Global Prefabricated Modular Data Center Market Growth – Shaping the Future of Digital Economy

Since the emergence of the internet, telecommunication has been one of the key determinants facilitating global development and value creation. During the past few years, there has been a myriad of developments in the telecommunications industry, which are undoubtedly ascribed to the plethora of technology progressions. The rate at which this fastest-growing sector has can be reflected by the findings published in the recent report by The Telecommunication Development Sector (ITU-D). Thus, looking at 2020, approximately 85% of the global populations are anticipated to have access to the 4G network as 2020 concludes according to the recent report published by The Telecommunication Development Sector (ITU-D). Further, it also brings to the fore the following facts. Despite the annual growth has been experiencing a sort of deceleration since 2017 and the coverage registered during 2020 is increased by a mere 1.3 % points from that of 2019, 4G network coverage has been reported to double between 2015 and 2020.

Further, currently, 93% of the global population has mobile-broadband network access which is a slight increase from that of preceding years (less than ½ % point). Also, more than 90% of the global population has 3G and above mobile-broadband network access in most of the regions. The aforesaid is suggestive of several developments. First, it’s a clear indication that the telecom providers have upped their game are willing to walk the extra mile to remain competitive and increase their share in the telecom market. Thus, to optimize their networks and the operational digital services which are executed on these networks are anticipated to need more computational and storage capabilities to be deployed across carrier networks. Moreover, the growing  4G penetration and the upcoming 5G wave are anticipated to incentivize telecom vendors to invest in the prefabricated modular data center market for more cost-effective network functionality and a relatively greater ability to manage networks around the edges due to high data traffic.

Mobile Cellular Subscriptions (per 100 People)

Source: World Bank

The telecommunication sector is anticipated to occupy a substantial share in the global prefabricated modular data center market

In 2019 approx. 72% of urban households around the world had access to the internet in their residence which almost 38% more than those residing in rural areas. In developed countries, the urban-rural gap was relatively small. By the end of 2019, a little over half of the global population was using the internet, however, when it comes to the age group of 15 to 24 years, 69% of the total population was using the internet. Further, in developed economies, almost all young individual was using the internet. Further, in 2019 it was estimated that 55% of the global male population was using the internet in comparison to 48% of the global female population. Additionally, the number of active mobile-broadband subscriptions was estimated to be about 75 per 100 residents in 2020. After a significant growth registered during 2019, this figure was an increase by 1.1 % as compared to that of 2019. Nevertheless, growth in fixed broad brand subscription decelerated by 2.7% in 2020. While the Americas and Europe occupied the topmost position mobile-broadband subscription, the CIS region registered the highest number of mobile-cellular subscriptions in 2020. Besides, concerning the APAC region, it had the highest youth/overall ratio which implies that there is a possibility of elder age groups to get up to speed with the younger ones in their internet use. Thus, such a promising potential makes it a business imperative for the telecom players to streamline their data management capabilities with mobility and scalability which this kind of data centers extend, enabling them the ease of adjusting to the fluctuating demands as well as add capacity to their offerings promptly.

Impact of COVID 19 pandemic has been instrumental in facilitating the growth of the digital economy, hence assist in reinforcing the market growth

The advent of COVID 19 has practically amended global economic growth forecasts. From a considerable decrease in consumers’ discretionary spending to immobilization of business activities that encompass capital budgets and hiring, every element of lives being influenced by this outbreak. But in the case of the ICT industry, the advent of COVID 19 has been a blessing in disguise to a certain extent, because it has emerged critical to our lives and is anticipated to experience demand growing at unprecedented proportions. The primary reason is that during such pressing times, digital technologies have emerged as the key enabler of connectivity facilitating continuity of our regular lives and sustaining the link between people more than ever before. With the global population being subjected to the complete lockdown, especially during the first quarter of 2020, the internet and means of connecting to it (Viz. computers and other hand-held devices) have become a lifeline for individuals to carry their activities remotely which was earlier conducted in-person.

Even after sustainable solutions to the malady (Viz. vaccines) are commercially made available, certain activities like telemedicine, telecommute to work, remote learning and entertainment, online and contactless payments, food delivery and logistics, among others which have been monikered as new normal is anticipated to continue and increasingly adopted. Complementarily, as per ITU-D, during COVID 19 the global usage of international bandwidth increased by 38% which surpassed the growth rate registered during 2019 by 6%. Moreover, the international bandwidth usage growth in developing countries exceeded that of developed countries.  Therefore, due to the societal shift to online services during the COVID-19 pandemic the criticalness of reliable digital infrastructure to carry out our lives has been realized more than ever. Further with the digital economy of countries like those which are transitioning to a developed market economy like that of India, it is estimated to grow from $ 200 billion in 2017-18 to a remarkable $ 1 trillion by 2025, according to The Ministry of Electronics and Information Technology of the Indian government necessitates the setting up of robust data center infrastructure. This need has according to the ministry opened up a potential for investments of the order of USD 4.9 billion by 2025.