Market Trends of Singapore Data Center Networking Industry
IT & Telecommunication Segment Expected to Hold Major Share in the Market.
- Demand for new data centers is soaring, driven by the escalating need for hyperscale facilities required by major internet providers like Amazon Web Services (AWS), Microsoft, Google Cloud, and Alibaba Cloud to bolster their cloud services. This surge will bolster the domestic data center storage market, resulting in increased market revenue.
- Singtel is intensifying its deployment of 5G standalone (SA) in Singapore by expanding the network and exploring new 5G use cases in partnership with Ericsson. By September 2021, Singtel confirmed that its 5G network covered over two-thirds of Singapore, with additional 5G sites established in densely populated areas such as Choa Chu Kang, Punggol, Sembawang, and Tampines.
- Furthermore, the burgeoning use of smartphones, the rapid adoption of 5G networks, and increased data traffic from mobile phones and computer games have solidified the telecommunications sector's dominance. This will significantly impact the growth of data centers in the country, increasing the demand for data storage, necessitating more data center storage equipment, and, subsequently, boosting market value.
- The country boasts a fully urbanized population with 8.7 million cellular mobile connections, surpassing 147% of its total population. This data suggests that each citizen in the country owns more than one cellular device. The growing application of connected devices and smart homes has amplified the demand for digital data, leading to increased network traffic. Such factors are expected to drive an increase in the country's data center capacity.
- Data centers need to scale their storage infrastructure to accommodate this intensified workload, which may involve integrating flash storage, additional drives into existing data centers, or constructing new ones. The upsurge in data center numbers directly correlates with the demand for storage devices in IT infrastructure. As the number of data centers increases, the need for storage devices to meet the expanding computing needs grows.
- Data centers play a pivotal role in national security, internet infrastructure, and economic performance. The country is witnessing rapid growth in its data center infrastructure, fueled by a growing preference for cloud services and increased data consumption and generation by the expanding digital user base. This amplifies the usage of data centers and concurrently boosts the use of networking devices in data centers, positively impacting the market.
- Increasing internet penetration, the expanding use of social networks, advancements in automation technology, smart city initiatives, and widespread implementation of AI across industries are propelling investments in data centers. As the number of data centers rises, so does the demand for data center networking in the country
Understand The Key Trends Shaping This Market
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Ethernet Switches Holds Largest Market Share
- Data center Ethernet switches serve as crucial network devices within a data center environment, facilitating efficient and rapid data transfer by establishing connections between servers, storage devices, and other network equipment. These switches are specifically designed for high-speed data transmission, supporting gigabit and multigigabit Ethernet, including 10GbE, 25GbE, 40GbE, 100GbE, and beyond.
- Data Centers across Singapore extensively employ Ethernet switches. As businesses in Vietnam expand, the need for increased processing capacity necessitates Scalable Ethernet switches to enable the expansion of data center infrastructure. This scalability is vital to meet the rising demands of digital services.
- In response to the increasing adoption of cloud services by Singaporean businesses, Ethernet switches play a pivotal role in connecting on-premises data centers to cloud resources. This connectivity is crucial for enterprises seeking to leverage both on-premise and cloud infrastructure, particularly in terms of cloud deployment.
- The growing focus on digitalization, coupled with high Internet penetration (Singapore reached 5.81 million Internet users with a penetration rate of 96.9% as of January 2023) and a doubling in credit card transactions from 418.39 million in 2017 to 693.41 million in 2021, highlights the increasing need for storage facilities due to expanding E-commerce sales. These trends drive significant demand for data centers and, consequently, an increased need for Ethernet switches within these centers.
- Key market players are actively updating network devices to meet this demand. In January 2023, responding to the evolving needs of today's data center environment, Dell Inc. introduced the Power switch S520ON 25GbE fixed switches, featuring All Technologies' latest disaggregated hardware switching and networking solutions. These switches offer state-of-the-art high-density 25GbE ports and a wide range of functionalities, ensuring optimal flexibility and cost-effectiveness. They cater specifically to Web 2.0, cloud service providers, and enterprises managing demanding compute and storage network traffic environments.
