Data Processing And Hosting Services Market Size and Share
Data Processing And Hosting Services Market Analysis by Mordor Intelligence
The Data Processing And Hosting Services Market size is estimated at USD 118.83 billion in 2025, and is expected to reach USD 195.55 billion by 2030, at a CAGR of 10.48% during the forecast period (2025-2030).
Expansion is propelled by large-scale enterprise migrations to managed compute, an accelerating shift toward AI-ready infrastructure, and unrelenting hyperscale capital expenditure. Enterprises are diverting budgets from refreshed on-prem racks to GPU-dense cloud instances, turnkey colocation suites, and regional edge nodes that compress data-to-insight cycles. Parallel policy shifts in Europe and the Middle East mandate sovereign-cloud deployments, prompting global corporations to localize workloads and create fresh pools of in-country capacity. Meanwhile, the removal of egress fees by the three largest public clouds has lowered switching costs, opening opportunities for specialist challengers that differentiate on stacked silicon, proximity, or sector-specific compliance.
Key technology and regulatory catalysts have reshaped the competitive balance. North America currently commands a 39% revenue share, underpinned by deep fiber networks, reliable power, and dense hyperscale clusters. Asia, in contrast, is expanding the fastest at a 13.4% CAGR as 5G penetration, AI start-up activity, and government tax incentives converge to boost new datacenter builds. Hosting services continue to dominate the data processing and hosting services market with a 64% share, yet cloud-native offerings within that category, especially IaaS, PaaS, and SaaS, post the strongest 14.1% CAGR as customers prioritize elasticity. Hybrid and multi-cloud strategies are surging at 12.5% CAGR, signaling that enterprises now view cloud as a portfolio rather than a monolith.
Key Report Takeaways
- By offering, hosting services led with 64% revenue share in 2024, cloud hosting (IaaS/PaaS/SaaS) is advancing at a 14.1% CAGR through 2030
- By deployment model, the hybrid & multi-cloud segment posted a 12.5% CAGR, outpacing the overall data processing and hosting services market size in 2024
- By organisation size, large enterprises captured 71% of the data processing and hosting services market share in 2024, while SMEs recorded the strongest 11.7% CAGR to 2030
- By end-user industry, retail & e-commerce accelerates at a 12.9% CAGR, eclipsing IT & telecom incumbency.
- By region, North America held 39% of 2024 revenue; Asia is projected to grow at 13.4% CAGR to 2030.
Global Data Processing And Hosting Services Market Trends and Insights
Drivers Impact Analysis
Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
---|---|---|---|
Growing migration of enterprise workloads to hyperscale cloud data centers | +3.20% | North America & Europe | Medium term (2-4 years) |
AI/ML workload explosion elevating demand for high-density GPU hosting | +2.70% | Global, focus on North America & Asia | Medium term (2-4 years) |
Proliferation of edge-native applications requiring distributed micro-hosting | +2.10% | Asia & Oceania | Medium term (2-4 years) |
Emergence of sovereign-cloud mandates boosts in-country hosting | +1.80% | EU & Middle East | Short term (≤2 years) |
Source: Mordor Intelligence
Growing Migration of Enterprise Workloads to Hyperscale Cloud Data-Centers
Enterprises continue to de-risk capital budgets by shifting mission-critical systems to hyperscale regions, with U.S. datacenter power demand expected to double to 35 GW by 2030. The move is increasingly capability-driven, anchored in access to AI accelerators and managed security services that remain prohibitively expensive on-prem. Pre-lease agreements now secure capacity years ahead of physical handover, particularly in Ashburn, Phoenix, Dublin, and Frankfurt, where power allotments are constrained.
AI/ML Workload Explosion Elevating Demand for High-Density GPU Hosting
By 2025, over 40,000 companies will run production AI on discrete GPUs, raising computational density and cooling requirements. Dedicated GPU clouds such as Lambda and CoreWeave post triple-digit growth as they guarantee H100 and MI300 inventory for training, fine-tuning, and inference workloads.
Proliferation of Edge-Native Applications Requiring Distributed Micro-Hosting
Edge use cases such as autonomous factory control and in-store analytics demand sub-20 ms latency, propelling micro-datacenter installations at telecom towers, metro rooftops, and retail parks. Global edge spending is projected to reach USD 380 billion by 2028, growing at a 13.8% CAGR. Vendors like Vapor IO layer K-8s orchestration atop container-ready pods, delivering low-touch deployments that minimize backhaul.
Emergence of Sovereign-Cloud Mandates Boosting In-Country Hosting
Regulators in the EU, GCC, and India now enforce data-location mandates that require workloads and encryption keys to stay within national borders. The EU Data Act, effective September 2025, compels clouds to offer seamless switching and cost-based egress, pushing hyperscalers toward joint ventures that confer local operational control. Enterprises accept a 15-25% cost premium for regulatory certainty.
Restraints Impact Analysis
Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
---|---|---|---|
Power-grid instability & rising energy tariffs are limiting data-center expansion | −1.2% | Africa & South Asia | Medium term (2-4 years) |
Data-sovereignty conflicts hindering cross-border hosting | −1.1% | Europe vs US | Medium term (2-4 years) |
Source: Mordor Intelligence
Power-Grid Instability and Rising Energy Tariffs Limiting Data-Center Expansion
Electricity supply shortfalls and surcharges in South Asia and Africa throttle new builds. Data centers consumed 176 TWh of U.S. power in 2023, or 4.4% of national demand, underscoring the tension between compute growth and grid capacity. Operators pivot to onsite solar-plus-battery and micro-grid solutions, inflating capital requirements and elongating deployment schedules.
Data-Sovereignty Conflicts Hindering Cross-Border Hosting
Legal conflicts between the U.S. CLOUD Act and GDPR heighten compliance complexity for multinational corporations. The Sedona Conference highlights the friction in reconciling U.S. discovery obligations with non-U.S. privacy laws, delaying cross-border migrations.
Segment Analysis
By Organisation Size: SMEs Driving Growth Through Digital Transformation
Large enterprises controlled 71% of 2024 revenue, leveraging deep coffers to modernize mainframes, adopt container orchestration, and spin up global DR replicas. In contrast, SMEs are the fastest movers, accelerating at 11.7% CAGR as simplified migration tooling, marketplace credits, and managed DevOps services flatten technical barriers. In African and Latin American markets, more than 90% of SMEs have adopted digital payments, underscoring widespread digital adoption[1]Frontier Fintech, “Digital Payments Adoption among African SMEs,” frontierfintech.com. Governments subsidize training and cloud vouchers, further broadening reach. The absolute data processing and hosting services market size for SMEs is projected to double by 2030, while their slice of overall spending remains under 30% because large-enterprise estates also keep expanding.
SME cloud maturation creates new partner ecosystems. Resellers bundle point-of-sale, analytics, and local-language support, embedding compute costs into service fees. Advanced observability stacks surface anomalies and auto-apply remediation scripts, mitigating the skill gap that once stymied smaller firms. Those efficiencies, in turn, reinforce subscription renewals and incremental upsell, positioning the SME segment as a durable growth flywheel within the broader data processing and hosting services market.
Note: Segment shares of all individual segments available upon report purchase
By Offering: Cloud Hosting Revolutionizing Service Delivery Models
Hosting services delivered 64% of sector revenue in 2024, anchored by reliable compute, storage, and network primitives. The sub-segment of cloud hosting (IaaS, PaaS, SaaS) commands a 14.1% CAGR to 2030, fueled by elastic scaling, bundled APIs, and declining unit pricing as hyperscalers aggregate demand. Customers increasingly favor workload-optimized tiers, GPU clusters for AI, ARM cores for web tier, and z-parity CICS as a service for financial ledgers. Concurrently, professional services revenue grows as firms seek cloud-native redesign, data pipeline refactor, and FinOps governance. Edge and colocation providers embed cloud-like provisioning into portals, blurring the lines between core and distributed hosting. Over time, integrated pipelines that marry data preparation with compute will erode standalone ETL vendors, folding their economics into the data processing and hosting services market gatekeepers.
Financial flexibility remains a draw. Pay-by-the-second billing and sustained-usage credits lower the total cost of ownership. As energy costs fluctuate, workloads re-balance across regions based on real-time power spot prices, a capability accessible only through cloud automation. The result is a structurally higher utilization rate, translating to margin expansion for providers and cost predictability for tenants.
By Deployment Model: Hybrid and Multi-Cloud Strategies Gaining Momentum
Public cloud owned 58% of 2024 spending, yet hybrid & multi-cloud architectures post the steepest 12.5% CAGR through 2030 as firms seek workload portability and jurisdictional compliance[2]HCLTech, “Hybrid Infrastructure Adoption Survey 2024,” hcltech.com. Vendor-neutral control planes orchestrate containers across on-prem, colocation, and hyperscale regions while policy engines enforce data-location and encryption standards. Cross-cloud service mesh enables developers to pair best-of-breed accelerators and managed databases without vendor lock. The data processing and hosting services market size for hybrid deployments is forecast to expand 2.3× within five years, mirrored by toolchain vendors adding automated cost arbitrage and compliance reporting.
End-user confidence rises as reliability metrics improve. Distributed object storage replicates data across cloud boundaries, minimizing RTO and RPO while satisfying local regulators. Cost optimization stems from running dev-test on lower-cost clouds and production on latency-adjacent regions. Enterprises report savings of 18% after adopting dynamic placement algorithms that rebalance compute based on spot pricing and sustainability scores.
Note: Segment shares of all individual segments available upon report purchase
By End-User Industry: Retail and E-Commerce Transformation Accelerates Adoption
IT & telecom led spending with a 24% share in 2024, but retail & e-commerce now records a 12.9% CAGR to 2030 as merchants digitize supply chains and deploy personalization engines. Global e-commerce sales are projected to capture 23% of retail by 2027, with revenue topping USD 6.4 trillion by 2029[3]Hostinger, “E-Commerce Share of Global Retail Sales,” hostinger.com . Spiking holiday traffic pushes merchants into autoscaling front-ends and serverless APIs. Real-time fraud detection consumes GPU-accelerated analytics, nudging retailers toward specialized hosting tiers.
BFSI workloads remain lucrative owing to stringent encryption and audit needs. Banks deploy dual-provider active-active architectures that isolate keys from compute, satisfying both resiliency and jurisdictional mandates. Healthcare providers embrace HIPAA-aligned platforms for telemedicine and genomic sequencing. Manufacturing adopts digital twins that ingest continuous sensor streams into AI-based predictive maintenance dashboards. Collectively, industry-specific clouds underpin differentiated service bundles, spiraling sector stickiness, and push the data processing and hosting services market deeper into vertical integration.
Geography Analysis
North America claimed 39% of 2024 revenue on the back of vast fiber backbones, generous tax incentives, and dense hyperscale clusters. Loudoun County, Virginia, alone hosts over 30 million square feet of raised floor and is now facing grid-interconnection pauses due to transformer constraints. Providers respond with campus-scale micro-grids, 24×7 renewable PPAs, and reclaimed-heat reuse programs to counter sustainability scrutiny. AWS, Microsoft, and Google collectively earmarked more than USD 255 billion for new U.S. halls in 2025, ensuring the region’s capacity lead. Privacy legislation at the state level, such as California CCPA and Texas privacy bills, could demand that data copies remain in-state, subtly reshaping deployment footprints inside the data processing and hosting services market.
Asia records the fastest 13.4% CAGR as 5G proliferation, digital banking, and AI start-up ecosystems converge. Singapore’s moratorium on new datacenter permits diverts cap-ex toward Johor, Batam, Bangkok, and Hyderabad, all vying to become the region’s latency hubs. Japanese operators exploit underused geothermal in Hokkaido while Chinese hyperscalers replicate domestic super-app stacks to Southeast Asia, blending compute with payments and logistics. Smartphone saturation and real-time translation services multiply data flows, anchoring durable demand.
Europe’s sovereignty agenda steers procurement trends. The EU’s Digital Europe Programme has allocated EUR 900 million to cloud marketplaces and security centers, catalysing domestic capacity. Germany and France vie for AI training clusters by touting nuclear and hydro power mixes. Gaia-X lays interoperability standards, albeit slower than first envisioned. Nordic states leverage cheap hydroelectricity yet grapple with limited fiber routes; Eastern European states woo investors through special economic zones, though geopolitical risk remains a hurdle. Notably, post-Brexit UK relaxes VAT on datacenter gear, attracting trans-Atlantic investment and reinforcing London’s pole position.

Competitive Landscape
The data processing and hosting services market remains moderately concentrated. AWS, Microsoft Azure, and Google Cloud hold a combined 63% of global cloud services revenue as of Q1 2025, with AWS alone at 29%. AWS accelerates its Trainium2 roadmap, promising 50% lower price-performance for AI training. Microsoft layers vertical stacks like Cloud for Retail and Fabric analytics to entrench sector-specific workflows. Google posts the fastest growth, crediting partnerships with Anthropic and open-source communities that court developer mindshare. Collectively, these giants pledge more than USD 255 billion in U.S. datacenter cap-ex and USD 120 billion across EMEA and APAC in 2025, raising barriers to entry.
Specialist providers seize niches neglected by hyperscalers. CoreWeave and Lambda specialize in GPU clouds with deterministic performance and transparent scheduling, resonating with media, life-science, and research clients. Digital Realty, Equinix, and NTT advance colocation models that bundle dedicated white-space with managed liquid-cool loops. Regional telcos such as MTN and Telefónica overlay 5G network slices with low-latency compute nodes, blurring the edge/mobile divide inside the data processing and hosting services market. Sovereign-cloud joint ventures Capgemini/Orange and T-Systems/Google address public-sector trust gaps through ring-fenced operations.
Pricing models evolve. The wave of egress-fee eliminations after the EU Data Act scrutiny eases migration friction and amplifies multi-cloud adoption. Cost-management vendors like Spot and Zesty ingest real-time bills across providers, promoting automated rightsizing. Hyperscalers shift differentiation toward AI APIs, proprietary vector databases, and turnkey compliance blueprints. As the leading five providers collectively command about an 80% share, the market concentration score stands at 8, indicating an oligopolistic yet vigorously contested arena.
Data Processing And Hosting Services Industry Leaders
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GoDaddy Operating Company LLC.
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Hostinger International Ltd.
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Teradata Corporation
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IBM Corporation
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Bluehost (Endurance International Group)
- *Disclaimer: Major Players sorted in no particular order

Recent Industry Developments
- May 2025: Microsoft confirmed USD 80 billion AI-centric datacenter investments, including expansions in Texas and Wisconsin.
- April 2025: OpenMetal launched private GPU servers optimized for AI/ML workloads.
- April 2025: Amazon Web Services announced USD 100 billion 2025 AI infrastructure cap-ex focused on higher-density campuses.
- March 2025: OpenAI, SoftBank, and Oracle launched Stargate, a 20-site renewable-energy AI datacenter JV.
Global Data Processing And Hosting Services Market Report Scope
Data processing includes collecting and manipulating different forms of data to extract meaningful insights. Companies extend their access to a large dataset to gain a competitive edge and deliver critical business insights to their clients. Data processing is done to convert data into a usable and desired form. Hosting services include web hosting, off-site backup, virtual desktops, and cloud services. Hosted services accessed from an external provider take various conditions that may be categorized differently.
The Data Processing and Hosting Services Market are segmented by the organization (large enterprise, small & medium enterprise) offering (data processing services (data entry services, data mining services, data cleansing and formatting, and data scanning and indexing), hosting services (web hosting, cloud hosting, shared (reseller) hosting, virtual private server (VPS) hosting, WordPress hosting, and application hosting)), end-user industry (IT & Telecommunication, BFSI, retail, and other end-user industries), and geography (North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa).
The market sizes and forecasts are in terms of value (USD billion) for all the above segments.
By Organisation Size | Large Enterprises | |||
Small and Medium Enterprises (SME) | ||||
By Offering | Data Processing Services | Data Entry Services | ||
Data Mining Services | ||||
Data Cleansing and Formatting | ||||
Data Scanning and Indexing | ||||
Managed ETL and Analytics | ||||
Hosting Services | Shared (Reseller) Hosting | |||
Virtual Private Server (VPS) Hosting | ||||
Dedicated Server Hosting | ||||
Cloud Hosting | IaaS | |||
PaaS | ||||
SaaS | ||||
Managed WordPress Hosting | ||||
Application Hosting | ||||
Colocation and Bare-Metal | ||||
By Deployment Model | Public Cloud | |||
Private Cloud | ||||
Hybrid and Multi-Cloud | ||||
By End-user Industry | IT and Telecommunication | |||
BFSI | ||||
Retail and E-commerce | ||||
Manufacturing | ||||
Healthcare and Life Sciences | ||||
Media and Entertainment | ||||
Government and Public Sector | ||||
Others (Education, Hospitality, etc.) | ||||
By Geography | North America | United States | ||
Canada | ||||
Mexico | ||||
South America | Brazil | |||
Argentina | ||||
Rest of South America | ||||
Europe | Germany | |||
United Kingdom | ||||
France | ||||
Rest of Europe | ||||
Middle East | Saudi Arabia | |||
UAE | ||||
Turkey | ||||
Rest of Middle East | ||||
Africa | South Africa | |||
Nigeria | ||||
Rest of Africa | ||||
Asia Pacific | China | |||
India | ||||
Japan | ||||
South Korea | ||||
Rest of Asia Pacific |
Large Enterprises |
Small and Medium Enterprises (SME) |
Data Processing Services | Data Entry Services | ||
Data Mining Services | |||
Data Cleansing and Formatting | |||
Data Scanning and Indexing | |||
Managed ETL and Analytics | |||
Hosting Services | Shared (Reseller) Hosting | ||
Virtual Private Server (VPS) Hosting | |||
Dedicated Server Hosting | |||
Cloud Hosting | IaaS | ||
PaaS | |||
SaaS | |||
Managed WordPress Hosting | |||
Application Hosting | |||
Colocation and Bare-Metal |
Public Cloud |
Private Cloud |
Hybrid and Multi-Cloud |
IT and Telecommunication |
BFSI |
Retail and E-commerce |
Manufacturing |
Healthcare and Life Sciences |
Media and Entertainment |
Government and Public Sector |
Others (Education, Hospitality, etc.) |
North America | United States |
Canada | |
Mexico | |
South America | Brazil |
Argentina | |
Rest of South America | |
Europe | Germany |
United Kingdom | |
France | |
Rest of Europe | |
Middle East | Saudi Arabia |
UAE | |
Turkey | |
Rest of Middle East | |
Africa | South Africa |
Nigeria | |
Rest of Africa | |
Asia Pacific | China |
India | |
Japan | |
South Korea | |
Rest of Asia Pacific |
Key Questions Answered in the Report
What is the current size of the data processing and hosting services market?
The market stands at USD 118.83 billion in 2025.
How fast will the data processing and hosting services market grow by 2030?
It is projected to expand at a 10.48% CAGR, reaching USD 195.55 billion by 2030.
Which region holds the largest revenue share today?
North America leads with 39% market share in 2024.
Why are hybrid and multi-cloud deployments gaining traction?
They deliver workload portability, jurisdictional compliance, and cost optimization, posting a 12.5% CAGR through 2030.
How are hyperscalers addressing vendor-lock concerns?
Major providers have begun eliminating or reducing egress fees, making it easier for customers to adopt multi-cloud strategies .
Which end-user industry is growing the fastest?
Retail & e-commerce workloads register a 12.9% CAGR as merchants digitize customer experiences.