Data center market India forecast

Data center markets in India
The cloud computing-as-a-service market will grow at a CAGR of 25 percent over the next four years as digital transformation takes hold in India and more businesses start outsourcing their IT infrastructure.

The cloud computing market in India — comprising IaaS, PaaS and ISaaS — will reach $1.02 billion revenue by 2021 according to 451 Research Market Monitor.

Hyperscale cloud and IT services providers looking to reach India’s potential market of customers are further driving demand for multi-tenant datacenter capacity in the country.

84 percent of India’s datacenter supply is concentrated in five markets: Mumbai, Chennai, New Delhi, Bangalore and Pune.

Almost one-third of all built-out footprint in the country is located in Mumbai, due to the critical role the city plays in Asia-Pacific’s financial services industry, its large population and multiple international subsea cable landings.

“Most datacenter investment is focused on these five cities, reflecting India’s booming economic growth in dense urban areas,” said Teddy Miller, associate analyst at 451 Research and the report’s author.

Most providers already offer a range of managed services, and many have even launched their own public and private cloud platforms. Local companies such as Netmagic Solutions, NxtGen, Reliance Communications and Sify Technologies have resulted in partnerships and acquisitions involving global players including ST Telemedia and NTT Communications.

Providers in Mumbai are adding space to satisfy the requirements of global hyperscalers that are moving their operations closer to the city’s 21 million residents.

451 Research expects this demand from hyperscale cloud services providers to result in another year of solid growth in 2018, even with intensifying competition and rising land and power costs.

The colocation market in New Delhi has benefited from the government’s e-commerce initiatives. The city had continually maintained a modest growth rate until earlier this year, when a new large-scale datacenter came online in the business-centric Noida area.

Providers should keep a watchful eye on demand before making any further local investment. With Bangalore’s emergence in recent years as a centrally located, relatively disaster-free IT services hub, its datacenter industry has flourished.