United States Data Center Market Report and Forecast 2024-2032

United States Data Center Market Outlook

The United States data center market size reached approximately USD 18.50 billion in 2023. The market is projected to grow at a CAGR of 9.5% between 2024 and 2032, reaching a value of around USD 42.10 billion by 2032.

Key Takeaways

• The United States boasts 2,701 data centers in 2022, followed by Germany, the UK, and China.

• Data centers are concentrated in major US cities such as Seattle, Dallas, Los Angeles, Portland, Chicago, and Atlanta, among others.

• Northern Virginia is a major hub of data centers, attributed to its proximity to physical infrastructure that forms internet foundations.

A data center is a physical facility that houses multiple computers to process, store, and share data. It centralises an organisation's IT operations and provides services such as data storage, management, backup, and recovery. The United States is one of the largest-growing economies in the world, which is likely to boost the growth of public cloud-based data centers in the forecast period.

Furthermore, The IT industry dominates the United States as the largest private sector employer in the country, where data centers are widely used. In recent years, the importance of data centers has increased worldwide due to the increasing digitisation of business processes, cloud usage, and big data. The United States data center market growth can be attributed to changes in working habits, technological advancements and the growth of cloud-based technologies, among others.

Key Trends and Developments

The rising popularity of e-commerce platforms, growing internet users, the rising norm of work-from-home, and technological advancements and innovations are positively impacting the United States data center market growth.

United States Data Center Market Trends

E-commerce companies are investing heavily in new data centers to improve their management practices. For instance, Walmart is one of the major e-commerce brands contributing to the data center boom in the United States.

E-commerce companies can leverage the data that they accumulate and use it to form incredibly useful insights on their customers and optimise their business processes. By quietly observing their consumption habits, companies can learn not only about current behaviours but also about future trends.

The emergence of 5G technology, machine learning, and artificial intelligence is significantly surging data volume, aiding the United States data center market growth. Hyperscale data centers are significantly gaining popularity as they can scale up quickly to meet rising data volumes, provide flexibility to users, and reduce downtimes. Moreover, the rising demand for cloud services and the growing requirements for efficient and reliable capacity is surging the adoption of hyperscale data centers.

Market Segmentation

“United States Data Center Market Report and Forecast 2024-2032” offers a detailed analysis of the market based on the following segments:

The demand for colocation data centers is expected to increase due to its positive attributes including scalability, physical security, and better connectivity.

As per the United States data center market analysis, the demand for colocation data centers (colo) is increasing due to their ability to provide an ideal environment for accommodating hybrid cloud infrastructure, provide high-speed connectivity, and ensure strict security measures, among others.

Under this facility, multiple clients rent a floor, rack space, and equipment from a third-party supplier to facilitate their own data center needs. This type of data center helps small businesses with limited IT resources to get computing power and storage.

The increasing launch of colocation solutions is also propelling the United States data center market. For instance, in August 2023, Digital Realty announced the availability of PlatformDIGITAL®, high-density colocation services that enable businesses to overcome proximity and processing challenges associated with unstructured data.

Meanwhile, the demand for edge data centers is increasing in the US amid the rise of streaming devices, personal devices, and smart technology. As this data center is located at the edge, it creates lower latency and increases IT security and reliability. In addition, hyperscale data centers are increasingly being developed due to their improved cooling efficiency, enhanced energy efficiency, and improved economies of scale.

In December 2023, Digital Realty established a joint venture with Blackstone Inc. to develop four hyperscale data center campuses in Frankfurt, Paris, and Northern Virginia to support nearly 500 megawatts (MW) of total IT load.

The demand for data centers in BFSI is expected to increase due to the former’s ability to ensure safety and security.

The BFSI sector represents a significant portion of the United States data center market share. In the fast-moving world of finance, data centers play a vital role in ensuring the security and efficiency of transactions. Financial institutions include organisations such as banks and investment firms that rely on the data center to control and process huge amounts of data related to day-to-day operations.

The market is anticipated to grow at a healthy pace in the forecast period as data centers provide advanced security measures, such as biometric authentication and 24/7 monitoring, to ensure that financial data is guarded against unauthorised access and cyber threats.

Moreover, the United States data center market expansion is being fuelled by the growing adoption of digital technologies such as Electronic Patient Records (EPR), geolocation services, and nurse call stations in the healthcare sector. Data centers are crucial to streamline the management and storage of medical prescriptions and records.

Meanwhile, the retail and e-commerce sector uses data centers to prevent downtimes, enhance security, improve flexibility and power online applications and services. Retailers are increasingly focusing on providing a personalised and efficient shopping experience to customers, surging the demand for data centers to enhance operational efficiency, improve productivity, and reduce costs.

Competitive Landscape

United States data center market players are focusing on technological advancements and innovations to gain a competitive edge

Other players in the United States data center market are Alphabet Inc., Equinix, Inc., Digital Realty Trust Inc., CyrusOne Inc., DataBank, Ltd., NTT Ltd., Flexential Corp., and Vantage Data Centers Management Company, LLC, among others.

In October 2020, DataBank, a leading provider of enterprise-class edge colocation, interconnection, and managed services, acquired 95 acres of land near Lithia Springs in Atlanta. This acquisition is aimed at dramatically expand its capacity and ability to meet the growing regional demand for colocation space and power over the next decade. DataBank helps the world's largest enterprises, technology, and content providers ensure their data and applications are secure, compliant, and ready to scale to meet the needs of the artificial intelligence era.

Key Highlights of the Report

United States Data Center Market Report Snapshots

United States Data Center Market Size

United States Data Center Market Trends

United States Data Center Companies