by The data center networking market facilitates the seamless flow of data, communication and connectivity within large information technology infrastructures. It includes networking equipment such as routers, switches and storage area network (SAN) that enables enterprises to facilitate storage, transmission and management of large amounts of data. The global data center transformation trends involving virtualization, cloud computing and hyper-converged infrastructure has significantly increased the complexity of data centers and driven the demand for robust and scalable networking solutions.
Global Data Center Networking market is estimated to be valued at US$ 50.7 Bn by 2030.
The growing adoption of hyper-converged infrastructure and hybrid cloud computing models has accelerated the pace of Data Center Networking Market Demand. This has compelled organizations to invest heavily in upgrading their legacy networking infrastructure to software-defined networks and automation solutions. Additionally, the surge in big data analytics, IoT and 5G networks is generating massive volumes of data traffic that needs to be transported and managed efficiently within data centers.
Key Takeaways
Key players operating in the data center networking market are Cisco Systems, Arista Networks, Juniper Networks, HPE, Dell EMC and Huawei. These players have established leading market presence with proprietary networking switches, routers and software-defined networking technologies.
The growing demand for robust data management acrosssectors such as banking, healthcare and e-commerce is driving significant traffic within data centers. This has necessitated the deployment of high-performance networking infrastructure for low latency and reliable connectivity. Additionally, the COVID-19 pandemic has further accelerated digital transformation trends and the migration of workloads to cloud platforms. This is fueling the need for network upgrades to support the surge in demand for cloud and connectivity services.
Major data center operators are extensively investing in global expansion to strengthen their presence across emerging markets. For example, many hyperscale cloud providers have announced plans to establish presence in the Asia Pacific and Middle East regions through new data center builds. This is providing impetus to cross-regional networking infrastructure procurement.
Market Key Trends
One of the key trends transforming the data center networking market is the rise of hyper-converged infrastructure and composable disaggregated infrastructure approaches. The ability of hyper-converged integrated systems to consolidate servers, storage, networking and virtualization onto industry-standard high volume commodity hardware has fueled their adoption. Many data center operators are deploying hyper-converged systems within their modernized infrastructure to reduce costs and complexity. This is driving strong growth of integrated networking solutions that can seamlessly interconnect nodes within hyper-converged clusters. Additionally, the emergence of composable infrastructure is leading to demand for intelligent and automated networking products that deliver virtual networking topologies on demand.
Porter’s Analysis
Threat of new entrants: The data center networking market requires huge upfront costs for R&D and brand building. Existing players have established relationships with customers making entry difficult.
Bargaining power of buyers: Large buyers in the data center networking market such as cloud providers have significant bargaining power to negotiate on price and delivery terms due to bulk purchases.
Bargaining power of suppliers: Leading suppliers such as Cisco, Juniper etc have technological expertise and scale of operations giving them bargaining power over components manufacturers.
Threat of new substitutes: Though ethernet switches are new substitutes, data center networking solutions offer scalability, high bandwidth and capacities making substitution difficult in the long run.
Competitive rivalry: The market is dominated by few large players leading to intense competition on product innovation, pricing and customer service.
Geographical Regions
North America region accounted for the major share in the global data center networking market in terms value owing to heavy investments in digital infrastructure by cloud companies in the US.
The Asia Pacific region is expected to grow at the fastest pace during the forecast period due to rising demand from cloud providers expanding their presence and hyperscale data center build outs in countries like India and China driven by strong economic growth and government push for digital transformation.
*Note:
1. Source: Coherent Market Insights, Public Source, Desk Research
2. We have leveraged AI tools to mine information and compile it.
About Author - Ravina Pandya
Ravina Pandya,a content writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemicals and materials, etc. With an MBA in E-commerce, she has expertise in SEO-optimized content that resonates with industry professionals. LinkedIn Profile
