| Study Period | 2019 - 2031 |
| Base Year For Estimation | 2024 |
| Forecast Data Period | 2025 - 2031 |
| Historical Data Period | 2019 - 2023 |
| CAGR | 10.90 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
South America Data Center Networking Market Analysis
The South America Data Center Networking Market is expected to register a CAGR of 10.9% during the forecast period.
The South America data center networking market reached a value of USD 800.08 million in the previous year, and it is further projected to register a CAGR of 10.9% during the forecast period.
- Countries such as Brazil have seen recent improvements in fixed broadband latency as demand for digital activity rises during the Covid-19 outbreak. In Argentina, the development of content delivery network (CDN) data centers is reflecting a positive trend. Overall, the market for data center networking reflects an upward trend in the region.
- The upcoming IT load capacity of the South American data center construction market is expected to reach 1800 MW by 2029. The region's construction of raised floor area is expected to increase 7.8 million sq. ft by 2029.
- The region's total number of racks to be installed is expected to reach 392K units by 2029. Brazil is expected to house the maximum number of racks by 2029.
- There are close to 60 submarine cable systems connecting South America, and many are under construction. One such submarine cable that is estimated to start service in 2025 is Carnival Submarine Network-1 (CSN-1), which stretches over 4500 Kilometers with a landing point in Barranquilla, Colombia.
South America Data Center Networking Market Trends
IT and Telecom to Hold Significant Share
- Over the past decade, South America has made huge strides in terms of developing infrastructures, although the status of its digital ecosystem varies. Although the general penetration of fixed broadband is low, significant efforts are now being made in different countries across the region to deploy fiber optic networks.
- The Chilean government has substantially invested in fiber-optic networks, with connections now reaching more than 90% of the population. Due to this, the majority of Chilean families now have access to high-speed internet services, enabling them to benefit from the expanding range of available digital services.
- In terms of 5G connectivity, all municipalities with at least 200,000 residents in Brazil will have a 5G network by July 31, 2026, with at least one antenna. Brazil's 5G spectrum auction held in October 2021 raised about USD 8.5 billion. By 2035, introducing 5G in Brazil may have a USD 1.2 trillion economic impact and a USD 3 trillion productivity boost. Overall, with increasing network traffic, the data center construction is increasing, leading to demand for major networking solutions.
- UPIX offers considerable network resources in LATAM, including last-mile capabilities throughout Brazil, and has twin headquarters in Brazil and the United States for improved agility. This provides a distinct competitive advantage and allows NJFX customers to reach a wider audience. In addition, the company provides onramps to strategic cloud partners such as AWS, Oracle Cloud, Google Cloud, Microsoft Azure, and Alibaba Cloud.
- Companies in the Mexican region are actively developing new products to gain access to local networks, which is expected to fuel the growth of the Ethernet controller market in the region. In March 2022, Arelion announced the addition of two new points of presence (PoPs) to its network in Mexico, bolstering the ecosystem in Mexico City (CDMX). This collaboration enables local access to Arelion's top-ranked global backbone, AS1299, in the MEX|5 and MEX|2 Data Centers managed by KIO Networks, bringing Arelion's total PoPs in Mexico to six.
- Businesses in Mexico City can now leverage Arelion's globally recognized backbone, AS1299, along with local access to high-speed IP Transit, Cloud Connect, DDoS Mitigation, Ethernet, and IPX services. These services are designed to meet the needs of operators, content providers, and corporations. The growth in network infrastructure in South America is expected to drive market demand throughout the forecast period.
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Brazil to Hold Significant Growth
- Brazil's digital economy demonstrates the potential for continued growth over the medium and long term. The Brazilian government plays a significant role in developing local data center infrastructure. According to the government, the country's General Data Protection Act (LGPD) was implemented in August 2020. It is now expected to force many enterprises to migrate their cloud access to private networks and update their encryption services to extend user data protection.
- As per TI Inside, in the first quarter of 2020, the network switch sales revenue in Brazil stood at USD 67.3 million, a potential increase of USD 5.9 million from the 2019 first quarter. The COVID era stood for more demand due to the major adoption of digital platforms.
- Currently, about 10-15% of data is created and processed outside a centralized data center or cloud, but the number is expected to cross 60-70% by 2025, a global trend that is also expected in Brazil. Such factors will lead to major networking infrastructure demand in terms of ethernet switches, routers, and others.
- Latin American cloud service providers are increasingly pressured to offer a unique and differentiating user experience for applications. At the same time, they need to become more efficient and reduce costs as much as possible to deviate traffic away from the regular web servers and introduce container technology that launches specific services of the ADC system.
- In Brazil, Microsoft, Amazon Web Services, and Google are the major cloud service providers. These cloud service providers will collocate their workloads with existing colocation operators and collaborate with new entrants entering the market to provide cloud-based services.
- In terms of data center construction, in May 2023, Brazilian telecom operator Megatelecom announced that they are planning to deploy dozens of Edge data centers across the country and expand its fiber backbone by 2028. To develop the edge-fiber network, Megatelecom is partnering with Union Sistemas e Energia. Such development is expected to cater to major market demand.
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South America Data Center Networking Industry Overview
The South American data center networking market is characterized by fragmentation among various players, and it has witnessed a surge in competitiveness in recent years. Key industry participants include NEC Corporation, Juniper Networks Inc., and VMware Inc., among others. These major players, boasting substantial market share, have been actively focused on expanding their customer base within the region. To achieve this, they employ strategic collaboration initiatives aimed at augmenting both market share and profitability.
In January 2022, TP-Link Corporation Ltd. made an important announcement with the launch of the Archer AXE75, an AXE5400 Tri-Band Gigabit Wi-Fi 6E router. This innovative router is designed to provide a wide range of high-performance features and is complemented by the HomeShield security system. It is equipped with a robust chipset, further enhancing its capabilities in the competitive market landscape.
South America Data Center Networking Market Leaders
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NEC Corporation
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Juniper Networks Inc.
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VMware Inc.
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A10 Networks Inc.
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Extreme Networks Inc.
- *Disclaimer: Major Players sorted in no particular order
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South America Data Center Networking Market News
- July 2023: Moxa Inc. launched its MDS-G4020-L3-4XGS series of Ethernet switches, a versatile line of Layer 3 full Gigabit modular managed switches supporting four 10GbE + sixteen Gigabit ports, including four embedded ports, four interface module expansion slots, and two power module slots to ensure sufficient flexibility for a variety of applications.
- November 2022: VMware, Inc. unveiled its next-generation SD-WAN solution, including a new SD-WAN Client, to help enterprises more securely, reliably, and optimally deliver applications, data, and services across any network to any device.
South America Data Center Networking Industry Segmentation
Data center networking refers to the set of technologies, protocols, and hardware used to connect physical and network-based devices and manage the network infrastructure, storage, and processing of application and data. Data center networking is very critical for 100% uptime of data centers. In the current web-connected world, business workloads are executed on single computers, hence leading to the need for data center networking. Networks provide servers, clients, applications, and middleware with a standard plan to stage the execution of workloads and also to manage access to the data produced.
The South American data center networking market is segmented by component type (product (ethernet switches, router, storage area network (SAN), application delivery controller (ADC), and other networking equipment) and services (installation & integration, training & consulting, and support & maintenance)), end-user (IT & telecommunication, BFSI, government, media & entertainment, and other end-users), and country (Chile, Brazil, and the Rest of South America).
The market sizes and forecasts are provided in terms of value (USD) for all the above segments.
| By Component | By Product | Ethernet Switches | |
| Router | |||
| Storage Area Network (SAN) | |||
| Application Delivery Controller (ADC) | |||
| Other Networking Equipment | |||
| By Services | Installation & Integration | ||
| Training & Consulting | |||
| Support & Maintenance | |||
| End-User | IT & Telecommunication | ||
| BFSI | |||
| Government | |||
| Media & Entertainment | |||
| Other End-Users | |||
| Country | Brazil | ||
| Chile | |||
| Rest of South America | |||
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South America Data Center Networking Market Research Faqs
What is the current South America Data Center Networking Market size?
The South America Data Center Networking Market is projected to register a CAGR of 10.90% during the forecast period (2025-2031)
Who are the key players in South America Data Center Networking Market?
NEC Corporation, Juniper Networks Inc., VMware Inc., A10 Networks Inc. and Extreme Networks Inc. are the major companies operating in the South America Data Center Networking Market.
What years does this South America Data Center Networking Market cover?
The report covers the South America Data Center Networking Market historical market size for years: 2019, 2020, 2021, 2022, 2023 and 2024. The report also forecasts the South America Data Center Networking Market size for years: 2025, 2026, 2027, 2028, 2029, 2030 and 2031.
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South America Data Center Networking Industry Report
Statistics for the 2025 South America Data Center Networking market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. South America Data Center Networking analysis includes a market forecast outlook for 2025 to 2031 and historical overview. Get a sample of this industry analysis as a free report PDF download.
