Malaysia Data Center Market Size and Share
Malaysia Data Center Market Analysis by Mordor Intelligence
The Malaysia data center market size is projected to expand from USD 6.55 billion in 2026 and USD 7.83 billion in 2027 to USD 19.32 billion by 2032, registering a CAGR of 19.8% between 2027 and 2032.
Malaysia’s local cloud capacity and digital payment activity support demand for facilities serving regulated data and continuous transaction workloads. International connectivity strengthens that proposition, while tax incentives make energy- and water-efficient design relevant to investment economics. Operators can respond by combining colocation capacity with renewable procurement and water-treatment arrangements, bringing resource execution into the customer proposition. Electricity-cost variability and approval sequencing can slow the delivery of committed capacity, so suppliers able to secure power and permits early are better placed to earn recurring hosting revenue.
Key Report Takeaways
- By data center size, large facilities led with a 23.62% Malaysia data center market share in 2026, while medium facilities are forecast to grow fastest at a CAGR of 30.5% between 2027 and 2032.
- Within the tier classification, Tier 3 held an 81.26% share of the Malaysia data center market size in 2026 and is also projected to grow fastest at a CAGR of 34.4% between 2027 and 2032.
- Among data center types, colocation led with a 95.23% share in 2026, whereas hyperscale/self-built facilities are forecast to grow fastest at a CAGR of 30.7% between 2027 and 2032.
- End-user demand was led by IT and ITES with a 31.34% share in 2026, with BFSI projected to grow fastest at a CAGR of 29.7% between 2027 and 2032.
- By hotspot, Johor Bahru represented a 53.19% share in 2026, and Cyberjaya is forecast to grow fastest at a CAGR of 29.9% between 2027 and 2032.
- Geographically, Johor Bahru led with a 53.19% share in 2026, while Cyberjaya is projected to grow fastest at a CAGR of 29.9% between 2027 and 2032.
Note: Market numbers in this report are based on Mordor Intelligence's proprietary estimation framework, which combines nine months of actuals with Q4 projections for base year 2026.
Market Trends and Insights
Drivers Impact Analysis of Malaysia Data Center Market*
| Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Rising hyperscale cloud deployments | +8.2% | Greater Kuala Lumpur | Medium term (2-4 years) |
| Surge in FinTech and e-commerce digitalization | +5.8% | Nationwide | Short term (≤ 2 years) |
| Rapid submarine cable landings boosting connectivity | +4.3% | Morib, Selangor and Sedili, Johor | Medium term (2-4 years) |
| Government tax incentives for green ICT investments | +3.4% | Nationwide | Short term (≤ 2 years) |
| Penang-Johor industrial corridor edge demand | +2.4% | Penang and Johor industrial clusters | Long term (≥ 4 years) |
| AI training clusters driving campuses | +2.2% | Kulai in Johor | Medium term (2-4 years) |
| Source: Mordor Intelligence | |||
Rising hyperscale cloud deployments
Locally available cloud regions can remove a service-location obstacle for regulated workloads. Microsoft made Malaysia West, its first cloud region in the country, generally available on May 28, 2025.[1] The AI-ready hyperscale infrastructure in Greater Kuala Lumpur comprises 3 availability zones. In August 2025, Maybank agreed to use Azure for some strategic systems, functions, and data workloads under a partnership covering ASEAN and beyond. Malaysia West’s in-country data residency was identified as key to Malaysian financial-services regulatory and sovereignty requirements. Infrastructure providers can therefore connect regional capacity with data-residency capabilities that make a local cloud service usable for financial customers.
Surge in FinTech and e-commerce digitalization
Transaction processing gives digitalization a route into hosting demand across financial services and commerce-enabled businesses. DuitNow QR transactions by individuals and merchants through banks and non-bank financial institutions doubled from 1.5 billion in 2024 to 3 billion in 2025. Income of Malaysian establishments with e-commerce transactions rose 2.8% year over year in the first quarter of 2026. Payment volume points to processing activity, while establishment income indicates the commercial scale of businesses transacting electronically. The sharper opportunity is payment-processing capacity for banks and non-bank institutions handling higher transaction counts, where computing demand follows processing volume rather than the monetary value of establishment income.
Rapid submarine cable landings boosting connectivity
International connectivity strengthens the commercial case for hosting workloads in Malaysia when landing infrastructure supports several network providers. In September 2025, TM Global completed its open cable landing station at Morib, Selangor, capable of supporting up to 3 submarine cable systems. An open interconnection facility gives connectivity providers a shared point for exchanging traffic, broadening the network options around domestic hosting. TM Global also reported the Asia Link Cable landfall at Sedili in Johor, with service planned for 2027. That distinction makes completed landing infrastructure and usable cable service separate milestones for capacity decisions. A hosting proposal dependent on the new cable must therefore align its customer service commitment with that later network milestone.
Government tax incentives for green ICT investments
Tax eligibility gives efficient data center design a commercial role beyond reducing resource consumption. Malaysia’s Digital Ecosystem Acceleration (DESAC) scheme offers tax incentives to qualifying operators adopting energy- and water-efficiency equipment and renewable energy. The Malaysian Investment Development Authority (MIDA) accepts applications through December 31, 2027, assessing local economic linkages and compliance with sustainability standards. For a developer, that conditional structure connects equipment choices with the investment case rather than treating sustainability as a later addition. It also makes qualifying design and the application timetable relevant before a project commits to its technical configuration. The resulting demand opportunity favors equipment and project proposals that meet the scheme’s conditions together, rather than efficiency claims detached from an eligible investment.
Restraints Impact Analysis of Malaysia Data Center Market*
| Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| High electricity tariff volatility | -2.7% | Peninsular Malaysia data center clusters | Short term (≤ 2 years) |
| Lengthy Tier 3/Tier 4 approval cycles | -1.9% | Nationwide | Medium term (2-4 years) |
| Scarcity of low-carbon power PPAs in Malaysia | -1.2% | Peninsular Malaysia data center clusters | Long term (≥ 4 years) |
| Shortage of accredited Uptime-qualified engineers | -0.7% | Nationwide | Medium term (2-4 years) |
| Source: Mordor Intelligence | |||
High electricity tariff volatility
Electricity price variability complicates the revenue needed to justify additional hosting capacity when generation costs can change each month. In Peninsular Malaysia, Automatic Fuel Adjustment changes generation charges monthly to reflect fuel prices and other generation costs. Tenaga Nasional Berhad (TNB) said electricity consumers received rebates for 9 consecutive months from August 2025 through April 2026, followed by a surcharge beginning in May 2026. The reversal shows why a favorable adjustment cannot safely become a fixed assumption for an operator’s future electricity costs. A facility offering fixed hosting prices would consequently retain exposure unless its commercial terms address changes in the power charge. That unresolved exposure can raise the revenue threshold for committing additional capacity.
Lengthy Tier 3/Tier 4 approval cycles
A project’s investment endorsement does not settle when its planned data center capacity can become commercially usable. In Malaysia, a project may await state planning approval after federal endorsement, or obtain planning approval while utility connections are deferred. These separate decision points leave a developer exposed to a gap between permission to invest and readiness to serve workloads. For Tier 3 and Tier 4 developments, that sequencing creates a delivery risk alongside the intended facility specification. Committing construction expenditure before the remaining approvals and connections are resolved can leave capital tied to capacity that cannot yet earn hosting revenue.
*Our forecasts treat driver/restraint impacts as directional, not additive. The impact forecasts reflect baseline growth, mix effects, and variable interactions.
Malaysia Data Center Market Segment Analysis
By Data Center Size:
Phased Commissioning and Power Bands Frame Facility ChoicesLarge facilities accounted for a 23.62% share of the Malaysia data center market size in 2026. TM Nxera, the joint venture of Telekom Malaysia and Nxera, completed its Iskandar Puteri campus’s first building structural framework in April 2026, with first-phase operations targeted for the second half of 2026. The campus was designed to scale up to 200 MW, with mechanical and electrical installation, systems integration, and commissioning following the structural milestone. That sequence ties a buyer’s deployment date to commissioning of the first phase, not to the campus’s 200 MW design ceiling.
Medium facilities are the fastest-growing segment, with a forecast CAGR of 30.5% between 2027 and 2032. PLANMalaysia’s 2024 planning guideline defined medium facilities as above 5 MVA through 25 MVA and identified Infinaxis Cyberjaya at 12 MVA. The project had been expected to finish in 2025, and Sime Darby Property subsequently reported its completion that year. The guideline places the 12 MVA Infinaxis project in a commercial planning zone in Cyberjaya, showing a siting route for medium facilities in commercial areas.
By Tier Type:
AI Use and Fault Protection Define Different PropositionsTier 3 represented an 81.26% Malaysia data center market share in 2026 and is the fastest-growing segment, with a forecast CAGR of 34.4% between 2027 and 2032. In 2025, Telekom Malaysia said its Uptime Tier III data centers supported AI workloads, alongside locally hosted GPU infrastructure for developing and deploying AI solutions. This operating example links the facility specification to an application requiring computing capacity, giving the tier a role within an implemented AI ecosystem. Operators pursuing similar workloads can pair Tier III resilience with locally hosted GPU infrastructure, the combination Telekom Malaysia described in 2025.
The Tier 1 and 2 segment is forecast to contract. Uptime Institute describes Tier I as basic capacity for office IT and beyond, and Tier II as adding redundant power and cooling components while retaining exposure to unexpected shutdowns. Tier 4 uses independent, physically isolated redundant systems so equipment or distribution-path failures do not affect IT operations. However, maintenance shutdowns of redundant components or paths can increase disruption risk if another failure occurs. Tier II’s exposure to unexpected shutdowns weakens its fit for workloads that cannot tolerate interruption, a technical reason consistent with the forecast contraction.
By Data Center Type:
Colocation Scale Meets Hyperscale Fit-Out RequirementsColocation was the largest segment, accounting for 95.23% of the industry in 2026. In August 2026, colocation provider ST Telemedia Global Data Centres described planned capacity of up to 166 MW of IT load at STT Johor in Iskandar Puteri.[2] That planned scale gives a prospective customer an operator-led route to meeting large computing requirements, with the provider responsible for turning its campus plan into deliverable capacity. The commercial task is therefore to match customer commitments with completed capacity blocks, allowing the development envelope to support expansion without treating its full planned load as immediately available.
Hyperscale/self-built facilities are the fastest-growing segment, with a forecast CAGR of 30.7% between 2027 and 2032. In October 2025, Google affiliate Pearl Computing Malaysia awarded IJM Construction a mechanical and electrical fit-out contract for a hyperscale data center at Elmina Business Park, Selangor. Pearl leases the facility from developer Sime Darby Property. The fit-out award illustrates a commercial route in which a hyperscale customer commissions facility work while another company supplies the underlying property. The fit-out contractor’s opening is the specified technical environment within a leased building, making completion of those works the prerequisite for the hyperscale customer’s deployment.
By End User:
Technology Services and Continuous Settlement Support Distinct DemandIT and ITES was the largest segment, accounting for 31.34% of the industry in 2026. Malaysia’s computer programming, consultancy, information and related activities industry, including data processing and hosting, recorded 17.9% gross-value-added growth in 2025. SCICOM provides technology-enabled customer and business operations services, with operations in Kuala Lumpur and Cyberjaya. In May 2025, Microsoft named SCICOM among customers using Malaysia West, its hyperscale cloud region with in-country data residency and lower latency. The industry’s expansion and SCICOM’s use of Malaysia West connect IT and ITES activity to local cloud consumption, channeling this example’s facility demand through Microsoft’s cloud platform.
BFSI is the fastest-growing segment, with a forecast CAGR of 29.7% between 2027 and 2032. Bank Negara Malaysia launched RENTAS+, an in-house enhancement to the national real-time gross settlement system, in October 2025.[3] Built using modern cloud technology, the enhancement enables continuous interbank funds transfer and settlement 24/7, 365 days a year. For a financial institution running continuous settlement workloads, planned maintenance becomes an availability test as well as an equipment-management task. A facility unable to maintain that continuity would force a choice between infrastructure maintenance and uninterrupted interbank settlement.
By Hotspot:
Construction Programs and Acquisitions Broaden Capacity OptionsJohor Bahru was the largest segment, accounting for 53.19% of the industry in 2026. In February 2026, Leighton Asia won the main works contract for a Johor Bahru data center. The project is planned to deliver up to 57.6 MW of critical IT and network capacity across 6 colocation buildings, with completion scheduled for 2028. Open DC’s Johor Bahru City Centre JB1 had about 1 MW of IT load as of late 2025 against listed power capacity of up to 20 MW, indicating headroom at that facility. The 6-building construction program is therefore the larger near-term supplier opening, with delivery scheduled for 2028.
Cyberjaya is the fastest-growing segment, with a forecast CAGR of 29.9% between 2027 and 2032. In June 2026, Digital Realty said its newly acquired, purpose-built KUL11 data center in Cyberjaya has 15 MW of IT capacity and is designed for AI and high-performance computing workloads. The facility incorporates energy- and water-efficient design principles. The acquisition adds capacity approximately 500 meters from KUL10, extending Digital Realty’s existing Cyberjaya presence.
Geography Analysis
Johor Bahru Data Center Market
Johor Bahru accounted for a 53.19% share of the Malaysia data center market size in 2026. AirTrunk’s JHB1 is a hyperscale campus in the city. Its total capacity is 150+ MW across multiple diverse buildings. The operator positions JHB1 in Johor Bahru for international connectivity.
Cyberjaya Data Center Market
Cyberjaya is the fastest-growing geography, with a forecast CAGR of 29.9% between 2027 and 2032. In February 2026, AIMS acquired about 10 acres from Cyberview for a planned AI and hyperscale data center. Capacity was planned at up to 200 MW, subject to final engineering confirmation, with completion scheduled for 2027. Owning the land gives the proposal a physical base, while engineering confirmation determines the final capacity and the announced 2027 completion schedule defines when hyperscale customers could use it.
Kuala Lumpur gained 450 cabinets through Equinix’s May 2025 expansion, while Penang’s Open DC PE2 began operations in April 2025, supporting low-latency connectivity and high-performance computing at Bayan Lepas Technology Park. In Klang Valley, EcoWorld subsidiary Quantum Alpha’s February 2025 agreement covers building and leasing shells and associated structures to Pearl Computing’s specifications on a separate approximately 92.44-acre Eco Business Park V (EBP V) parcel. Iskandar Puteri’s planned STT Johor campus secured up to USD 1.37 billion in green financing in August 2026 to fund its development. Bukit Jalil’s AI-ready facility collaboration was announced by Malaysian Resources Corporation Berhad (MRCB) in June 2026. Buyers can distinguish completed hosting additions from construction and financing opportunities, avoiding commitments that treat announced projects as immediately available capacity.
Regulatory Framework and Outlook
The comparison of selected jurisdictions covers Malaysia’s national framework and Johor’s additional state oversight from the perspective of a developer seeking Digital Ecosystem Acceleration (DESAC) tax incentives. Planning guidance provides a common reference for authorities handling developments above 1 MVA in new areas or existing buildings. For DESAC applications received through December 31, 2027, covered organizations must declare design energy, carbon, and water performance and disclose actual water usage effectiveness (WUE) annually. Developers must therefore connect national incentive eligibility with a separate assessment of whether their proposed site and facility satisfy local review criteria.
Regulatory Table of Malaysia Data Center Market
| Decision factor | Malaysia | Johor |
|---|---|---|
| Primary authority | MIDA for DESAC applications; state and local planning authorities | Johor state government’s dedicated proposal-review council |
| Key instruments or direction | National planning reference and DESAC sustainability conditions | Proposal vetting and reported welcome criteria for water-efficient Tier 3 and Tier 4 facilities using green technologies |
| Commercial effect | Incentive qualification and annual actual-WUE disclosure for covered applicants | Proposals screened against the stated tier and resource criteria |
| Current policy attractiveness | Medium | Medium |
| Future direction of policy attractiveness | Hardening | Hardening |
| Source: Mordor Intelligence | ||
The national Medium rating reflects an incentive route conditioned on measurable design declarations and annual water-performance reporting. Johor’s Medium rating reflects its reported welcome for water-efficient Tier 3 and Tier 4 facilities using green technologies, alongside council vetting. The existing DESAC guidance recommends design WUE of 2.2 m3/MWh or lower and requires annual actual-WUE disclosure and work toward 2.0 m3/MWh or lower over 10 years from the design baseline. In September 2026, Malaysia’s Ministry of Investment, Trade and Industry (MITI) reported energy and water frameworks being developed by the Energy Commission and National Water Services Commission, supporting Hardening ratings nationally and in Johor.
Value Chain Stages
The value chain compares supplier earnings from critical infrastructure, facility construction, and recurring hosting services. Vertiv opened a facility for manufacturing, assembly, and witness testing in Senai, Johor, in July 2026 to serve customers across Asia. Gamuda Engineering Sdn Bhd and IJM Construction Sdn Bhd received Malaysian data center construction awards in August 2025. These activities create distinct earnings opportunities because equipment delivery, completed construction, and a serviceable hosting environment represent different commercial commitments.
Value Chain Analysis Table of Malaysia Data Center Market
| Primary activity | Key participants | Value capture | Bottleneck | Resilience response |
|---|---|---|---|---|
| Critical power and thermal infrastructure supply | Infrastructure manufacturers such as Vertiv | Equipment sales | Validating assemblies for the intended computing load | Witness-test assemblies before site deployment |
| Facility construction | Construction contractors such as Gamuda Engineering Sdn Bhd, IJM Construction Sdn Bhd | Construction contract revenue | Aligning building handover with infrastructure readiness | Coordinate construction milestones with equipment acceptance |
| Colocation and interconnection | Data center operators such as Equinix, AirTrunk, Digital Realty | Hosting and interconnection service fees | Converting completed space into connected customer capacity | Combine facility readiness with access to network providers |
| Source: Mordor Intelligence | ||||
The handoff between physical readiness and customer connectivity determines whether upstream project revenue becomes recurring operator income. Equinix’s Malaysian services combine colocation with interconnection, while Digital Realty’s Cyberjaya campus offers access to cloud and network service providers. For operators, accepting a completed building therefore resolves only part of the commercial task, since earning service revenue also requires the infrastructure and connections that make hosted workloads usable.
Competitive Landscape
Market Concentration
Hyperscale infrastructure builders and electrical contractors occupy different competitive roles. Bridge Data Centres (WinTriX DC Group), a Singapore-headquartered hyperscale builder, secured bank financing in March 2025 for development across Malaysia, Thailand, and APAC. On October 12, 2026, MN Holdings Bhd said its wholly owned MN Power Transmission accepted a contract to build 2 high-voltage power facilities for a data center development in central Peninsular Malaysia. DayOne Data Centers Limited completed multi-currency financing on June 11, 2025, for Johor-Singapore Special Economic Zone development, illustrating how developer funding commitments differ from the contracted electrical works supplied by infrastructure specialists.
K2 Strategic (Kuok Group), through K2 Strategic Infrastructure Malaysia, awarded Sunway Construction final-phase Johor data center works in May 2025, with completion then targeted for March 2026. AirTrunk Operating Pty Ltd. announced JHB3/JHB4 plans for Iskandar Puteri on April 30, 2026, adding more than 280 MW of IT load toward over 700 MW across 4 Malaysian campuses. On June 4, 2026, DayOne signed energy contracts with TNB Renewables and TNB Power Generation, covering approximately 1.5 GWp of solar capacity and 2.2 GWh of battery storage. The contracts use the Corporate Renewable Energy Supply Scheme (CRESS), enabling direct green-electricity sourcing from renewable developers. AirTrunk’s planned capacity expansion and DayOne’s renewable procurement place different delivery demands on construction and energy counterparties.
DayOne’s Kempas water arrangement illustrates competition extending into resource management beyond hosting capacity. In August 2026, DayOne was drawing and treating raw Sungai Tebrau water for its Kempas data center under an agreement with Johor Special Water. The state-owned counterparty supplies raw water, while DayOne undertakes treatment for the facility. On October 13, 2026, Johor’s Menteri Besar said the state welcomed only Tier 3 and Tier 4 facilities prioritizing water efficiency and green technologies. The statement signals a water-efficiency and facility-tier preference for incoming proposals, separate from DayOne’s responsibility to treat raw water under its Kempas agreement.
Malaysia Data Center Industry Leaders
-
Bridge Data Centres (WinTriX DC Group)
-
MN Holdings Bhd (in partnership with Shanghai DC-Science Co Ltd.)
-
DayOne Data Centers Limited
-
K2 Strategic (Kuok Group)
-
AirTrunk Operating Pty Ltd.
- *Disclaimer: Major Players sorted in no particular order
Malaysia Data Center Market Companies Covered in this Report
- Bridge Data Centres (WinTriX DC Group)
- MN Holdings Bhd (in partnership with Shanghai DC-Science Co Ltd.)
- DayOne Data Centers Limited
- K2 Strategic (Kuok Group)
- AirTrunk Operating Pty Ltd.
- AIMS Data Centre Sdn. Bhd. (DigitalBridge Group, Inc.)
- Telekom Malaysia Berhad
- NTT DATA, Inc.
- CSF Group
- Alibaba Cloud
- Keppel Data Centres
- Open DC Sdn Bhd
- SAP SE
- Vantage Data Centers
- Telstra Group Limited
Recent Industry Developments in Malaysia Data Center Market
- Aug 2026: Gamuda Engineering Sdn Bhd, a wholly owned subsidiary of Gamuda Berhad, was awarded contracts to build 2 hyperscale data centers in Port Dickson, Negeri Sembilan.
- Aug 2026: ST Telemedia Global Data Centres secured green financing of up to USD 1.37 billion to develop its STT Johor campus at Nusa Cemerlang Industrial Park, Johor.
- Jun 2026: Digital Realty announced its Malaysia platform launch in Cyberjaya, anchored by the operational KUL10 facility with 1.5 MW of IT capacity.
Scope and Methodology
Segmentation Overview
| Large |
| Massive |
| Medium |
| Mega |
| Small |
| Tier 1 and 2 |
| Tier 3 |
| Tier 4 |
| Hyperscale/Self-built | ||
| Enterprise/Edge | ||
| Colocation | Non-Utilized | |
| Utilized | Retail Colocation | |
| Wholesale Colocation | ||
| BFSI |
| IT and ITES |
| E-Commerce |
| Government |
| Manufacturing |
| Media and Entertainment |
| Telecom |
| Other End Users |
| Kuala Lumpur |
| Cyberjaya |
| Johor Bahru |
| Rest of Malaysia |
| By Data Center Size | Large | ||
| Massive | |||
| Medium | |||
| Mega | |||
| Small | |||
| By Tier Type | Tier 1 and 2 | ||
| Tier 3 | |||
| Tier 4 | |||
| By Data Center Type | Hyperscale/Self-built | ||
| Enterprise/Edge | |||
| Colocation | Non-Utilized | ||
| Utilized | Retail Colocation | ||
| Wholesale Colocation | |||
| By End User | BFSI | ||
| IT and ITES | |||
| E-Commerce | |||
| Government | |||
| Manufacturing | |||
| Media and Entertainment | |||
| Telecom | |||
| Other End Users | |||
| By Hotspot | Kuala Lumpur | ||
| Cyberjaya | |||
| Johor Bahru | |||
| Rest of Malaysia | |||
Market Definition
- IT LOAD CAPACITY - The IT load capacity or installed capacity, refers to the amount of energy consumed by servers and network equipments placed in a rack installed. It is measured in megawatt (MW).
- ABSORPTION RATE - It denotes the extend to which the data center capacity has been leased out. For instance, a 100 MW DC has leased out 75 MW, then absorption rate would be 75%. It is also referred as utilization rate and leased-out capacity.
- RAISED FLOOR SPACE - It is an elevated space build over the floor. This gap between the original floor and the elevated floor is used to accommodate wiring, cooling, and other data center equipment. This arrangement assist in having proper wiring and cooling infrastructure. It is measured in square feet (ft^2).
- DATA CENTER SIZE - Data Center Size is segmented based on the raised floor space allocated to the data center facilities. Mega DC - # of Racks must be more than 9000 or RFS (raised floor space) must be more than 225001 Sq. ft; Massive DC - # of Racks must be in between 9000 and 3001 or RFS must be in between 225000 Sq. ft and 75001 Sq. ft; Large DC - # of Racks must be in between 3000 and 801 or RFS must be in between 75000 Sq. ft and 20001 Sq. ft; Medium DC # of Racks must be in between 800 and 201 or RFS must be in between 20000 Sq. ft and 5001 Sq. ft; Small DC - # of Racks must be less than 200 or RFS must be less than 5000 Sq. ft.
- TIER TYPE - According to Uptime Institute the data centers are classified into four tiers based on the proficiencies of redundant equipment of the data center infrastructure. In this segment the data center are segmented as Tier 1,Tier 2, Tier 3 and Tier 4.
- COLOCATION TYPE - The segment is segregated into 3 categories namely Retail, Wholesale and Hyperscale Colocation service. The categorization is done based on the amount of IT load leased out to potential customers. Retail colocation service has leased capacity less than 250 kW; Wholesale colocation services has leased capacity between 251 kW and 4 MW and Hyperscale colocation services has leased capacity more than 4 MW.
- END CONSUMERS - The Data Center Market operates on a B2B basis. BFSI, Government, Cloud Operators, Media and Entertainment, E-Commerce, Telecom and Manufacturing are the major end-consumers in the market studied. The scope only includes colocation service operators catering to the increasing digitalization of the end-user industries.
| Keyword | Definition |
|---|---|
| Rack Unit | Generally referred as U or RU, it is the unit of measurement for the server unit housed in the racks in the data center. 1U is equal to 1.75 inches. |
| Rack Density | It defines the amount of power consumed by the equipment and server housed in a rack. It is measured in kilowatt (kW). This factor plays a critical role in data center design and, cooling and power planning. |
| IT Load Capacity | The IT load capacity or installed capacity, refers to the amount of energy consumed by servers and network equipment placed in a rack installed. It is measured in megawatt (MW). |
| Absorption Rate | It denotes how much of the data center capacity has been leased out. For instance, if a 100 MW DC has leased out 75 MW, then the absorption rate would be 75%. It is also referred to as utilization rate and leased-out capacity. |
| Raised Floor Space | It is an elevated space built over the floor. This gap between the original floor and the elevated floor is used to accommodate wiring, cooling, and other data center equipment. This arrangement assists in having proper wiring and cooling infrastructure. It is measured in square feet/meter. |
| Computer Room Air Conditioner (CRAC) | It is a device used to monitor and maintain the temperature, air circulation, and humidity inside the server room in the data center. |
| Aisle | It is the open space between the rows of racks. This open space is critical for maintaining the optimal temperature (20-25 °C) in the server room. There are primarily two aisles inside the server room, a hot aisle and a cold aisle. |
| Cold Aisle | It is the aisle wherein the front of the rack faces the aisle. Here, chilled air is directed into the aisle so that it can enter the front of the racks and maintain the temperature. |
| Hot Aisle | It is the aisle where the back of the racks faces the aisle. Here, the heat dissipated from the equipment’s in the rack is directed to the outlet vent of the CRAC. |
| Critical Load | It includes the servers and other computer equipment whose uptime is critical for data center operation. |
| Power Usage Effectiveness (PUE) | It is a metric which defines the efficiency of a data center. It is calculated by: (𝑇𝑜𝑡𝑎𝑙 𝐷𝑎𝑡𝑎 𝐶𝑒𝑛𝑡𝑒𝑟 𝐸𝑛𝑒𝑟𝑔𝑦 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛)/(𝑇𝑜𝑡𝑎𝑙 𝐼𝑇 𝐸𝑞𝑢𝑖𝑝𝑚𝑒𝑛𝑡 𝐸𝑛𝑒𝑟𝑔𝑦 𝐶𝑜𝑛𝑠𝑢𝑚𝑝𝑡𝑖𝑜𝑛). Further, a data center with a PUE of 1.2-1.5 is considered highly efficient, whereas, a data center with a PUE >2 is considered highly inefficient. |
| Redundancy | It is defined as a system design wherein additional component (UPS, generators, CRAC) is added so that in case of power outage, equipment failure, the IT equipment should not be affected. |
| Uninterruptible Power Supply (UPS) | It is a device that is connected in series with the utility power supply, storing energy in batteries such that the supply from UPS is continuous to IT equipment even during utility power is snapped. The UPS primarily supports the IT equipment only. |
| Generators | Just like UPS, generators are placed in the data center to ensure an uninterrupted power supply, avoiding downtime. Data center facilities have diesel generators and commonly, 48-hour diesel is stored in the facility to prevent disruption. |
| N | It denotes the tools and equipment required for a data center to function at full load. Only "N" indicates that there is no backup to the equipment in the event of any failure. |
| N+1 | Referred to as 'Need plus one', it denotes the additional equipment setup available to avoid downtime in case of failure. A data center is considered N+1 when there is one additional unit for every 4 components. For instance, if a data center has 4 UPS systems, then for to achieve N+1, an additional UPS system would be required. |
| 2N | It refers to fully redundant design wherein two independent power distribution system is deployed. Therefore, in the event of a complete failure of one distribution system, the other system will still supply power to the data center. |
| In-Row Cooling | It is the cooling design system installed between racks in a row where it draws warm air from the hot aisle and supplies cool air to the cold aisle, thereby maintaining the temperature. |
| Tier 1 | Tier classification determines the preparedness of a data center facility to sustain data center operation. A data center is classified as Tier 1 data center when it has a non-redundant (N) power component (UPS, generators), cooling components, and power distribution system (from utility power grids). The Tier 1 data center has an uptime of 99.67% and an annual downtime of <28.8 hours. |
| Tier 2 | A data center is classified as Tier 2 data center when it has a redundant power and cooling components (N+1) and a single non-redundant distribution system. Redundant components include extra generators, UPS, chillers, heat rejection equipment, and fuel tanks. The Tier 2 data center has an uptime of 99.74% and an annual downtime of <22 hours. |
| Tier 3 | A data center having redundant power and cooling components and multiple power distribution systems is referred to as a Tier 3 data center. The facility is resistant to planned (facility maintenance) and unplanned (power outage, cooling failure) disruption. The Tier 3 data center has an uptime of 99.98% and an annual downtime of <1.6 hours. |
| Tier 4 | It is the most tolerant type of data center. A Tier 4 data center has multiple, independent redundant power and cooling components and multiple power distribution paths. All IT equipment are dual powered, making them fault tolerant in case of any disruption, thereby ensuring interrupted operation. The Tier 4 data center has an uptime of 99.74% and an annual downtime of <26.3 minutes. |
| Small Data Center | Data center that has floor space area of ≤ 5,000 Sq. ft or the number of racks that can be installed is ≤ 200 is classified as a small data center. |
| Medium Data Center | Data center which has floor space area between 5,001-20,000 Sq. ft, or the number of racks that can be installed is between 201-800, is classified as a medium data center. |
| Large Data Center | Data center which has floor space area between 20,001-75,000 Sq. ft, or the number of racks that can be installed is between 801-3,000, is classified as a large data center. |
| Massive Data Center | Data center which has floor space area between 75,001-225,000 Sq. ft, or the number of racks that can be installed is between 3001-9,000, is classified as a massive data center. |
| Mega Data Center | Data center that has a floor space area of ≥ 225,001 Sq. ft or the number of racks that can be installed is ≥ 9001 is classified as a mega data center. |
| Retail Colocation | It refers to those customers who have a capacity requirement of 250 kW or less. These services are majorly opted by small and medium enterprises (SMEs). |
| Wholesale Colocation | It refers to those customers who have a capacity requirement between 250 kW to 4 MW. These services are majorly opted by medium to large enterprises. |
| Hyperscale Colocation | It refers to those customers who have a capacity requirement greater than 4 MW. The hyperscale demand primarily originates from large-scale cloud players, IT companies, BFSI, and OTT players (like Netflix, Hulu, and HBO+). |
| Mobile Data Speed | It is the mobile internet speed a user experiences via their smartphones. This speed is primarily dependent on the carrier technology being used in the smartphone. The carrier technologies available in the market are 2G, 3G, 4G, and 5G, where 2G provides the slowest speed while 5G is the fastest. |
| Fiber Connectivity Network | It is a network of optical fiber cables deployed across the country, connecting rural and urban regions with high-speed internet connection. It is measured in kilometer (km). |
| Data Traffic per Smartphone | It is a measure of average data consumption by a smartphone user in a month. It is measured in gigabyte (GB). |
| Broadband Data Speed | It is the internet speed that is supplied over the fixed cable connection. Commonly, copper cable and optic fiber cable are used in both residential and commercial use. Here, optic cable fiber provides faster internet speed than copper cable. |
| Submarine Cable | A submarine cable is a fiber optic cable laid down at two or more landing points. Through this cable, communication and internet connectivity between countries across the globe is established. These cables can transmit 100-200 terabits per second (Tbps) from one point to another. |
| Carbon Footprint | It is the measure of carbon dioxide generated during the regular operation of a data center. Since, coal, and oil & gas are the primary source of power generation, consumption of this power contributes to carbon emissions. Data center operators are incorporating renewable energy sources to curb the carbon footprint emerging in their facilities. |
Research Methodology
Mordor Intelligence follows a four-step methodology in all our reports.
- Step-1: Identify Key Variables: In order to build a robust forecasting methodology, the variables and factors identified in Step-1 are tested against available historical market numbers. Through an iterative process, the variables required for market forecast are set and the model is built on the basis of these variables.
- Step-2: Build a Market Model: Market-size estimations for the forecast years are in nominal terms. Inflation is not a part of the pricing, and the average selling price (ASP) is kept constant throughout the forecast period for each country.
- Step-3: Validate and Finalize: In this important step, all market numbers, variables and analyst calls are validated through an extensive network of primary research experts from the market studied. The respondents are selected across levels and functions to generate a holistic picture of the market studied.
- Step-4: Research Outputs: Syndicated Reports, Custom Consulting Assignments, Databases & Subscription Platforms
