Africa Data Center Market SIZE & SHARE ANALYSIS - GROWTH TRENDS & FORECASTS UP TO 2030

Africa Data Center Market Analysis

The Africa Data Center Market size is estimated at 0.78 thousand MW in 2025, and is expected to reach 1.43 thousand MW by 2030, growing at a CAGR of 12.86%. Further, the market is expected to generate colocation revenue of USD 750.2 Million in 2025 and is projected to reach USD 1,709.6 Million by 2030, growing at a CAGR of 17.91% during the forecast period (2025-2030).

The African data center landscape is experiencing rapid transformation driven by widespread digital adoption across industries. The region has established itself as a growing technology hub, with over 400 technology centers spread across 93 cities in 42 countries as of 2023. This technological ecosystem is supported by robust startup funding, with African startups raising approximately USD 4.8 billion through 1,000 deals in 2022, showcasing a significant increase from USD 4.33 billion raised across 820 rounds in 2021. The increasing adoption of artificial intelligence, IoT, and blockchain technology across various sectors has created substantial demand for data processing and storage capabilities.

The market is witnessing a significant shift toward higher-tier data center facilities to ensure reliable and efficient operations. Industry stakeholders are increasingly focusing on constructing Tier 3 and Tier 4 certified facilities, moving away from Tier 1 and 2 facilities due to power availability concerns and growing demand for advanced capabilities. This transition is reflected in the varying growth rates across tiers, with Tier 4 facilities projected to grow at an 18.02% CAGR, compared to Tier 3 at 14.40% and Tier 1 and 2 at 3.26%. These advanced facilities offer superior features including enhanced bandwidth speeds, lower latency, improved connectivity, and robust disaster recovery options.

Smart city initiatives across the continent are creating new opportunities for data center development. Cities like Cape Town have gained international recognition for their implementation of IoT and real-time data analysis through sensor networks. Similarly, Kigali, Rwanda, has deployed sophisticated sensor systems for monitoring air quality, power grid safety, and water infrastructure management. These smart city developments generate substantial amounts of data, necessitating advanced storage and processing capabilities while driving innovation in data center design and operations.

The industry is experiencing significant investment in infrastructure modernization and expansion projects. Major operators are actively developing mega and massive data center facilities to meet growing demand. These developments are accompanied by a focus on sustainability and energy efficiency, with many new facilities incorporating green design principles and renewable energy sources. The market is also seeing increased interest from international players, leading to technology transfer and adoption of global best practices in data center operations and management. This trend is particularly evident in the development of carrier-neutral facilities that offer enhanced connectivity options and flexible colocation services to meet diverse client needs.

Africa Data Center Market Trends

Online markets such as Jumia, Takealot, Kilimall, and others to boost Data centers in Africa

• Africa's data consumption increased from 0.6 GB/month in 2016 to 2.25 GB/month in 2022. It is expected to reach around 11.3 GB/month by 2029. A growing number of smartphone users using digital services such as streaming and digital payments are expected to boost data consumption in the future.
• As telecom companies plan to shut down their 2G and 3G services and strengthen their existing 4G services, bandwidth speeds may increase by around 52.5 Mbps by 2029. The implementation of 5G services in 43 African countries may lead to increased bandwidth speeds, which may also increase data consumption. The use of popular streaming services such as Netflix, Disney+, and Amazon Prime is expected to grow among the youth.
• The number of online shoppers in Africa increased from 138.9 million in 2016 to 387.8 million in 2022, which may reach around 519.8 million by 2025. Jumia, Takealot, Kilimall, and Konga are a few leading online marketplaces in the region. The growing user base for these digital services has resulted in increased data consumption. To provide seamless services to customers, companies may have to increase the number of racks from 64,735 in 2022 to 188,643 by 2029, with a CAGR of 15.4%, which may also increase the IT load capacity from 518.7 MW in 2022 to 1,226.2 MW by 2029.

Increase use of digital wallets (M-Pesa) and use of OTT platforms, would increase data exchange leading to increase in data centers in the region.

• The availability of affordable Chinese smartphones, the removal of the general sales tax of 16% in countries such as Kenya, and the growing use of digitalization services by African youth for learning and other activities are boosting the number of smartphones in the region.
• In 2019, the total share of smartphone connections accounted for 44%, and with the growing adoption of technology, this share is expected to reach 75% by 2025. South Africa, Nigeria, and Egypt account for around 89 million, 163 million, and 75.6 million smartphone connections in the region, respectively. Around 60% of the users in Nigeria and 21% in South Africa use digital wallets such as M-Pesa for conducting transactions. Netflix, Disney+, and Amazon Prime are the leading OTT players in the region, with Netflix leading the African market with a subscriber base of around 6.4 million in 2022. The deployment of 5G services has been slow in Africa. These services have been launched in a few countries, such as Nigeria, South Africa, Botswana, Kenya, Mauritius, Madagascar, Seychelles, Tanzania, Togo, Zimbabwe, and Zambia.
• The African continent comprises around 54 countries, of which only 11 could implement 5G services. Hence, Africa is expected to have only 10% of 5G users by 2027. Telecom companies like Vodafone are focusing on strengthening their 4G services and plan to shut down their 2G and 3G services by 2026. To offer better services to users, companies may have to increase the number of racks, which may, in turn, increase the IT load capacity over the years.

OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT

Segment Analysis: Data Center Size

Massive Segment in Africa Data Center Market

The massive segment dominates the Africa data center market, commanding approximately 43% market share in 2024. This significant market position is driven by the increased trend of online shopping, digital payments, and gaming on smartphones across the region. The segment's prominence is further strengthened by large enterprises preferring data centers with high bandwidth, low latency, disaster recovery capabilities, and remote assistance features. Currently, Africa has around seven massive data center facilities, primarily concentrated in South Africa and Nigeria, with South Africa leading the segment at around 77% regional share. Major players like Vantage Data Centers, Cologix, and eStruxture have established their presence in this segment, offering comprehensive solutions to meet the growing demand for massive data center infrastructure.

Mega Segment in Africa Data Center Market

The mega segment is projected to experience exceptional growth during 2024-2029, driven by increasing smartphone adoption, digitalization in manufacturing, online gaming trends, and smart city services across Africa. Smart city projects across major cities like Nairobi and Cape Town are expected to generate significant data for processing, thus increasing the demand for mega-sized data centers in the region. The segment's growth is further supported by bigger players like Vantage Data Centers making significant contributions during the forecast period. The rising demand for digital applications, allowing users to leverage smart devices and applications for streaming, gaming, browsing, and other uses, is expected to fuel the expansion of mega data centers across the continent.

Remaining Segments in Data Center Size Market

The large, medium, and small segments complete the African data center market landscape, each serving distinct market needs. The large segment caters to SMEs expanding into larger enterprises seeking wholesale colocation services, while medium data centers provide solutions for growing businesses requiring close proximity and affordable options. The small segment primarily serves organizations needing minimal processing capabilities and cost-effective solutions. These segments collectively contribute to the market's diversity, offering various options for different business scales and requirements, though their growth rates remain moderate compared to the mega and massive segments.

Segment Analysis: Tier Type

Tier 3 Segment in Africa Data Center Market

Tier 3 data centers dominate the African data center market, accounting for approximately 73% of the total IT load capacity in 2024. This significant market share is driven by the growing adoption of artificial intelligence, big data analytics, and other advanced technologies across the continent. South Africa leads the Tier 3 data center market with around 56% share, followed by Nigeria at 30% and Egypt at 15%. The segment is characterized by massive data centers holding the largest share at about 48%, followed by large facilities at 37%, medium facilities at 13%, and small facilities at 2%. Major players like Teraco Data Environments (Digital Realty) maintain a strong presence in this segment, commanding approximately 45% of the region's Tier 3 data center market, while other significant contributors include Open Access and Telecom Egypt.

Tier 4 Segment in Africa Data Center Market

The Tier 4 data center segment is experiencing rapid growth in Africa, projected to expand at approximately 18% during 2024-2029. This growth is primarily driven by the increasing demand for high-reliability data center facilities that can support critical applications and provide advanced disaster recovery capabilities. The segment's expansion is supported by the deployment of 5G services, the evolution of telecom technology, and the growing number of smart city projects across Africa. Currently, there are 11 Tier 4 certified data centers operating across South Africa, Egypt, Ghana, Uganda, and Tunisia, with prominent global service providers like Vantage Data Centers, Equinix Inc., and Africa Data Centers announcing plans for new Tier 4 certified facilities during the forecast period.

Remaining Segments in Tier Type

The Tier 1 & 2 segment represents the basic level of data center infrastructure in Africa, primarily serving small and medium enterprises (SMEs) that require affordable data center solutions for minimal digitalization tasks such as file storage or operations that can tolerate lower speeds and higher latency. These facilities are mainly concentrated in South Africa, with Xneelo (Pty) Ltd being the primary operator. However, the segment's significance is diminishing as companies increasingly prefer higher tier facilities for better reliability and long-term sustainability, leading to a shift towards more advanced tier classifications that offer improved infrastructure and operational capabilities.

Segment Analysis: Absorption

Utilized Segment in Africa Data Center Market

The utilized segment dominates the Africa data center market, accounting for approximately 64% of the total IT load capacity in 2024. This segment encompasses various colocation types including hyperscale, retail, and wholesale facilities, as well as diverse end-user industries such as BFSI, cloud, e-commerce, government, manufacturing, media & entertainment, and telecom sectors. The segment's prominence is driven by the increasing adoption of cloud platforms, growing digitalization across industries, and the rising demand for data processing and storage capabilities in Africa. The segment is also experiencing the fastest growth trajectory, expected to maintain robust expansion through 2024-2029, particularly driven by hyperscale facilities which are anticipated to grow at nearly 25% during this period. This growth is supported by factors such as the increasing deployment of IoT platforms, rising adoption of artificial intelligence and big data analytics, and the expanding digital transformation initiatives across African enterprises.

Non-Utilized Segment in Africa Data Center Market

The non-utilized segment represents the available capacity in African data centers that remains unoccupied but ready for future deployment. This segment plays a crucial role in the market by providing the necessary buffer capacity to accommodate sudden spikes in demand and future growth requirements. The segment's importance is highlighted by the growing number of international cloud service providers and content delivery networks looking to establish their presence in Africa. Data center operators maintain this unused capacity to ensure they can quickly respond to market demands, support rapid deployment requirements from clients, and maintain operational flexibility. The strategic significance of this segment is further emphasized by the increasing focus on data sovereignty, which is driving more organizations to seek local data storage solutions, thereby necessitating readily available data center capacity across different African regions.

Africa Data Center Market Geography Segment Analysis

Africa Data Center Market in South Africa

South Africa dominates the African data center market, commanding approximately 63% of the total market capacity in 2024. The country's market leadership is driven by its advanced digital infrastructure and the strategic location of data centers in Africa, particularly in key cities like Johannesburg, Cape Town, and Durban. The establishment of Special Economic Zones (SEZs) and Free Trade Zones (FTZs) has created a conducive environment for data center investments. The country's high urban population concentration and robust e-commerce sector have fueled the demand for colocation services in South Africa. South Africa's position as a regional tech hub is further strengthened by its advanced IT infrastructure and the increasing migration from on-premise to colocation and managed services. The presence of major global data center operators and the continuous expansion of existing facilities have reinforced the country's position as the premier data center destination in Africa.

Africa Data Center Market in Nigeria

Nigeria is emerging as the fastest-growing data center market in Africa, with a projected growth rate of approximately 23% from 2024 to 2029. The country's rapid digital transformation is supported by its unique portfolio of ongoing digitalization processes and technological implementations. Nigeria's position as one of the prominent West African countries for network upgrades has attracted significant investments in data center infrastructure. The growing internet and e-commerce adoption in finance and other industries are driving the demand for colocation services. The urban population growth and increasing number of tech startups are creating substantial demand for server hosting and reliable colocation services. The country's strategic location and improving connectivity infrastructure make it an attractive destination for data center investments. Nigeria's commitment to digital transformation and the rising adoption of cloud services are expected to sustain this growth momentum.

Africa Data Center Market in Egypt

Egypt has established itself as a crucial data center hub in North Africa, leveraging its strategic position as a gateway between Europe, Asia, and Africa. The country's digital infrastructure development is supported by comprehensive government initiatives driving digital transformation across various sectors. The presence of multiple submarine cable landing stations has enhanced Egypt's connectivity capabilities, making it an attractive location for data center operations. The country's growing startup ecosystem and increasing adoption of digital services have created a strong demand for data center services. Egypt's focus on developing smart cities and implementing advanced technologies has further accelerated the growth of its data center market. The government's supportive policies and investments in digital infrastructure have created a favorable environment for data center operators, attracting both regional and international players to establish their presence in the country.

Africa Data Center Market in Kenya

Kenya has emerged as a significant player in East Africa's data center market, driven by its position as a regional technology hub. The country's robust telecommunications infrastructure and growing digital economy have created substantial demand for data center services. Kenya's strategic location and improving connectivity infrastructure have made it an attractive destination for data center investments. The country's thriving fintech sector and growing adoption of cloud services have fueled the demand for reliable data center facilities. Kenya's commitment to digital transformation and the implementation of supportive policies have encouraged both local and international operators to expand their presence. The growing emphasis on data sovereignty and the increasing adoption of digital services across various sectors continue to drive the growth of Kenya's data center market. The country's developing startup ecosystem and increasing internet penetration have created new opportunities for data center operators.

Africa Data Center Market in Other Countries

Beyond the major markets, several African countries are emerging as promising destinations for data center investments. Countries like Ghana, Ethiopia, Morocco, Uganda, Chad, Senegal, Namibia, Tunisia, and Zambia are witnessing growing demand for data center services. These markets are characterized by increasing digital transformation initiatives, improving connectivity infrastructure, and supportive government policies. The rising adoption of cloud services and digital payments across these countries is creating new opportunities for data center operators. Government initiatives focused on digital transformation and improving internet accessibility are laying the foundation for future growth. The increasing focus on data sovereignty and the need for local data storage solutions are driving investments in these markets. These countries are also benefiting from various regional integration initiatives and improving cross-border connectivity, which are essential for the development of their data center markets.

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