Market Trends of Switzerland Data Center Physical Security Industry
The IT and Telecommunication Segment Holds a Major Share in the Market
- The Swiss data center market has also been driven by growing cloud use across companies because of their increasing integration of emerging technologies like artificial intelligence, big data, and blockchain. Cloud computing (anything-as-a-service (XaaS)) continues to be one of the most important trends in the Swiss IT industry. However, while most cloud solutions are still deployed in-house (besides traditional outsourcing and managed services), software-as-a-service (SaaS), in particular, is becoming increasingly important as a procurement model.
- Globally leading hyperscalers, namely AWS, Google, and Microsoft, now have a presence in Switzerland. Since 2019, they have invested intensively in developing their Swiss cloud regions and attracting new customers. For instance, AWS plans to invest USD 5.9 billion into the local economy through 2036. The 15-year investment plan will help drive local cloud adoption and add USD 16.3 billion to the Swiss GDP. In 2021, cloud expenditure in Switzerland was more than CHF 4.93 billion (USD 5.42 billion).
- By 2022, only a few companies, approximately 5%, were not using any cloud services, suggesting an upward trend and, hence, increasing demand for data processing facilities. Additionally, scalable and strong cloud networks are being developed with the help of hyperscale data centers, which can enhance customer satisfaction, increase availability, and cut costs. Considering the above developments, the cloud data center segment is expected to account for a majority of capacity in the Swiss data center market by 2029.
- Additionally, in telecom, rising 4G adoption and the impending 5G wave are encouraging telecom companies to make investments in the Swiss data center market. In 2021, 99% of the population was covered by LTE (4G). By the end of 2021, Swisscom reached 98% of the population with 5G and transmission rates of up to 1 Gbps and 31% with 5G+ and transmission rates of up to 2 Gbps, while Sunrise UPC covered over 96% with 5G and transmission rates of up to 1 Gbps. By 2022, 90% of homes and companies in the country were connected to Swisscom's ultra-fast broadband services. Such instances in the market are expected to create more need for data centers, resulting in rising demand for data center physical security solutions in the coming years.
- Key players in the market focus on improving the data center's physical security solutions to meet the market demand. In June 2023, Bosch introduced a Mobile Access solution to buildings and restricted areas, which allows access without any identification media such as plastic cards. It is fully integrated into the tried-and-tested Access Management System from Bosch and provides various benefits, including efficiency, security, and convenience for building owners, visitors, and employees. This was initially available to customers in the Benelux region, Switzerland, Germany, Austria, Canada, and the United States.
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The Video Surveillance Segment Holds the Largest Market Share
- Data centers are home to sensitive and vital data, which makes security their highest priority. Data center operators help ensure that security standards and regulations are respected through video surveillance systems, which provide them with monitoring of access, detection of unauthorized entry, and maintaining compliance.
- The Swiss legislation on data protection has strict provisions requiring operators of data centers to comply with them. By enhancing physical security measures, video surveillance contributes to the maintenance of compliance.
- Switzerland is an international finance center with a significant presence in the financial services sector. Banks have a strong data center requirement to perform activities such as banking, trade, and compliance with finance regulations. Protecting and safeguarding the data is very crucial, as per the regulations. Such instances in the market create more demand for data center physical security players in the region.
- Furthermore, factors such as growing connectivity and online shopping would contribute to the increasing generation of data and processing facilities. The country's internet penetration 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 2018 to 7.9 million in 2023.
- Moreover, in 2021, Switzerland ranked first in the annual e-commerce index of UNCTAD, which ranks countries on their readiness to engage in e-commerce. Online shopping was found to be preferred by about 11% of Swiss customers, and this share was expected to reach 22% in 2022. Such improvements in the market propel the growth of data centers and, consequently, the rise of DC storage demand in the country.
- Key players in the market focus on improving the data center's physical security solutions to meet the market demand. In June 2023, Bosch introduced a mobile access solution to buildings and restricted areas, which allows access without any identification media such as plastic cards. It is fully integrated into the tried-and-tested access management system from Bosch and provides various benefits, including efficiency, security, and convenience for building owners, visitors, and employees. This was initially available to customers in the Benelux region, Switzerland, Germany, Austria, Canada, and the United States.
