Market Trends of Sweden Data Center Networking Industry
IT & Telecommunication Segment Holds the Major Share.
- The cloud segment is the primary contractor for data center services in Sweden, followed by the telecom segment. By 2021, it was estimated that 5G connections in Swedish accounted for 6.2% of the country's overall mobile connections. Operators have been intensively focusing on network investments to expand 5G coverage across Sweden.
- Telecom operators aim to offer 5G coverage to more than 90% of the population by 2023, driving the increasing need for high-computation facilities in the country, expected to boost the market over the forecast period.
- The growth in mobile data traffic per smartphone is primarily caused by improved device capabilities, increased data-intensive content, and ongoing network performance improvements. Notably, the number of Facebook users increased from 7.9 million in 2021 to 8.7 million in 2022, accounting for 84.4% of the population. Similarly, the number of Instagram users grew from 5.03 million in 2021 to 6.06 million in 2022. Additionally, the Swedish Association of Local Authorities and Regions (SALAR) developed a vision for a Swedish e-health strategy, investing 1.21 billion annually in healthcare IT.
- As the number of smartphone users in Sweden rises, it results in increased connectivity across the country. Operators, like the joint venture between Tele2 and Telenor called Net4Mobility, are focusing on accelerating the 5G network expansion. Tele2 and Telenor Sweden plan to extend Net4Mobility's reach to 90% of the Swedish population by the end of 2023 and cover the remaining 20% in 2024. Telia Sweden also aims to achieve 5G coverage equivalent to its 4G network by 2025 through collaboration with Ericsson. It intends to cover more than 90% of the population by 2023, eventually extending to 90% geographic and more than 99% population coverage.
- The growth of broadband connectivity in Sweden is driven by increased demand for data consumption by households and businesses, further encouraged by government initiatives. Moreover, the extensive use of wireless devices and growing internet connections is heightening the demand for online cloud platforms. The increasing digital penetration of devices like computers, which rose from 89.72% in 2017 to 94.36% in 2022, has notably increased data traffic over broadband channels, substantiating the growth of cloud computing services. These developmental aspects are expected to complement the growth of data centers in the region and substantiate the growth of network devices and services in the market.
Understand The Key Trends Shaping This Market
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Ethernet Switches Holds Largest Market Share
- In Sweden, Ethernet switches play a multifaceted role within data center facilities, serving as critical components for ensuring efficient, reliable, and secure communications. These switches support a wide array of digital services, applications, and transactions. Acting as the backbone of a data center, Ethernet switches facilitate seamless communication among servers, storage devices, and other networking equipment, enabling necessary connectivity to facilitate data flows within the facility.
- The country's reputation as a hub for innovation and technology further amplifies the indispensability of Ethernet switches in data centers. These switches are vital in meeting the networking needs of research institutions, technology companies, and innovation centers, fostering collaboration and technical advancement.
- Sweden's strong commitment to sustainability and its prominent position in renewable energy adoption aligns with the utilization of Ethernet switches for energy-efficient practices within data centers. Integration with renewable power sources underscores the country's dedication to sustainable technology infrastructure.
- Moreover, Sweden boasts a high level of digital readiness, evidenced by its significant internet usage, social media engagement, mobile connections, 5G adoption, online commerce, and digital payments. Notably, according to GSMA's Q2 2022 report, Sweden led the Nordic region in 5G median download speed, a testament to the country's robust digitalization strategy. Consequently, these factors drive substantial demand for data centers, escalating the need for more Ethernet switches within these facilities.
- The market's major players are actively updating network devices to meet the escalating demands. For instance, in November 2022, Siemens launched the new generation of Siemens Industrial Ethernet Switches. This next-gen series, replacing the current Scalance X-300 series, includes the 'Scalance XCN 300' in the compact version and the Scalance XR305XRM for 19-inch versions. Notably, these switches aim to enhance OT/IT collaboration, reinforcing their importance within evolving data center infrastructures.
