From a trend perspective, there is consensus that data center capacity will continue to grow steadily on a global scale. This has happened for several years already and is expected to continue for the foreseeable future. However, while much of the growth to date has been characterized by the build-out of hyperscale cloud and colocation facilities, the years ahead will see an increasing importance of edge and micro edge locations. This is being driven by the growth of IoT, gaming, mobile 5G, content distribution, cloud services, autonomous vehicles, and a myriad of other applications that require closer proximity to the compute. There are several reasons for this: Network latency needs to be extremely short, network bandwidth can be very expensive, and network complexity could become a limiting factor. But all three can be overcome by increasing computing power at the edge.
This accelerating growth in the data center market will undoubtedly result in some significant challenges that will need to be handled carefully in order to secure a reliable and fully functioning global IT infrastructure. There will be challenges with human resources — finding enough qualified people to design, build, operate, and maintain all the required new data center facilities. There will be technical challenges requiring significant integration efforts between the buildings themselves and the systems to be installed within. There will be increasingly tough “green” challenges — especially around energy efficiency — which will trigger the emergence of new technologies and new ideas. And there will be volume challenges, with the deployment of large numbers of edge and micro edge data centers requiring a high level of standardization, coordination, and new capabilities in remote management.
The Future Landscape
In many respects, the landscape will be much as it is today — a mesh of data centers of all sizes: core hyperscale, regional large scale, local edge, and micro edge. Some data center owners will focus on just one of those segments, while others will operate a network of data centers covering several or all of these groups. Where I see significant change coming, though, is in the micro edge arena. Business cases for the micro edge approach are currently being tested, and it remains to be seen how this market segment will ultimately shape up. But it is clear the level of investment that will go into the edge and micro edge segments will be significant. And we will see a very tight integration between communication services and IT applications in the micro edge area, with mobile 5G playing a major role.
Asset Expansion by Region
I see no single region overshadowing the rest in terms of growth in required data center capacity, although there will, of course, be regional differences. The hyperscale build-out that we have typically seen in the world’s developed economies will undoubtedly continue. Meanwhile, emerging economies will require smaller facilities, but there will be many more of them, and they will still be significant in size for those locations. And I expect to see huge growth in the deployment of micro edge data centers worldwide, driven in part by the rollout of new 5G networks. I also believe the coming years will see a lot of nontraditional entrepreneurial initiatives, with new players shaking up the data center landscape. We live in exciting times!
Demand and Capacity
There is no doubt in my mind that the only way to roll out the new data center capacity that the world is going to need will be through a combination of customization, standardization, and prefabrication. In other words, creating standard designs that are fit for prefabrication, customizing them, and then producing them in dedicated manufacturing facilities in order to secure the highest possible quality standards and repeatability with the lowest possible project risk.