Market Trends of Taiwan Data Center Physical Security Industry
Video Surveillance is Anticipated to be the Largest Segment
- The rising demand for the video surveillance market in Taiwan has been driven by several factors, including increased construction activity, expected new data centers, and rising digitization rates.
- The Taiwanese security company is known for innovating and using cutting-edge technologies such as video analytics and AI to solve user problems. For instance, in May 2022, LILIN demonstrated an AI camera where processing happens at the edge. The company has long recognized the benefits of AI in the security field. Integration with the camera provides other benefits, such as improved bandwidth management and the elimination of space-hogging edge appliances.
- Data breaches are increasing in Taiwan, which further contributes to the growth in the physical security market. For instance, in June 2023, Taiwanese semiconductor giant TSMC admitted that one of its hardware suppliers was hacked and data was stolen.
- The growth in the development of new data centers in Taiwan would trigger market demand. For instance, in August 2022, Taiwanese Telecommunications announced that Chunghwa built a new data center in Taoyuan City. The new data center will have one basement floor and five floors above ground, with a total floor area of approximately 6,277 tsubo (223,355 square feet/20,750 square meters). Construction costs will be approximately NTD 1.59 billion (USD 53 million).
Understand The Key Trends Shaping This Market
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IT & Telecommunication is Anticipated to be the Fastest Growing Segment
- Taiwan is well-known as an ICT manufacturing hub due to its strong ICT industrial base, robust semiconductor manufacturing cluster, and advanced manufacturing capabilities. These advantages have enabled the company to quickly develop several companies that provide advanced ICT-related products and services, especially in the fields of electronic components, computers, fiber optic cables, telecommunications equipment, and information and communication technology.
- Cloud and communications are expected to contribute the largest market share among end-user industries. The cloud sector generates significant revenue due to increased data generation, driving demand for faster processing and efficient servers. Several cloud service providers, including Cadence, Google, Siemens, Azure, AWS, and Synopsys, have partnered with TSMC to form the Cloud Alliance. Other major companies also hope to enter Taiwan's cloud industry.
- As Taiwan becomes a regional hub for many companies, investments in cloud computing are being made, and demand for local data centers is increasing. The government is encouraging Taiwanese companies to go digital. The company also focuses on creating cloud-based intelligent digital blueprints for local partners and connecting best-in-class creative technologies for various industries.
- For example, in 2020, Microsoft launched its "Reinvent Taiwan" program, establishing its first cloud data center division in Taiwan. The company also made significant investments in local talent and development with the aim of increasing the number of employees to 200,000 by 2024. The goal was to make cloud data centers available to more Taiwanese people. They have digital skills.
- With an increase in smartphone users in Taiwan, the demand for telecom services is expected to grow. The Taiwanese electronics market has expanded due to the growing semiconductor sector. Taiwan produces close to 21% of the world's semiconductors. Over the past few decades, Taiwan has dramatically improved its semiconductor output, becoming a prominent participant in the sector. Such instances in the market will create more demand for data center manufacturers in the coming years.
