Data Center Network Infrastructure Market Overview
Data Center Network Infrastructure Market Size was estimated at 20.34 (USD Billion) in 2022. The Data Center Network Infrastructure Market Industry is expected to grow from 21.29 (USD Billion) in 2023 to 32.09 (USD Billion) by 2032. The Data Center Network Infrastructure Market CAGR (growth rate) is expected to be around 4.66% during the forecast period (2024 - 2032).
Key Data Center Network Infrastructure Market Trends Highlighted
Cloud computing adoption, artificial intelligence (AI), machine learning (ML), and the Internet of Things (IoT) are accelerating data generation and driving the need for efficient data center network infrastructure. Real-time data processing and analysis demand high-speed, low-latency networks to support digital transformation and emerging applications. The demand for scalable, agile, and secure infrastructure is rising, especially in sectors like e-commerce, cloud gaming, and video streaming. Edge computing and 5G networks are driving the expansion of data centers at the edge, creating opportunities for specialized network infrastructure solutions. Additionally, data privacy and regulatory compliance concerns are shaping market trends, with organizations seeking robust and compliant network infrastructures.
Figure 1: Data Center Network Infrastructure Market Size, 2024-2032 (USD Billion)
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Data Center Network Infrastructure Market Drivers
Cloud Computing Adoption
The significant driver of the Data Center Network Infrastructure Market Industry is the increased adoption of cloud computing. Accompanied by more businesses shifting their applications and data to the cloud are the required investments in network infrastructure that would provide sufficient capacity and reliability to support cloud-based operations. The demand for high-speed, low-latency networks that would facilitate efficient connections between data centers and the cloud is on the rise, and this demand is unlikely to decrease in the foreseeable future as more businesses adopt cloud computing to benefit from increased agility, efficiency and lower costs.
Big Data and Analytics
Another driving factor for the Data Center Network Infrastructure Market Industry is the increasing adoption of big data and analytics applications. With the rise of these applications comes more and more data that needs processing, analyzing and storing. All of these tasks require a high-performance network infrastructure that can facilitate the transfer and processing of large datasets. Since data analytics prove to be useful across a variety of industries, including healthcare, finance, and retail, the demand for data center network infrastructure solutions will increase even more.
Artificial Intelligence (AI) and Machine Learning (ML)
Moreover, the development of AI and ML technologies also encourages the growth of the infrastructure of data center networks. This is due to the reason that AI and ML algorithms are based on the principles of pattern recognition and prediction, and, therefore, they need vast amounts of data to be trained and reach accurate results when making inferences. In the scope of these operations, the networks should work at considerable speeds with low latencies to be beneficial and relevant to the goals of the specialists.As a result, the growing use of technologies in such fields as natural language processing, image recognition, and predictive analytics leads to the rising popularity of different infrastructure solutions for data centers and networks able to support AI and ML operations.
Data Center Network Infrastructure Market Segment Insights
Data Center Network Infrastructure Market Component Type Insights
The Data Center Network Infrastructure Market is segmented by component type, including switches, routers, load balancers, firewalls and controllers. Among these types of components, switches constituted more than 35% of the Data Center Network Infrastructure Market in 2023 and are expected to dominate this market in the future. This is because data centers of the future require wiring and connectivity that is both faster and more sophisticated. While routers accounted for less of the market, they are expected to increase in impact in the near future as cloud and virtualization technology becomes more popular.
Similarly, while load balancers may constitute a small portion of the market because they do not connect to switches or routers, they will become more popular as data centers become more sophisticated. This is because load balancers distribute the work put on several servers to ensure that “applications work and data gets where it is supposed to be.” The demand for firewalls will not change as data centers continue to need protection from outside hackers, though they will not constitute more than 10% of the Data Center Network Infrastructure Market by 2032.
Controllers, however, will become increasingly useful as data centers “continue to get larger and more unwieldy” and require a way to effectively control and understand their infrastructure. The Data Center Network Infrastructure Market is expected to reach a valuation of USD 32.09 billion by 2032.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Data Center Network Infrastructure Market Network Type Insights
Out of the given types of networks, such as Ethernet, InfiniBand, Fiber Channel and Converged Fabric, the leading one in the Data Center Network Infrastructure Market is Ethernet, which is also anticipated to lead throughout the forecast period. The steady growth of its adoption is determined by its cost efficiency, easy deployment and operation, massive scalability, and – as a result – its wide usage within the majority of data centers. Another type of network that is quite widely used is InfiniBand. It is mainly utilized in high-performance computing applications, such as simulations, scientific research, and big data processing and mining.
It is particularly employed there since this type of network offers low latency and is characterized by the highest bandwidth among the technologies mentioned. Fiber Channel is a rather old type of network that is also used within modern data centers. It has matured over the years and is currently used most extensively within the networking of storage systems. Although it is the most reliable and fast option, it also has the drawback of being quite expensive. Still, its cost is lower than that of InfiniBand, making it a more attractive option when InfiniBand is not required due to its high speed.
Finally, Converged Fabric is a relatively new and innovative solution that is gradually emerging within the market. Unique in its combination of all aforementioned types of networks, it allows data centers to benefit from its high efficiency due to the consolidation of all types of network devices and equipment into a single network.
Data Center Network Infrastructure Market Deployment Type Insights
The Data Center Network Infrastructure Market is segmented by deployment type into on-premises, colocation, managed services, and cloud. On-premises deployments are the most common type, accounting for over half of the market revenue in 2023. On-premises deployments offer businesses greater control over their data and security, but they can also be more expensive and complex to manage. Colocation deployments are growing in popularity as they offer businesses a cost-effective way to deploy their IT infrastructure in a secure and reliable environment.
Colocation providers offer a variety of services, including rack space, power, cooling, and network connectivity. Managed services deployments are another growing segment of the market. Managed services providers offer businesses a complete solution for managing their data center network infrastructure, including hardware, software and support. Cloud deployments are becoming increasingly popular as they offer businesses a scalable and cost-effective way to deploy their IT infrastructure. This growth will be driven by the increasing adoption of cloud and colocation deployments.
Data Center Network Infrastructure Market Networking Protocol Insights
The Networking Protocol segment of the Data Center Network Infrastructure Market is anticipated to experience significant growth in the coming years, driven by the increasing adoption of cloud computing, big data analytics, and the Internet of Things (IoT). The market is segmented into various protocols, including TCP/IP, UDP, ICMP, HTTP, and HTTPS. TCP/IP, a widely used protocol for data transmission, is expected to hold the largest market share due to its reliability and efficiency in establishing connections between devices. UDP, a connectionless protocol, is gaining popularity in applications requiring low latency and high throughput, such as online gaming and video streaming.
ICMP, a protocol used for network diagnostics and error reporting, is expected to witness steady growth due to its importance in network management and troubleshooting. HTTP, the protocol used for web browsing, is projected to continue its dominance in the market, driven by the increasing adoption of e-commerce and online services. HTTPS, a secure version of HTTP, is expected to gain traction due to growing concerns over data privacy and security.
Data Center Network Infrastructure Market Data Rate Insights
The Data Rate segment is a crucial aspect of the Data Center Network Infrastructure Market segmentation. It categorizes the market based on the data transmission rates supported by network infrastructure components. Key data rates considered in this segment include 10G, 25G, 40G, 100G, 200G, and 400 G. As of 2023, the 10G data rate dominated the market, capturing a significant share. However, the demand for higher bandwidth and data-intensive applications is driving growth in the adoption of faster data rates. The 25G, 40G, and 100G data rates are expected to witness substantial growth in the coming years.
Moreover, the emergence of technologies such as AI, machine learning, and cloud computing is fueling the need for even higher data rates, making 200G and 400G solutions increasingly relevant in the market. The Data Center Network Infrastructure Market revenue is projected to grow significantly in the coming years, driven by the increasing adoption of higher data rates. The market growth is expected to be influenced by factors such as the rising demand for data center infrastructure, the proliferation of cloud services, and the growing adoption of bandwidth-intensive applications.
Data Center Network Infrastructure Market Regional Insights
Regionally, the market is segmented into North America, Europe, APAC, South America and MEA. North America is the largest regional market, accounting for over 6.034 billion USD of global revenue in 2023. The region's growth is attributed to the presence of major data center providers, such as Equinix, Digital Realty, and CyrusOne, as well as the increasing adoption of cloud and edge computing services. Europe is the second-largest regional market, with a significant presence of data centers in countries such as Germany, the United Kingdom, and France, accounting for over 6.617 billion USD in 2023. The region is experiencing growth due to the rising demand for data storage and processing capabilities to support the growing digital economy.
APAC is the fastest-growing regional market, with countries such as China, India, and Japan witnessing a surge in data center investments, accounting for over 6.924 billion USD in 2023. The region's growth is driven by the increasing demand for data center services from various industries, including IT, telecom, and healthcare. South America and MEA are relatively smaller regional markets, with South America accounting for 0.857 billion USD in 2023 and MEA for 0.857 billion USD. However, they are expected to witness steady growth in the coming years. The increasing adoption of digital technologies and the rising demand for data storage and processing capabilities are driving growth in these regions.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Data Center Network Infrastructure Market Key Players And Competitive Insights
Leading players in such a dynamic market as the Data Center Network Infrastructure Market are constantly developing innovative solutions to keep up with the demands of data centers. Thus, the leading players in this market are Cisco and Juniper Networks which offer a wide range of products, including switches, routers, and software for management. High-performance, energy-efficient, and scalable solutions are the ones that the major market leaders are currently focusing on. Arista Networks, Brocade Communications Systems, Dell Technologies, and Huawei Technologies are the other significant players in the market who are seeking to expand their market share by investing in new product development. Data Center Network Infrastructure Market will remain highly competitive, offering a number of opportunities for acquisition, partnership, and product innovation to the major and minor players.
The major players in the market are investing heavily in research and development to ensure that they remain the key players and the driving force behind the market’s growth. For instance, Cisco, a major player in this market, has recently introduced a new line of switches that are able to match the needs of cloud and hyperscale data centers. Juniper Networks, in turn, has recently made an investment in the development of software-defined networking solutions that would allow the company to offer its customers an unprecedented level of flexibility and control over their data center networks. All in all, the companies in the market are making significant investments to stimulate the growth of the Data Center Network Infrastructure Market.
Moreover, the competitors in the market are also focusing on the different value-adding services. Most players on the market are now offering consulting, design, and implementation services to their customers in order to help them reduce the operational costs of their data centers. The managed services that these companies are offering to their customers are also gaining popularity as a way of ensuring that the data center network is constantly serviced and the issues are always addressed. The Data Center Network Infrastructure Market will continue to grow in the future as an increasing number of companies are beginning the transition toward cloud computing, big data, and artificial intelligence.
Key Companies in the Data Center Network Infrastructure Market Include
Data Center Network Infrastructure Market Industry Developments
Recent advancements in artificial intelligence (AI), cloud computing, and big data analytics are driving the growth of the data center network infrastructure market. The increasing adoption of these technologies by enterprises across various industries is leading to a surge in demand for high-performance and reliable data center networks. One of the key trends in the market is the growing adoption of software-defined networking (SDN) and network function virtualization (NFV). These technologies enable enterprises to manage their data center networks more efficiently and flexibly. SDN and NFV also allow enterprises to automate network operations, which can lead to significant cost savings.
Another major trend in the market is the increasing adoption of cloud-based data center infrastructure. Cloud-based data centers offer enterprises a number of advantages, including scalability, flexibility, and cost-effectiveness. Enterprises are increasingly moving their data center operations to the cloud in order to take advantage of these benefits.The Data Center Network Infrastructure Market is expected to grow from $21.29 billion in 2023 to $32.09 billion by 2032, at a CAGR of 4.66%. North America is expected to remain the largest market, followed by Europe and Asia-Pacific.
Data Center Network Infrastructure Market Segmentation Insights
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Data Center Network Infrastructure Market Component Type Outlook
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Switches
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Routers
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Load Balancers
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Firewalls
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Controllers
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Data Center Network Infrastructure Market Network Type Outlook
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Ethernet
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InfiniBand
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Fibre Channel
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Converged Fabric
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Data Center Network Infrastructure Market Deployment Type Outlook
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On-premises
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Colocation
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Managed Services
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Cloud
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Data Center Network Infrastructure Market Networking Protocol Outlook
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TCP/IP
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UDP
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ICMP
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HTTP
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HTTPS
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Data Center Network Infrastructure Market Data Rate Outlook
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10G
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25G
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40G
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100G
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200G
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400G
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Data Center Network Infrastructure Market Regional Outlook
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North America
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Europe
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South America
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Asia Pacific
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Middle East and Africa
| Report Attribute/Metric |
Details |
| Market Size 2022 |
20.34(USD Billion) |
| Market Size 2023 |
21.29(USD Billion) |
| Market Size 2032 |
32.09(USD Billion) |
| Compound Annual Growth Rate (CAGR) |
4.66% (2024 - 2032) |
| Report Coverage |
Revenue Forecast, Competitive Landscape, Growth Factors, and Trends |
| Base Year |
2023 |
| Market Forecast Period |
2024 - 2032 |
| Historical Data |
2019 - 2023 |
| Market Forecast Units |
USD Billion |
| Key Companies Profiled |
Intel Corporation, Hewlett Packard Enterprise, Huawei Technologies, Mellanox Technologies, Juniper Networks, F5 Networks, Netgear, Extreme Networks, Brocade Communications Systems, Dell Technologies, Cisco Systems, Ciena Corporation, Arista Networks, Marvell Technology Group, VMware |
| Segments Covered |
Component Type, Network Type, Deployment Type, Networking Protocol, Data Rate, Regional |
| Key Market Opportunities |
Artificial Intelligence integration Highspeed computing demand Edge computing Increased data traffic 5G network expansion |
| Key Market Dynamics |
Rapid Adoption of Cloud Computing Growing Demand for AI and ML IoT Proliferation Edge Computing Deployment |
| Countries Covered |
North America, Europe, APAC, South America, MEA |
Frequently Asked Questions (FAQ) :
The Data Center Network Infrastructure Market was expected to reach USD 21.29 billion in 2023.
The Data Center Network Infrastructure Market is expected to grow at a CAGR of 4.66% from 2024 to 2032.
North America is expected to hold the largest market share in the Data Center Network Infrastructure Market in 2023.
The enterprise segment is expected to hold the largest market share in the Data Center Network Infrastructure Market in 2023.
Key competitors in the Data Center Network Infrastructure Market include Cisco, Juniper Networks, Huawei, Arista Networks and Dell Technologies.
Key growth drivers of the Data Center Network Infrastructure Market include the increasing adoption of cloud computing, the growing need for data storage and processing, and the rising demand for high-performance computing.
Challenges faced by the Data Center Network Infrastructure Market include the high cost of deployment, the complexity of managing and maintaining data center networks, and the need for skilled professionals.
Opportunities for the Data Center Network Infrastructure Market include the growing demand for data center services, the increasing adoption of emerging technologies, and the expanding presence of data centers in emerging markets.
Key trends in the Data Center Network Infrastructure Market include the adoption of software-defined networking (SDN), the convergence of data center and telecommunications networks, and the increasing use of artificial intelligence (AI) and machine learning (ML) for network management.
The Data Center Network Infrastructure Market is expected to reach USD 32.09 billion by 2032.
