India data center market to be worth $1.5 billion by 2022: Report

According to a new market research published by MarketsandMarkets, the India Data Center Market size is projected to reach USD 1.5 billion by 2022 from USD 1.0 billion in 2018, growing at a CAGR of 11.4 percent during the forecast period. The market growth is driven deeper internet penetration, increase in digital data traffic, public cloud services, and higher expected growth for IoT.

The captive model of data center is being overtaken by colocation model at a significant rate. It is expected that consolidation of data centers will cannibalize the captive data center market, and colocation market will grow exponentially keeping in view that the outsourcing of data centers will help reduce the operating cost significantly for the clients.

By 2022, the outsourced model of data centers will make almost equal market share. The captive model, however, will still hold a majority of share, due to strict government regulations for various industry verticals making them to spend on captive data centers to localize their data processing.

Mumbai is the prime focus of data center developers in India with more than 20 percent of market share, followed by Bengaluru. All government-owned companies in every industry vertical have their data centers located in Mumbai and Bengaluru.

Indian government has launched MeghRaj cloud to accelerate G2C services delivery. Under the scheme, many national data centers and state data centers have been built and many are being built in various states, such as Maharashtra and Madhya Pradesh. For example, NIC has already built 4 NDCs in India and the fifth one is coming up in Bhopal.

eCommerce and online marketplace proliferation in India has driven the market for colocation data centers in India and is expected to drive the market in the coming years as well. Higher adoption of technology by SMEs in every sector combined with stringent government regulations will spur the demand for more data centers in India.