Europe data center colocation market size to reach USD 8.21 billion by 2026, growing at a CAGR of 5.61% during the forecast period. The data center colocation market in Europe is an attractive market, with data centers offering a higher Return on Investment (ROI) than other commercial and industrial properties. In 2020, the outbreak of the COVID-19 pandemic created a huge demand for cloud-based services, with the majority of the workforce shifting to remote working in Europe. The need for colocation services led to the strong utilization of existing data center space. The continuous adoption of cloud services among SMEs, with the rising interest in the digital transformation of businesses by adopting IoT, big data, and artificial intelligence, will be significant drivers for the growth of the colocation market. Governments across the region are reducing electricity prices and electricity taxes to attract data center operators to invest in their countries.
The European data center colocation market is witnessing significant investments in submarine cable projects from service providers such as Google, Facebook, and Microsoft. The increase in colocation providers involved in expanding existing capacity will continue to drive the market revenue during the forecast period. The European colocation market is also witnessing increasing investments from operators through mergers and acquisitions and joint ventures. The market witnessed the merger of Interxion and Digital Realty in Q1 2020, which was among the largest deals in the European data center colocation market. Equinix partnered with GIC, a Singapore-based sovereign wealth fund, to invest USD 1 billion in developing xScale data centers across Europe. In July 2020, Stratus DC Management, a member of the EXS Capital Group (EXS), entered a strategic partnership with Cromwell Property Group to develop new facilities across Europe.
Ericsson, Verizon, Huawei Technology, and Nokia are among the major network infrastructure providers that have provided 5G network installation infrastructure in the region.
- The construction of projects with an area of 100,000 square feet by hyperscale operators and colocation service providers has grown significantly. The Western Europe data center colocation market by area is expected to reach USD 4.14 million square feet in 2026.
- The adoption of 5G network is likely to add nearly USD 20 billion to the UK’s economy annually by 2025.
- About 86% of the data centers under the Dutch Data Center Association (DDA), representing 91% of the Netherlands market, use green energy sources to power their facilities, expected to rise to 92% green energy sources in 2025.
- Echelon Data Centres is a new market entrant in Ireland and opens wholesale colocation spaces through its Clondalkin Data Center.
- Thermal power, wind energy, and hydropower are the major sources of energy in the Norwegian market. About 98% of Norway’s energy production is renewable.
- Moscow accounts for up over 65% of overall data center space in Russia. However, multiple smaller data center projects with a floor area of less than or equal to 10,000 square feet.
- Hyperscale data center operators are involved in the rapid expansion of their cloud platforms across Europe.
- The development of green facilities creates high growth opportunities for the players to invest in the European region.
- The growth in data center investment across many European regions is also strongly attributed to GDPR.
- The European data center colocation market has witnessed investments from new entrants such as Echelon Data Centres, AQ Compute, Global Technical Realty, and Stratus DC.
This research report includes a detailed segmentation by:
- Infrastructure
- Electrical Infrastructure
- Mechanical Infrastructure
- Cooling Systems
- General Construction
- Service Type
- Tier Standards
- Geography
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