Thursday, 20 August 2015 Blog ehdf

UAE's Data Centre Services to Reach $971m by 2018

Trends such as Internet of Things (IoT), mobility, cloud and social media have been responsible for the exponential growth of data and higher complexity of enterprise computing workloads. This means that an organisation’s IT infrastructure also needs to grow at the same pace. However, building or expanding their own data centre facility could become quite expensive for businesses. Hence, more and more businesses are now considering colocation, which is a third party data centre facility that allows businesses to rent space for their servers and other computing hardware.

Drivers for increased uptake of colocation

Continuously surging demand for data storage and its reliable and efficient processing is impacting the data centre infrastructure market. In the present scenario, most organizations are facing saturated data centre capacity, in terms of power, cooling, and space. Therefore, companies are either expanding their existing data centre capacity or using colocation facilities for their new workloads. This is a major driver for the data centre colocation market in the UAE.

Colocation is being considered by businesses of all sizes for varied reasons – Small Businesses can obtain needed features of a large data centre without the capital investment, whereas medium to large sized enterprises can expand their existing infrastructure capacity without undertaking costly data centre construction.

Across vertical sectors, there is a demand for colocation to help deliver greater efficiency. Colocation is almost always more efficient in terms of energy and cooling costs than having equipment in server rooms within organizations as service providers can leverage economies of scale due to their large customer base.

The need to minimize latency and enable faster access to applications drives regional colocation growth for organizations with users based in the region. The need for increased data protection, business continuity and disaster recovery have also fueled the colocation market as organisations consider colocation facilities for their DR sites. Due to significant increase in power, bandwidth and cooling requirements for data centre equipment, many legacy-built data centres are unable to accommodate these new power and cooling demands. This too has driven the upward demand in the data centre colocation market.

Colocation market in the UAE

According to figures released in a recent report by the International Data Corporation (IDC), the UAE’s managed and data centre service market is expected to be valued at $971.8mn by 2018. As more and more data centres are established and utilized among large corporations and SMEs, several verticals will increase their demand for colocation. The expected growth stems from increasing demand amongst end-users who are trying to match the higher level of IT agility and increased operational efficiency expected in the modern market.