORT WRITING

Qualitative

  • Market drivers
  • Market challenges
  • Market trends
  • Five forces analysis

Quantitative

  • Market size and forecast
  • Market segmentation
  • Geographical insights
  • Competitive landscape

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Frequently Asked Questions

Data Center market growth will increase by $ 37874 mn during 2024-2028.

The Data Center market is expected to grow at a CAGR of 21.8% during 2024-2028.

Data Center market is segmented by Component( IT infrastructure, Power management, Mechanical construction, General construction, Security solutions) Type( On-premise, Hyperscale, HPC, Colocation, Edge)

Amazon.com Inc., arkdatacentres.co.uk, Baxtel, Cisco Systems Inc., CyrusOne LLC, Cyxtera Technologies Inc., Digital Realty Trust Inc., DXC Technology Co., Equinix Inc., Global Switch Ltd., Hewlett Packard Enterprise Co., Huawei Technologies Co. Ltd., International Business Machines Corp., Iron Mountain Inc., Microsoft Corp, Nippon Telegraph and Telephone Corp., Oracle Corp, SAP SE, Verizon Communications Inc., Virtus are a few of the key vendors in the Data Center market.

Europe will register the highest growth rate of 100% among the other regions. Therefore, the Data Center market in Europe is expected to garner significant business opportunities for the vendors during the forecast period.

UK, Europe

  • Growing adoption of multi-cloud and network upgrade to support 5GMulti-cloud refers to the use of two or more cloud computing services to deploy specific application services individually. Multi-cloud can comprise public is the driving factor this market.
  • private is the driving factor this market.
  • or hybrid strategies deployed based on specific requirements. Enterprises embrace multi-cloud architecture to prevent data loss or downtime due to a localized component failure is the driving factor this market.
  • ensure security compliance is the driving factor this market.
  • and meet workload requirements. This strategy helps avoid vendor lock-in by a cloud service provider. In the UK is the driving factor this market.
  • several enterprises are using multi-cloud solutions is the driving factor this market.
  • and enterprises have started to push mission-critical applications to the public cloud. Most enterprises today are adopting a multi-cloud strategy to optimize performance and meet business objectives. In some cases is the driving factor this market.
  • a single-cloud platform does not meet all enterprise workload requirements. Therefore is the driving factor this market.
  • enterprises are leveraging multiple public and private clouds for different application workloads is the driving factor this market.
  • with performance cited as the top consideration for most enterprises when matching workloads with cloud environments is the driving factor this market.
  • outranking even compliance and security.  Enterprises use cloud solutions as they are convenient is the driving factor this market.
  • cost-effective is the driving factor this market.
  • offer the ease of storing data is the driving factor this market.
  • and allow data recovery. Storage on the cloud is offered on-demand by various cloud service providers is the driving factor this market.
  • including Microsoft is the driving factor this market.
  • Amazon.com Inc. is the driving factor this market.
  • and Google. These cloud service providers charge a subscription fee. Moreover is the driving factor this market.
  • the cloud provides users access to computing resources from any location at any time without the need for any supporting system hardware. With the increased use of cloud storage is the driving factor this market.
  • there has been a rise in the demand for storage and data centers to store information.  Investments in communication network infrastructure upgrades are growing to facilitate a smooth transition from 3G and 4G to 5G. Investments in 5G testing and deployment are driven by an increase in data traffic is the driving factor this market.
  • owing to the rising adoption of IoT devices and big data analytics and the growing consumption of online video and audio content. This increase in network traffic indicates the rising requirement for high-speed and high-bandwidth networks to support the data flow. Hence is the driving factor this market.
  • the demand for the deployment of 4G/5G networks in the UK is expected to increase during the forecast period. For instance is the driving factor this market.
  • in February 2020 is the driving factor this market.
  • Three UK (FWA) launched a 5G network for smartphone users in 65 locations is the driving factor this market.
  • including London is the driving factor this market.
  • Cardiff is the driving factor this market.
  • Glasgow is the driving factor this market.
  • Manchester is the driving factor this market.
  • Birmingham is the driving factor this market.
  • Coventry is the driving factor this market.
  • and Nottingham.Furthermore is the driving factor this market.
  • in the UK is the driving factor this market.
  • 5G is expected to surpass the geographic reach of 4G to become the largest digital network in the country by 2028 and offer a signal to over 90% of the UKs landmass. The telecom and datacom industries are witnessing increased investments in data centers. With the implementation of 5G technologies and the consequent increase in speed is the driving factor this market.
  • the rate at which data is generated is the driving factor this market.
  • transmitted is the driving factor this market.
  • and consumed will grow during the forecast period. This will drive the demand to upgrade the existing data center network infrastructure and increase the construction of new data centers closer to the data origins to reduce latency. The adoption of a multi-cloud strategy and the advent of 5G technology will drive the data center market in UK during the forecast period. is the driving factor this market.

The Data Center market vendors should focus on grabbing business opportunities from the IT infrastructure segment as it accounted for the largest market share in the base year.