Modular Data Center Market SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2023 - 2030)

Modular Data Center Market Analysis

The global modular data center market size was valued at US$ 18.49 billion in 2023 and is expected to reach US$ 87.65 billion by 2030, grow at a compound annual growth rate (CAGR) of 24.9% from 2023 to 2030.

Modular data centers are prefabricated computing facilities designed for scalable data center capacity and quick deployment. They provide benefits like flexibility, cost-efficiency, enhanced power management, and lean maintenance over traditional data centers. Key drivers of the modular data center market include the rising demand from colocation providers, growing need for energy-efficient data centers, increasing adoption by SMEs and favorable government initiatives promoting green data centers.

The Modular Data Center Market is segmented by component, data center size, tier type, industry, and region. By component, the market is segmented into functional modules, data center infrastructure, services, and power & cooling modules. The functional module segment accounted for the largest share in 2022. It includes IT modules, electrical modules, mechanical modules, and others. Functional modules are essential elements of a modular data center and their adoption is rising owing to benefits like reduced time-to-market and enhanced scalability.

• Growing Demand for Scalable and Agile Data Center Capacity: The demand for data center capacity is growing rapidly driven by factors like rising data traffic, Internet of Things (IoT) adoption, big data analytics, and cloud computing. Many organizations are moving workloads to colocation facilities or cloud platforms. This is driving the need for scalable and agile data center capacity that can be added quickly as per demand fluctuations. Modular data centers fulfill this requirement with their prefab modular architecture that allows fast deployment and capacity expansion. The modular design enables data center owners to scale up or down based on actual compute needs. This driver is reinforced by innovations in modular data centers like enhanced power densities, cooling methods, management software etc.
• Need for Lower OPEX and Enhanced Operational Efficiency: Modular data centers help organizations reduce operating costs and improve efficiency in facility management. As they come pre-integrated with IT/power/cooling infrastructure, modular data centers simplify deployment and ongoing operations. They reduce time and effort needed for planning, rack assembly, cabling, testing etc. Vendors offer remote monitoring software and services for lean operations. Modular architecture enables consistent environments and minimizes human errors. The streamlined management translates into lower operating expenditure for organizations. With rising energy costs, the energy-efficient designs of modern modular data centers also help rein in utility expenses.
• Increasing Adoption of Containerized Data Centers: Containerized data centers are gaining rapid traction as they pack entire data center functionality into a standard intermodal container. They provide quick deployment, mobility, scalability and cost benefits for compute-intensive applications like cloud gaming and IoT edge networks. Containerized data centers come pre-integrated with precision cooling, fire detection/suppression, redundancy, and remote monitoring. Their uptake is increasing among organizations that need easily relocatable data center capacity, including the military, disaster recovery providers, mining firms and mobile network operators.
• Growing Popularity of Micro Data Centers: Micro data centers are self-contained systems encompassing IT rack enclosure, power, cooling, security, management software etc. Their compact size and plug-n-play designs make them well-suited for edge computing applications across verticals like retail, manufacturing, telecom etc. Micro data centers allow processing of time-sensitive data closer to end-users and IoT devices. Their adoption is rising since they overcome bandwidth constraints and latency issues associated with centralized data centers in IT environments with distributed assets. Micro data centers accelerate localized processing for technologies like VR/AR, video analytics, autonomous vehicles etc.

Modular Data Center Market Trends

• Innovations in Power Equipment for Improved Resiliency: Vendors are offering modular power infrastructure with hardening, redundancy and certified integration for maximized availability. For instance, Delta offers Eco Power Monitors to analyze quality of power delivered. Schneider provides shock-proof medium voltage switchgear. Huawei offers modular liquid cooling solutions reducing PUE below 1.2 for high efficiency. Such advances are ensuring resilient, uninterrupted power delivery crucial for continuity of modern always-online applications.
• Prefabricated Data Centers Gain Traction: Prefabricated modular data centers built via factory pre-integration and testing are gaining impetus. They promise accelerated deployment, controlled environments, minimal errors and consistent quality. Colo providers like ST Telemedia, Global Switch, and Digital Realty have adopted prefabricated designs. Huawei's Modular Data Center Product Portfolio encompasses prefabricated modules, IT/power/cooling infrastructure and management software for rapid capacity rollouts.
• Growing Adoption of AI-enabled Monitoring and Management: AI and big data analytics are increasing being leveraged by modular data center vendors to enable intelligent remote monitoring and streamline management. Machine learning algorithms help analyze parameters like rack conditions, airflow, humidity levels, track failure patterns and even predict future anomalies. This allows timely servicing and prevention of outages. Chatbots ease IT teams' efforts via conversational interfaces. AI is transforming modular facilities into self-driving data centers improving uptime and staff productivity.
• Innovative Cooling Techniques and Free Cooling Utilization: Vendors are offering cutting-edge cooling systems for modular data centers to lower energy consumption, including zero-water liquid cooling, rear-door heat exchangers, containment systems, and shrimp farms. Scavenging of external ambient air via free cooling modes is also being smartly enabled leveraging IoT sensors, predictive modeling and PUE optimization engines. For instance, Schneider Electric's EcoBreeze utilize AI to make real-time cooling adjustments using free air. Such techniques ensure optimal cooling while reducing redundant air conditioning.

Modular Data Center Market Regional Insights

• North America is expected to be the largest market for Modular Data Center Market during the forecast period, accounting for over 38.5% of the market share in 2022. The growth of the market in North America is attributed to early adoption of advanced technologies, presence of leading colocation and cloud service providers, and growing investments in edge computing solutions.
• The Europe market is expected to be the second-largest market for Modular Data Center Market, accounting for over 32.1% of the market share in 2022. The growth of the market in is attributed to high demand from the UK, Germany, France and the Netherlands along with strict government regulations around emissions.
• The Asia Pacific market is expected to be the fastest-growing market for Modular Data Center Market, with a CAGR of over 26.7% during the forecast period. The growth of the market in Asia Pacific is attributed to rapidly growing data center infrastructure, increasing adoption of cloud computing and IoT, and growing digitalization in countries like China, Japan and India.

Figure 1. Global Modular Data Center Market Share (%), by Region, 2023

Recent Developments in Modular Data Center Market

Modular Data Center Market Segmentation