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

Europe Data Center Market Analysis

The Europe Data Center Market size is estimated at 13.58 thousand MW in 2025, and is expected to reach 21.07 thousand MW by 2030, growing at a CAGR of 9.18%. Further, the market is expected to generate colocation revenue of USD 18,108.3 Million in 2025 and is projected to reach USD 35,033.7 Million by 2030, growing at a CAGR of 14.11% during the forecast period (2025-2030).

The European data center landscape is experiencing a significant transformation driven by technological advancement and sustainability initiatives. The industry maintains impressive operational efficiency, with data centers achieving an average rack space utilization rate of 74% in 2022, demonstrating optimal resource management. The shift toward more sustainable operations is evidenced by the increasing adoption of renewable energy sources, including solar, wind, hydroelectricity, and marine energy, particularly in the FLAP-D markets. This transition is supported by government initiatives, as demonstrated by the French government's commitment of over USD 1 billion for renewable energy innovation projects aligned with their 2030 national investment plan.

The data center market is witnessing a geographical redistribution of data center investments, primarily driven by land availability and cost considerations. Traditional hubs like London, where land prices reach approximately USD 150 per square foot, are facing competition from more cost-effective locations like Amsterdam, where land costs are significantly lower at USD 38 per square foot. This price disparity is reshaping investment patterns and leading to the emergence of new data center clusters across Europe. The industry's infrastructure is evolving to meet modern computing demands, with over 70% of all traffic now moving directly between servers, necessitating advanced internal networking capabilities and higher speeds.

A notable trend is the rise of secondary markets outside the traditional FLAP-D (Frankfurt, London/Slough, Amsterdam, Paris, Dublin) region. Cities like Barcelona, Milan, and Rome are emerging as significant data center locations, with projections indicating a tripling of their data center power capacity over the next four years. This expansion is accompanied by technological advancements in facility design, with tier 3 data centers maintaining impressive uptime rates of 99.982%, translating to just 1.6 hours of downtime annually. The industry currently operates over 1,159 colocation data center facilities across Europe, forming a robust infrastructure network.

The data center market is experiencing significant regulatory and operational transformations, particularly in major hubs. The Greater London Authority's recent initiative to modify data center development application processes aims to address power management challenges in West London, demonstrating the industry's adaptation to infrastructure constraints. This evolution is complemented by the emergence of specialized facilities in new locations, with significant development activities in Madrid and Barcelona, where multiple third-party DC projects are under construction. The industry is also seeing increased adoption of district heating concepts, particularly in Nordic countries like Sweden, where data centers are being integrated into local energy systems, marking a shift toward more sustainable and community-oriented operations.

Europe Data Center Market Trends

Increasing usage of OTT subscriptions and mobile gaming along with social media penetration increases the data center market

• By 2025, smartphones are expected to account for nearly 85% of connections in Europe. Western Europe is home to some of the world’s biggest consumers of mobile data, while Central and Eastern Europe lag behind the global average. In 2021, in Western European, the traffic from mobile devices reached 4,189,615 terabytes per month. The growing average data volume due to rising OTT subscriptions for smartphones and mobile gaming is further driving the demand for data processing and storage facilities for live-streaming games and video content. The Danish market saw an 11.8% growth in total consumer spending on video in 2021 compared to 2020. The Danish video market represented a value of more than DKK 4,591 million (EUR 607.8 million) in 2021.
• The ongoing trend of OTT services is increasing data traffic per smartphone in European countries. For instance, in Denmark, OTT subscriptions reached 2.1 million in 2016 to 5.7 million in 2021. The number of social media users in Switzerland was 7.54 million, increasing by 440,000 between 2021 and 2022, indicating a 6.2% growth. Factors such as increased data consumption, time spent on smartphones, and growth of digitalization across all end users are leading to the rise in data traffic per smartphone.
• A major increase in data consumption was observed in 2021 after the COVID-19 pandemic, with more users switching to smartphones due to the remote working culture in the region. The data exchanged through the internet exchange operator, DE-CIX, reported an increase in data throughput from 32 exabytes in 2020 to more than 38 exabytes in 2021. Such statistics suggest the significant growth of data traffic per smartphone in the region.

Increasing spending by European users on the App Store and Google Play along with cashless transactions increases the Data Center demand

• In 2021, mobile technologies and services generated around 4.6% of the GDP in Europe, a contribution that amounted to more than EUR 745 billion of the economic value. The average lifespan of a smartphone in Europe is three years, with annual sales of almost 211 million units.
• In Europe, 474 million individuals were subscribers to mobile services in 2021. By 2025, this number is projected to increase to 480 million. Over two-thirds of regional operators have built 5G networks, and most European nations have implemented commercial 5G services. There may be 311 million 5G connections in Europe by 2025, representing a 44% adoption rate. The year 2021 witnessed USD 18.3 billion in spending by European users on the App Store and Google Play. Based on customer spending for in-app purchases, subscriptions, and premium apps, this prediction represented a 22.8% rise in yearly gross income from 2020. European spending accounted for approximately 14% of global mobile app revenue in 2021, which reached USD 131.6 billion.
• The internet penetration in Switzerland increased from 89% in 2016 to 96% in 2021, while at the same time, the number of smartphone users increased from 6.9 million in 2016 to 7.9 million in 2021. Owing to such extensive use, digital payment services were promoted, and their application increased due to the COVID-19 pandemic. More people in Switzerland are using cashless transactions. Only 35% of Swiss citizens still prefer cash as a form of payment, indicating that people are increasingly choosing cashless transactions, while the rest favor using a card or an app to pay. Such factors indicate the rising use of smartphones in the European market, resulting in a constant increase in data and necessitating a growing amount of storage space.

OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT

Segment Analysis: Data Center Size

Massive Segment in Europe Data Center Market

The massive data center segment dominates the European market with approximately 32% market share in 2024, representing an IT load capacity of around 3,875 MW. This significant market position is driven by the growing trend toward adopting green energy solutions, as the European Union has set ambitious targets to achieve a 32% share of renewable energy in energy consumption by 2030. The massive segment's prominence is particularly evident in key markets like the United Kingdom, Germany, and the Netherlands, where major providers such as Digital Realty Trust Inc., Equinix Inc., and CyrusOne Inc. operate multiple facilities. These providers maintain substantial rack capacities, with Digital Realty Trust Inc. operating 132,489 racks and Equinix Inc. managing 93,988 racks across their massive data center facilities.

Mega Segment in Europe Data Center Market

The mega data center segment is experiencing the most rapid growth in the European market, with a projected growth rate of approximately 15% during 2024-2029. This exceptional growth is primarily driven by the increasing shift towards mega facilities, particularly in developed regions. The segment's expansion is supported by government initiatives promoting digitalization and investment in network connectivity across major European markets. The growth is particularly notable in countries like Turkey, Portugal, Bulgaria, and other developing regions where the demand for mega data centers is rising due to increasing digital transformation initiatives and the adoption of cloud services. The segment's growth is further bolstered by significant investments in renewable energy infrastructure and the implementation of advanced cooling technologies.

Remaining Segments in Data Center Size Market

The large, medium, and small data center segments each serve distinct market needs in the European data center landscape. The large segment maintains a significant presence, particularly in established markets like the United Kingdom, France, and Germany, catering to enterprise-level requirements. The medium segment primarily serves regional and mid-sized business needs, with a strong presence in countries like France, Switzerland, Russia, and Spain. The small segment, while representing a smaller market share, plays a crucial role in serving local markets and smaller enterprises, particularly in developing regions of Europe. These segments collectively provide a diverse range of solutions that cater to varying business requirements, from local operations to regional expansions.

Segment Analysis: Tier Type

Tier 3 Segment in Europe Data Center Market

The Tier 3 segment dominates the European data center market, accounting for approximately 74% market share in 2024. This significant market position is driven by the segment's comprehensive redundancy capabilities and high availability, with facilities designed to have no more than 1.6 hours of unplanned downtime annually. The United Kingdom leads in hosting Tier 3 data centers, particularly concentrated in Slough and Greater London, followed by strategic locations across France, Germany, and Ireland. Major providers including Digital Realty Trust Inc., Virtus Data Center, and Equinix Inc. have established strong footprints in this segment. The preference for Tier 3 facilities is particularly pronounced among SMEs, which constitute 99.9% of the UK business population, as these facilities offer superior redundancy protections at a more cost-effective price point compared to Tier 4 facilities.

Tier 4 Segment in Europe Data Center Market

The Tier 4 segment is experiencing the most rapid growth in the European data center market, with a projected growth rate of approximately 16% from 2024 to 2029. This accelerated growth is primarily driven by increasing adoption in hyperscale colocation by major cloud and telecom industry end users. The segment's expansion is particularly notable in countries like Austria, Germany, Spain, and Sweden, where new construction of Tier 4 certified facilities is underway. These facilities offer the highest level of redundancy and fault tolerance, with an impressive 99.995% uptime per year, translating to less than 0.5 hours of downtime annually. The growth trajectory is further supported by the increasing demand for computing and cloud solutions across the region, with providers focusing on Tier 4 facility construction to meet the stringent requirements of enterprise-level clients.

Remaining Segments in Tier Type

The Tier 1 & 2 segment represents the basic level of data center infrastructure in the European market. These tiers primarily serve small and medium enterprises with minimal IT load requirements and cost-sensitive operations. While the segment shows limited growth potential compared to higher tiers, it continues to maintain its presence in countries like Spain and Denmark, particularly catering to SMEs with basic infrastructure needs. The relatively lower redundancy levels and higher potential downtime in these tiers make them suitable for non-critical applications and businesses with flexible uptime requirements, though the market is increasingly shifting towards higher tier certifications for more reliable operations.

Segment Analysis: Absorption

Utilized Segment in Europe Data Center Market

The utilized segment dominates the European data center market, accounting for approximately 76% of the total IT load capacity in 2024. This segment's prominence is driven by the increasing adoption of 5G connectivity across various developed countries, leading to higher occupancy rates. The uptake of 5G in Europe currently represents only about 3% of total mobile connections but is expected to reach more than 10% by 2028, contributing to a significant data chunk and further increasing rack utilization of facilities. The segment is projected to maintain strong growth at nearly 11% through 2029, supported by the growing renewable energy adoption in various countries. Sweden's emergence as an area of interest with its 'Node Pole' data center near the North Pole, utilizing free cooling technology and hydroelectric power for both efficiency and green credentials, exemplifies this trend. Additionally, Iceland is becoming a prominent hub for data centers, particularly due to the 15-year visibility into energy pricing provided by the National Power Company, further strengthening the utilized segment's market position.

Non-Utilized Segment in Europe Data Center Market

The non-utilized segment represents the remaining portion of the European data center market, primarily consisting of vacant or reserve capacity maintained by operators for future expansion and redundancy purposes. This segment plays a crucial role in ensuring operational flexibility and scalability for data center providers. Private equity funds are actively promoting new data center projects across previously underserved markets, including Poland, Spain, Portugal, and Italy, where cloud and hyperscale investments are still at an early stage. The strategic importance of maintaining non-utilized capacity is particularly evident in emerging markets where first-mover advantages can be significant. This approach allows operators to quickly respond to sudden increases in demand while maintaining optimal operational efficiency. The segment also serves as a buffer against potential market fluctuations and helps maintain service quality during peak usage periods.

Europe Data Center Market Geography Segment Analysis

Data Center Market in the United Kingdom

The United Kingdom maintains its position as Europe's premier data center market, commanding approximately 18% of the region's total IT load capacity. The country's digital economy accounts for more than 7% of its GDP, driven by the widespread adoption of enterprise cloud services, Software-as-a-Service utilities, and the growing demands of e-commerce platforms. The UK's robust internet infrastructure, with approximately 67 million internet users and 53 million active social media users, accounting for over 84% of the total population, provides a strong foundation for data center operations. The market is particularly concentrated in strategic locations like Slough and Greater London, which host the majority of Tier 3 certified facilities. Despite Brexit-related challenges, the UK government's commitment to digital infrastructure development, including its target for nationwide gigabit broadband availability by 2030, continues to attract significant investments in the sector. However, power supply availability and sustainability remain critical challenges for data center providers across the United Kingdom, with operators citing these as the primary factors influencing new facility locations. The UK data center market is thus poised for continued growth.

Data Center Market in Ireland

Ireland's data center market is experiencing explosive growth, projected to expand at approximately 16% annually from 2024 to 2029, positioning it as Europe's fastest-growing data center market. The country's strong position in terms of the digital economy is reflected in its Digital Economy and Society Index (DESI) score, which has shown an average yearly growth of 8.5%, one of the highest in the European Union. The market benefits from significant tax incentives, including a 12.5% headline corporation tax rate, one of the lowest in the sector. Dublin's emergence as a major data center hub is particularly noteworthy, with the city welcoming 135 new financial companies in recent years. The implementation of renewable solutions has become a crucial factor in new data center developments, as these facilities currently account for 14% of Ireland's electricity usage. The market's growth is further supported by the government's EUR 2.7 billion investment commitment through the National Broadband Plan, which aims to enhance gigabit and 5G connectivity across the country. By 2029, 5G technology is expected to contribute significantly to Dublin's economy, with projections indicating a potential increase from EUR 30 million to EUR 1.12 billion.

Data Center Market in Germany

Germany's data center market continues to demonstrate robust growth, particularly driven by its strong digital infrastructure and strategic location in central Europe. The country's population of 83.9 million, including 67.14 million smartphone users and 72.6 million social media users, creates substantial demand for data processing and storage facilities. The government's commitment to digital transformation is evident through initiatives such as the Smart City Model Projects Program, with EUR 1.25 billion in funding allocated for nationwide smart city development. Frankfurt stands out as a major data center hub, attracting significant investments due to its strategic importance as a financial center and its excellent connectivity infrastructure. The market's evolution is further supported by the country's focus on sustainability, with operators increasingly adopting green energy solutions to align with the European Union's renewable energy targets. The German government's support for digitalization extends to various sectors, particularly benefiting small and medium-sized enterprises, which comprise 99% of all businesses in the country. Among the largest data centers in Europe, Germany's facilities continue to set benchmarks for innovation and efficiency.

Data Center Market in the Netherlands

The Netherlands maintains its position as a crucial European data center market, with Amsterdam serving as its primary hub and one of the most significant colocation ecosystems globally. The city's technological infrastructure, supported by premier internet exchange capabilities and transatlantic fiber optic links, continues to attract businesses ranging from startups to global leaders in AI, fintech, and medtech. More than 80% of all businesses in the Netherlands utilize cloud computing, with market newcomers like Google, Oracle, and Microsoft maintaining a strong presence. The Dutch government's commitment to digital infrastructure is evident through various initiatives aimed at improving connectivity and sustainability. Beyond Amsterdam, other regions including Aalsmeer, Almere, Alphen aan den Rijn, Apeldoorn, Arnhem, and Deventer are emerging as alternative data center locations, offering opportunities for market expansion while addressing the space constraints and power availability challenges faced in the Amsterdam metropolitan area. The presence of major data center companies in Europe in the Netherlands underscores its strategic importance in the region.

Data Center Market in Other Countries

The European data center landscape extends beyond the major markets to include several emerging and established locations across the continent. France has positioned itself as a significant player with its strategic locations in Paris and Marseille, while Spain is gaining prominence with Madrid and Barcelona emerging as key data center hubs. The Nordic countries, including Norway, Sweden, and Denmark, are attracting increased attention due to their favorable climate conditions and renewable energy availability. Switzerland's market benefits from its political stability and advanced infrastructure, while emerging markets in Eastern Europe, including Poland and the Czech Republic, are experiencing growing interest from international operators. The Italian market is developing rapidly, particularly around Milan, while Belgium leverages its strategic position between major European markets. These diverse locations offer unique advantages in terms of connectivity, power availability, and regulatory frameworks, contributing to the overall robustness of Europe's data center ecosystem. As European data center providers expand their reach, these regions are becoming integral to the continent's digital infrastructure.

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We provide a complimentary and exhaustive set of data points on the country and regional level metrics that present the fundamental structure of the industry. Presented in the form of 50+ free charts, the sections cover difficult to find data on various countries on smartphone users, data traffic per smartphone, mobile and broadband data speed, fiber connectivity network, and submarine cables.