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Summary

The global data center market has exhibited robust growth, with its valuation reaching $215.8 billion in 2021 and anticipated to expand at a CAGR of 4.95%. Dominated by the United States, which houses ten times more data centers than Germany, the second-ranking country, the market has seen significant investment activities. The French market, while expanding more slowly compared to other European counterparts, has displayed steady growth with a 7.42% average annual growth rate between 2015 and 2022. Demand is driven by data-intensive sectors and the adoption of advanced technologies like 5G and edge computing. In 2019, Paris ranked 6th worldwide in data center customers. On the regulatory front, European and French laws shape market dynamics by emphasizing data protection, energy efficiency, and compliance with third-party standards. Key global players include Equinix, Digital Realty Trust, and Chinese telecom giants, alongside cloud service providers like Microsoft, Google, and Amazon..Demand Dynamics in the French Data Center Market: A Dive into Trends and Key Figures The French data center market has been exhibiting a robust growth trajectory, fueled by technological advancements, the uptick in digital integration, and the proliferation of cloud services. A closer examination reveals that market size is expanding at a formidable pace, with an average annual growth rate hovering between 7 and 8 percent over the recent years. As of the last measured period, the number of sizable data centers in France has soared, nearly doubling, which showcases the burgeoning demand for cloud services powering this expansion. The market dynamics are shaped significantly by sectors that are data-intensive in nature. A striking trend is the surge in Internet usage, with active global Internet users now comprising around 70 percent of the world's population, marking an increase of over 1400 percent since the year 2000. This surge is largely attributed to the rise of data-consuming applications such as video streaming, e-commerce platforms, and the ubiquitous presence of social networks. Furthermore, the digitization of businesses is also propelling the demand for data center services, particularly in the cloud computing segment. The majority of enterprises are now leaning towards services like file storage, showcasing a high uptake of data center capabilities. Remarkably, sectors intricately intertwined with technology, such as information and communications, are the forefront runners in utilizing data center services. Besides, the trend indicates an upward shift in the number of companies incorporating cloud solutions, amplifying the demand for data centers. On a geographical note, France's data center activities are primarily clustered in its key urban conurbations, with Paris being the predominant hub. This concentration is manifest in the fact that locations like Paris, Marseille, Lyon, Lille, and Strasbourg cumulatively account for a significant majority of the national total, evidencing a correlation with the areas known for their tertiary sector vigor. Moreover, with advancements such as 5G technology and pioneering computing methods, there's a forecasted growth in data center requisites. The 5G evolution, for instance, is anticipated to revolutionize various sectors including IoT, home automation, and smart cities. Subsequently, estimates suggest a substantial portion of demand will gravitate towards cloud-centric systems to cater to these emerging needs. The deployment strategies for 5G infrastructure reveal diverse approaches, with companies like Free installing a broad range of 700 MHz antennas, aimed at broader coverage albeit with lower throughput. On the other end, companies like Orange pivot towards a network strategy characterized by fewer antennas but with each delivering higher performance.### Key Market Players Shaping the Global Data Center Landscape As the digital revolution powers forward, an array of companies has positioned themselves at the forefront of the data center market. Among them, industry giants such as Equinix, China Telecom, NTT Communications, and Digital Realty Trust are leading the charge in the global co-location data center sphere. These providers are distinguished by their extensive facility networks and the comprehensive suite of services they deliver, catering to a diverse range of customer needs and driving innovation in data management and processing. On the other hand, certain global companies hold a firm grip on the wholesale data center market. Notably, Digital Realty Trust stands tall in this segment, known for its large-scale operations that provide substantial space and power for major users. Another notable name is Global Switch, which has marked its presence as a significant player managing large data center spaces. The local landscape is enriched by specialized service providers such as Vinci Facilities and Jerlaure, which focus on equipment supply and energy management, illustrating the significance of operational sustainability and efficiency in the data center industry. Delving into data storage and processing services, local champions like OVH and Iliad reflect the dynamism of regional markets. OVH, in particular, has emerged as an influential power in Europe, boasting impressive growth and an expansive server portfolio. Similarly, APL France demonstrates prowess in the localized market, offering tailored data center solutions. When it comes to cloud computing, the big hitters such as Microsoft, Google, and Amazon are impossible to overlook. These titans not only command the cloud services sector but also operate massive, hyperscale data centers integral to the interconnected fabric of the internet. In essence, the current market is a mosaic of international leviathans and specialized, regionally focused firms—all contributing to a robust and diverse global data center ecosystem. With continuous development in technologies like 5G and advanced computing, these players are not just responding to the current demands but are also shaping the future of data storage, processing, and cloud computing services.
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  • Number of pages : 30 pages
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  • Last update : 22/04/2024
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Summary and extracts

1 Market overview

1.1 Data center market definition and overview

Data centers comprise a vast network of interconnected servers and computer components used by organizations to store and maintain data. Data centers are located in large warehouses in geographical areas with advanced connectivity and technological infrastructure. The components of a data center include mainframe computers, servers, disk array storage racks, networking and telecommunications equipment, etc.

In this study, a distinction is made between two forms of data center:

  • traditional ("on-prem") data centers ;
  • cloud services data centers.

Although the function and ultimate purpose are the same, the two methods of data storage vary. In section 3.4, we'll develop this difference.

The global data center market is booming, and is set for sustained growth in the years ahead for a number of reasons, including greater digital and technological integration, the increasing exchange of information linked to the Internet, and the growing use of cloud services.the global market for data centers is booming, and should see sustained growth in the years to come, for a number of reasons, including greater digital and technological integration, the growing volume of information exchanged via an increasingly powerful Internet, the need to outsource data for security and cost reasons, and the rise of connected devices. The global market is dominated by North America and Asia.

In France, the market is also expanding, albeit at a slower pace than some of its European counterparts. In particular, 5G and advanced computing are driving this expansion. Paris is the dominant location for data centers in France.

1.2 A growing global market dominated by the United States

The global data center market is valued at $***.* billion in ****, and is expected to grow at a CAGR of *.**% over the following period. This is impressive growth, fuelled by increasing demand for data centers caused by the digitization of the world, increasingly advanced technologies and the development of technologies such as ...

1.3 The French market is expanding

According to the INSEE classification "Data processing, hosting and related activities" NAF code: **.**Z, which perhaps broadens our market perimeter a little, and which takes into account sales excluding VAT, we can establish the market size of data centers in France.

Growth in sales of data processing, hosting and related activities France, ...

1.4 The crucial role of data centers in the age of global pandemics and the rise of teleworking

In ****, when confinement made teleworking compulsory, the entire communications sector underwent a veritable upheaval in its organization due to an exceptional increase in Internet traffic.

Crucial to maintaining network stability, data centers were given critical infrastructure status in some countries during the Covid-** crisis. This is due in particular to the ...

2 Demand analysis

2.1 Data-intensive sectors and services dominate demand

The datacenter is essential to the operation of networks: otherwise a website or mailbox wouldn't work. It can be operated internally or externally, with the support of service providers. It provides IT services and enables software to function.

Standardizing Internet usage and data consumption

As of June **, ****, Internet statistics show that ...

2.2 Advanced computing and 5G boost demand for data centers

According to Les Echos, several key aspects will be the main drivers of data center demand in the future:

*G The fifth-generation wireless network standard will see the expansion of the mobile Internet into the Internet of Things (***), home automation and smart cities. What's more, efficiency is set to increase: ...

2.3 Private data centers prevail

How organizations are meeting their demand for advanced IT capacity World, ****, in Source: ****

The chart above illustrates the different types of data center most in demand. We note that in **% of cases, companies use their own data centers (***). This may be because it excludes third-party costs, and therefore saves money. But ...

2.4 Demand from SMEs

The graph below shows a breakdown of data center customers worldwide.

Breakdown of companies using data centers to bring applications online Worldwide, ****, in Source: ****

This data shows that SMEs (***), and so they outsource the service.

In second place, we find enterprises (***). We can therefore conclude that smaller companies are more likely ...

3 Market structure

3.1 An increasingly concentrated sector

Today, there are some *** data centers in France. The market represents a mix of foreign and local players.

Access to initial financing is very important, as it is the initial cost (***) that is most important, with revenues guaranteed by growing demand.

On a global scale, the industry has been affected by ...

3.2 France's investment in digitization will stimulate the creation of data centers

There are a number of points to consider when estimating where the French data center market is heading in terms of capacity, investment and expansion.

First of all, France is already an attractive target market: it's the third-largest ICT market in Europe. What's more, its workforce is highly qualified, as the ...

3.3 French data centers are located around Paris

Companies' enthusiasm for Cloud Computing has led to a strong demand for data centers in Paris: financial institutions in particular.

The focus here is on neutral data centers (***).

Distribution of data centers in France France, ****, in units Source: ****

Regional distribution of neutral data centers in France France, ****, in deliverable IT power Source: ...

3.4 Cloud computing and data storage - a disruption?

We need to distinguish between traditional on-prem data centers and cloud computing services, which also use data centers, but in a different way. For example, on-prem data centers require substantial initial investment in hardware. In contrast, cloud services require an organization to pay for the portion of hardware it uses ...

4 Offer analysis

4.1 Data center services

In this study, we have broken down the definition of a data center into two segments: (***) host service providers and cloud providers. The decomposition can be continued through the following:[***]

Cloud; SaaS ; PaaS ; Hybrid Cloud ; Data centers.

Most of the European market is focused on colocation, hosting and low-end and high-end ...

4.2 Prices vary according to location

Data center prices vary widely, from €** per month for a basic dedicated server at OVH to several thousand euros per month. They differ from company to company and from country to country.

In addition, the price depends on the technical characteristics of the offer given to the end customer, which ...

4.3 Factors determining data center location

Real estate and physical considerations

Development pipeline The development of a potential data center depends on a number of factors, including sufficient electrical power, land accessibility, good financing possibilities, credible customers, and so on. In general, Singapore, London, Silicon Valley, Dublin and Northern Virginia are the best locations in this respect. Environmental ...

4.4 Operation and cost analysis

Analysis of operating costs

According to a **** report by the U.S. Chamber Technology Engagement Center (***), not least because of the IT equipment. In the typical data center considered in the report, the initial investment is around $*** million for a **,*** m² data center. Around **% of the investment is in hardware. The ...

4.5 The challenges facing data centers

The security challenge

Data has become a source of covetousness, and data centers need to respond to the security challenge and raise their level of protection against attacks. We are therefore seeing an increase in "Zero Trust" IT architectures to prevent anyone from connecting to the network, and homomorphic encryption that ...

5 Regulations

5.1 French and European regulatory framework

European and national legislation can influence the direction of data center market expansion in France. There are three main regulations to be complied with

Data protection laws (***); Energy efficiency and emission limits (***) ; Data center compliance with third-party standards (***)

a) Law n°**-** of **** on information technology, data files and freedoms (***) Decree ...

6 Positioning the players

6.1 Segmentation

  • OVH
  • Amazon Web Services
  • ILIAD
  • EQUINIX
  • Interxion
  • APL Data center
  • Jerlaure
  • Wattdesign
  • Adista
  • Etix Everywhere
  • Data4 service
  • Marseille, Hub digital
  • Altice
  • Celeste Telecom
  • Scaleway (Iliad Groupe)
  • Google Cloud
  • Microsoft Azure
  • Schwartz Group (Lidll Kaufland, Schwartz Digit)
  • Snowflake Computing
  • XEFI
  • NTT Nippon Telecom
  • Evernex
  • Green4Cloud

List of charts

  • Google data centers by continent
  • Size of the data center market
  • Data center investments by state
  • Number of data centers by country
  • Data centers in France
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Latest news

Gard-based start-up Green4Cloud launches two data centers - 29/03/2024
  • - Location of data centers: Vézénobres (Gard) and Saint-Aunès (Hérault).
  • - Number of data centers planned by 2025: 17.
  • - Current number of employees: 5.
Datacenters: Japanese telecom giant NTT builds a "campus" just outside Paris - 23/02/2024
  • NTT is one of the world's top three providers of data storage centers.
  • NTT has announced the construction of a "campus" of three data centers in the Essonne region of France.
  • NTT plans to invest more than $10 billion in data center growth between 2023 and 2027.
Lyon-based Xefi boosts its digital growth - 02/02/2024
  • - The company is investing 60 million euros in a new site in Rillieux-la-Pape, near Lyon.
  • - The company currently has 2,000 employees, but plans to increase this to 700 at the new site within 18 months.
  • - The future 17,500 m2 site will comprise four buildings, including offices for the 500 head office employees, a sixth 80-bay data center, a brasserie and a training center.
  • - The company has five data centers, two of which are HDS-certified (for healthcare data hosting).
  • - The company has sales of 355 million euros, with growth of 16% by 2023 and 100% by 2020.
  • - It has around 180 branches, including 160 in France, and serves 100,000 customers.
  • - Xefi is expanding in Europe, with branches in Belgium, Switzerland and Spain.
  • - The company plans to have 250 branches in France by 2026 and 400 in Europe, expanding into Italy, Germany and the Netherlands.
  • - One of the company's development processes is franchising, enabling proximity to customers.
  • - In December 2021, Xefi took over Novatim, a company based in Courbevoie, France
The five key axes of OVHcloud's strategic plan to 2026 - 20/01/2024
  • OVHcloud employs 2,900 people worldwide, including around 2,000 in France
  • 2023: sales of €897 million, with annual growth of 14%.
  • Public cloud accounts for 62% of sales
  • The public cloud market is estimated to be worth between 230 and 250 billion euros worldwide by 2023, compared with 16 to 19 billion euros for the private cloud.)
  • Development of PaaS (Platform as a service), increasing their number from 10 to 40
  • Public cloud accounts for 18% of sales
  • by the end of 2023, there will be 32 data centers worldwide; by the end of 2024, the figure should rise to 45, including 22 in France.
  • OVHcloud is tackling edge computing, which involves processing data as close as possible to where it is generated.It plans to open 150 local zones
Discount king Lidl becomes a cloud provider - 15/01/2024
  • Lidl's parent company, the Schwarz Group, aims to become a national cloud champion by targeting German SMEs
  • Creation of a European center for artificial intelligence In Heilbronn, southern Germany, the Schwarz Foundation is investing 2 billion euros.
  • A new campus designed to train 5,000 IT specialists by 2025 is being built just a few kilometers from Heilbronn.
  • The Schwarz Group intends to become a national cloud champion.
  • Under the name "Stackit", the IT branch of the Schwarz Group markets the cloud services originally created to manage the data of its own Lidl stores.
  • With its 20,000 servers serving 13,700 Lidl and Kaufland sites in some 30 countries, the Schwarz Group already provides Stackit with a solid foundation for the future
  • Acquisition of development specialist Camao IDC and Israeli start-up XM Cyber
  • the Schwarz Group invests €8 billion a year, out of sales of €154 billion, in "strategic and forward-looking projects, including digitization
  • Schwarz Digit employs 4,500 people

Data centers: Data4 strengthens its foothold in Essonne - 14/12/2023
  • Data4 has been based in Essonne for 17 years.
  • Its campus in Marcoussis (Essonne) comprises twenty data centers spread over 46,000 square meters.
  • The group is located on a 110-hectare site, 70 of which are classified as "protected forest".
  • within the next 5 years, Data4 plans to double the surface area of its park in the department to 100,000 m2.

Companies quoted in this study

This study contains a complete overview of the companies in the market, with the latest figures and news for each company. :

OVH
Amazon Web Services
ILIAD
EQUINIX
Interxion
APL Data center
Jerlaure
Wattdesign
Adista
Etix Everywhere
Data4 service
Marseille, Hub digital

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