South Africa dominated the Africa market in 2020, in terms of area, investments, and power capacity, followed by Kenya. Morocco, Nigeria, and Egypt are emerging markets in Africa.
Increasing internet penetration, adoption of cloud, and migration from on-premises to colocation and managed data centers is driving the data center demand in Africa.
The rate of urbanization in Africa is expected to go up to aroundd 60% in 2050, with more than 10 mega cities comprising over 150 million residents, and accounting for over 15% share of the global GDP.
The International Renewable Energy Agency (IRENA) has introduced initiatives to boost renewable power generation across Africa, such as the Africa Clean Energy Corridor, West Africa Clean Energy Corridor, Entrepreneurship Support Facility in Western and Southern Africa, and Renewables Readiness Assessment.
Smart cities are being built across Africa, including South Africa, Kenya, Morocco, and Nigeria, leading to increased network connectivity and data generation, and benefitting the data center industry.
Smart Africa, an alliance between 29 African heads of state and the government, aims to accelerate sustainable socio-economic development, through affordable internet access and the use of Information & Communication Technology (ICT).
Market Size & Forecast by Revenue | 2020−2026
Market Dynamics – Leading trends, growth drivers, restraints, and investment opportunities
Market Segmentation – A detailed analysis by IT infrastructure, electrical infrastructure, mechanical infrastructure, cooling technique, cooling systems, general construction, tier standards, and geography
Competitive Landscape – 10 IT infrastructure providers, 11 support infrastructure providers, 6 construction contractors, and 14 data center investors.
The Africa IT infrastructure market expects to reach approx. USD 4 billion by 2026. The growth in data generation in Africa is fueling the demand for fast-processing efficient servers. The demand for build-to-suit infrastructure is growing to support specific applications. Several segments such as BFSI, healthcare, transportation and logistics, education, and heavy industries adopt advanced server systems for efficient services.
The unreliable power grid connectivity increases the demand for power backup sources. UPS and generator systems are expected to grow due to the increased construction of large and mega data center facilities. The Kenya data center market has witnessed the installation of energy-efficient power infrastructure. Most facilities are of Tier III standards and are adopting power redundancy of N+1 or 2N to manage power grid instability.
Data center facilities operating in the African region mainly adopt chillers and precision air cooling. The adoption of air-based cooling (free cooling chillers) is likely to gain traction as certain African countries experience cold winter seasons. South Africa is likely to adopt free cooling chillers or evaporative coolers.
Africa Data Center Market by IT Infrastructure
Africa Data Center Market by Electrical Infrastructure
Transfer Switches and Switchgears
Other Electrical Infrastructures
Africa Data Center Market by Mechanical Infrastructure
CRAC & CRAH Units
Cooling Towers, Dry Coolers, & Condensers
Other Cooling Units
Others Mechanical Infrastructure
Africa Data Center Market by Cooling Technique
Air-based Cooling Technique
Liquid-based Cooling Technique
Africa Data Center Market by General Construction
Core and Shell Development
Installation and Commissioning Services
Engineering and Building Designs
Africa Data Center Market by Tier Standards
Tier I & II
Africa Data Center Market – Dynamics
The Africa data center market is increasingly moving towards digitization, with the rising adoption of the internet, the implementation of 5G services by a few telecom companies in Tier I cities, as well as improvement in overall connectivity in the region by way of terrestrial and subsea cables. The number of interconnected devices is also increasing significantly in recent years. By 2050, Africa will have 10 mega cities with over 150 million residents. These mega cities are expected to account for over 15% share of the global GDP. The rate of urbanization in Africa is expected to go up to 60% in 2050. This pace of urbanization will power the economy in the region and attract investments for technological advancements. Government-funded public administration initiatives are paving the way to the adoption of the Internet of Things (IoT) networks and related edge networks, 5G, and analytics applications in Africa. Smart city initiatives further emphasize the importance of data in improving communication among cities, citizens, automobiles, electronics, and devices.
Key Drivers and Trends fueling Market Growth:
Government Support to Boost Digital Economy
Rising Adoption of All-Flash Storage Solutions
Big Data & IoT on Data Center Growth
Migration from On-Premises Infrastructure to Colocation & Managed Services
Africa Data Center Market – Geography
South Africa is witnessing increased adoption of cloud-based solutions among enterprises and is rapidly emerging as a center for public and private cloud hosting, which will encourage more data center developments in the country. Cape Town and Johannesburg are the major preferred locations for data center development. For instance, AWS, a leading cloud service provider, has opened a cloud presence in Cape Town. This will help enterprises to gain faster access to their cloud service offerings at a cheaper rate in South Africa. The manufacturing, financial services, and healthcare sectors are among the major contributors to data center investments as these sectors are rapidly adopting cloud computing. The South African data center market is also increasingly adopting cloud technology. In September 2019, the data-only operator Rain, in partnership with Huawei, launched 5G network operations in South Africa. Vodacom and MTN have also launched commercial 5G services in the Tier I cities in South Africa, which will further increase the need for data storage, thereby increasing the requirement for additional data centers.
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