Data Center Transformation Market size is expected to grow significantly during the forecast timeframe owing to the ongoing trend of cloud-based IT infrastructures. Several businesses are adopting cloud-based systems for enhanced flexibility and scalability. The growing penetration of digitalization has stressed IT organizations to transition the existing IT infrastructures to highly efficient cloud-based structures. As businesses expand, their IT requirements grow, posing challenges concerning the expansion of existing IT architectures. This has boosted the demand for data center transformation services that enable the seamless transition from traditional systems to cloud-based architectures.
The coronavirus pandemic had a negative impact on the data center transformation market growth in the first half of 2020. The temporary dip in the industry expansion was attributed to the stringent lockdowns imposed followed by the shutdown of industries. New data center construction projects were halted due to restrictions imposed on travel. However, with gradual relaxations in lockdowns in the second half of 2020, the market will regain traction. The resumption of industrial activities will fuel the market revenue in 2021.
Data center infrastructure management services will witness increasing demand led by the growing need for the efficient management of different components in a facility. Asset, network, security, and power & cooling equipment management are crucial for the efficient functioning of data centers. There is an increasing demand for software solutions for managing and monitoring different phases of data center facilities. Industrial sectors are installing these software technologies to monitor & control the performances and operability of their IT devices. The major factor driving the adoption of these services in the market is the rising need for predictive maintenance & management of the systems to reduce the system downtime and failure.
There will be high acceptance of data center transformation solutions from the tier 4 infrastructures due to their high complexity. As tier 4 data centers have the most complex and redundant components, there is a high demand for transformation services that enable to optimize their operations. As tier 4 data centers have multiple active power and cooling paths, these data centers have extremely complicated infrastructures. As upgrading and optimizing these infrastructures pose challenges to the operators, there will be a high demand for efficient IT transformation services. This will foster the market expansion.
The expanding IT & telecom infrastructure globally will augment the need for robust IT infrastructures that can handle the surging amounts of data. The increasing penetration of internet-enabled devices globally has resulted in the sharp rise in the amounts of data collected. The advent of 5G technology that ensures high data streaming speeds will further encourage more people to use digital services. This has encouraged IT & telecom service providers to adopt advanced technologies for the efficient storage and transfer of data. IT & telecom providers focusing on upgrading their existing data centers will propel the data center transformation market value.
The robust manufacturing industry in Europe, adopting advanced technologies to streamline operations, will spur the demand for high-quality IT infrastructures. As increasing number of manufacturers use technologies such as AI, machine learning, and IoT, there will be an upsurge in the demand for high-quality IT infrastructures for data traffic management. Automotive manufacturers in countries, such as Germany and France, use the latest digital technologies for production to streamline operations and maximize productivity. This will impel the need to upgrade existing data centers, in turn, influencing the market demand.
The players operating the market include IBM Corporation, Microsoft Corporation, Cisco Systems Inc., Schneider Electric SE, Accenture PLC, Dell Inc., Rahi Systems, HCL Technologies, Hitachi Ltd., and ABB Ltd. They are focusing on launching innovative solutions to expand their product portfolio and strengthen their market position.
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