Market Trends of Canada Data Center Construction Industry
Tier 3 Data Centers were Expected to Record Significant Market Share in 2023
- The Canadian data center construction market is on the rise, compelling service providers to adopt tier 3 standards. Consequently, the country has seen a surge in tier 3 colocation facilities. Currently, Canada hosts 35 operational tier 3 facilities, with several more in the pipeline.
- There has been a notable decline in demand for tier 1 and 2 data centers, lagging behind the rising demand for uninterrupted services. With the proliferation of global conglomerates, the spotlight is shifting to tier 3 and 4 data centers, which offer enhanced 24/7 business continuity services.
- By the end of 2023, tier 3 data centers were projected to claim over 70% of the market share, positioning them as dominant players. These centers are known for their robust redundancies in power and cooling, alongside a comprehensive suite of onsite services. Sectors like BFSI, telecommunications, and media, especially those emphasizing entertainment, are pivoting toward wholesale and hyperscale colocation facilities, fueling the demand for tier 3 centers. For instance, in early 2023, Canada boasted 33.1 million social media users, with a vast majority maintaining at least one active account. This translated to a social media penetration rate of 91.3% in the country, underscoring the pivotal role of social media in propelling Canada's data center growth.
- In March 2023, eStruxture Data Centers, a Canadian provider of cloud and carrier-neutral data centers, unveiled its second data center in Calgary, known as CAL-2, boasting a tier 3 classification. Spanning about 93,000 square feet and powered by 20 MW, CAL-2 stands as Calgary's most extensive data center, marking a significant stride in the nation's tier 3 data center landscape.
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The IT and Telecommunication Segment to Hold Significant Market Share
- Canada's information and communications technology (ICT) market stands out as one of the fastest-growing. As more enterprises and organizations shift their operations to cloud platforms, the industry is witnessing a notable surge in growth.
- Major cloud service providers like Microsoft, Oracle, Google, Amazon Web Services, and Tencent Cloud are establishing cloud regions in response to the country's rising adoption of cloud-based services.
- Moreover, in November 2023, Microsoft announced plans to invest USD 500 million in expanding its cloud computing and AI infrastructure in Quebec City. This investment aims to establish several new data centers by the end of 2025.
- The telecommunication industry is advancing, adopting a hybrid cloud model that merges public and private clouds. This hybrid approach equips telecom firms to navigate unexpected traffic spikes efficiently. By leveraging hybrid cloud services, the telecom industry in Canada can swiftly roll out cloud services, minimizing downtimes. Bandwidth speeds are on the rise, with mobile data consumption per user climbing from 4.8 GB in 2022 to a projected 8.6 GB by 2029.
