Market Trends of Asia Pacific Structured Cabling Industry
This section covers the major market trends shaping the Asia Pacific Structured Cabling Market according to our research experts:
Data Centers to Hold Significant Market Share
- As the data center is a crucial facility that organizations use to house servers, critical applications, and data, they are usually designed based on a computing and storage resources network that facilitates the delivery of shared data and applications. The growth of the various commercial and industrial sectors and the increasing demand for automation and other digital technologies are driving the need for data centers in the Asia Pacific region.
- Like other regions, fiber-structured cabling networks are becoming more popular among businesses in the Asia Pacific region, primarily due to the high bandwidth, long-term cost benefit, and easy scalability. As structured cabling offers an organized and highly efficient physical infrastructure for various components, such as connectivity hardware and patch panels, the increasing demand for data centers in the Asia Pacific region will drive the market during the forecast period.
- According to cloud scene, as of January 2022, there were about 443 data centers in China, 207 in Japan, and 138 in India. This number is expected to grow significantly, considering the growing adoption of digital technologies across the region.
- To address the growing demand, investments are being made both by local as well as global players to establish new data centers in the region. For instance, in January 2022, Singapore-based CapitaLand announced an investment of about INR 11,000 crore (~USD 1.5-2 billion) over the next 5-6 years in India, with plans to expand into all 5-6 significant metros in the country. Furthermore, traditional real estates players such as Hiranandani and Adani have also invested heavily to establish new data centers, driving the growth of the data center market and creating opportunities for the development of the studied market.
- Similarly, Tencent Cloud launched its first data center in Jakarta's central business district in 2021. The data center boasts two utility power lines and 2N redundant transformers, which can support up to 72 hours at full load. These factors are driving the demand for structured cabling in data centers.
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India to Witness Significant Growth
- The trend of data center convergence, the growing demand for high-speed connectivity devices, and the ever-developing robust IT and communication infrastructure are driving the demand for structured cabling in India. According to Nxtra by Airtel, Mumbai had the power load for the data center industry with 45% of India's total 499 MW inventory. It was followed by Pune, Bengaluru, and Chennai with an equal share of 12% each.
- Fast emerging as the global hub for IT services outsourcing, owing to the presence of some of the largest IT companies, including TCS, Wipro, Infosys, etc., the demand for networking solutions and data centers is growing significantly in the country. According to IBEF, India's IT and BPM industry is expected to reach USD 19.93 billion by 2025, from USD 6.96 in H1, 2021.
- Additionally, the increasing emphasis of the Indian government to digitize the local economy to compete with developed countries places the Indian market among the most favorable ones for the growth of the studied market. For instance, in November 2022, Blackstone Group, a global asset management firm, forayed into the data center business in Asia with a planned capacity of 600 MW across two large hyperscale data centers in India.
- Furthermore, the increasing investment in developing the optical fiber network to boost connectivity across the country also creates potential growth opportunities in the studied market. For instance, in July 2022, STL bagged a high-performance communication network deployment project worth about INR 250 crore (USD 0.03 billion) to deploy optical fiber network in nine circles for a telecom player. The essential fiberized network is expected to form the foundation for many next-generation services, such as 5G, FTTH (fiber to the home), IoT, enterprise networks, and Industry 4.0.
- Many such projects are currently underway in the country. For instance, according to the government of India, the upcoming Delhi-Mumbai Expressway and Hyderabad-Bengaluru Expressway will be the first projects in the country to be enabled with an optical fiber cable network as part of India's National Broadband Mission (NBM). These developments by the various governments are driving the demand for the structured cabling market.
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