Market Trends of Frankfurt Data Center Industry
Tier 3 Segment is Expected to Hold Significant Share of the Market
- To be defined as a Tier III facility, a data center must adhere to the following specification. The facility should offer N+1 (the amount required for operation plus a backup) fault tolerance. Also, the Tier III facility providers can undergo routine maintenance without a hiccup in the overall operations. However, unplanned maintenance and emergencies may cause problems affecting the system. These problems may potentially affect customer-facing operations.
- These data center facilities provide a 99.982% uptime. The companies using these Tier III facilities are often growing companies or businesses that are considerably larger than the average SMBs (Small to Medium Businesses). These Tier III facilities also offer most of the features of a Tier IV infrastructure facility without some elite protection. For instance, enterprises can leverage the advantage of dual power sources and redundant cooling as the network streams are fully backed up.
- Moreover, owing to the robust cloud market growth amid the global pandemic, many companies accelerated their digital transformation efforts. Companies like Tencent Cloud added four data centers to increase global coverage by 30% in 2021. The company added four new data center locations globally, out of which one is a Tier III facility located in the prime network hub of Frankfurt. The move pushes its network footprint to 27 regions and 66 availability zones worldwide. Such expansion efforts are increasing the city's adoption of Tier III facilities.
- The difficulties of maintaining a private IT infrastructure have long prompted businesses to investigate other data and computing solutions. There is, thankfully, an option. Companies may get all of the power and control of an on-premises solution with the flexibility and cost-effectiveness of the cloud by using colocation data centers. Today's data center providers are using the data center as a service (DCaaS) model to offer attractive solutions for fast-growing businesses trying to compete in an increasingly congested market where speed and adaptability are crucial to success.
- According to Ookla (speedtest.net), in February 2023, the average download speed in Germany was 83.69 Mbit per second. This was faster than in October 2022, when the average speed was 77.34 Mbit per second. Data centers can have varying internet speeds depending on many factors such as network architecture, location, and capacity. Some data centers have speeds of 5Gb/sec, while others can have speeds of 100Gb/sec or beyond. However, as the demand for faster and more efficient data processing continues to increase, many data centers are upgrading their networks to support speeds ranging from 10GB to 100GB.
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Cloud & IT is Expected to Drive the Market
- The amount of data stored and processed by the telecom and IT industry is enormous. The advent of mobile data and subscriptions, coupled with their rapid usage, has increased data traffic growth and hence, data centers in Germany. With the introduction of 5G and Cloud, the country's demand is expected to grow exponentially. The country's IT industry necessitates data storage and hyper-scale data centers for its operations according to their size. Additionally, cloud storage selection has progressed over the years due to growth in SaaS providers in the country, enabling cloud storage providers to expand their capacities. It is expected to increase the demand for the data center market.
- The pragmatic choices of data center construction solutions, efficient innovation ecosystem, and substantial private sector investment made the sector significant in the current market. Data centers of the telecom and IT industries across the globe are focusing on services that enable the data centers to meet the future demand by virtualizing and enhancing servers, thus, making transformational changes in storage capabilities and addressing the green IT issues. Typical hardware infrastructure optimization projects being handled by significant organizations are resulting in the reduction of total cost ownership by more than 20%, and this is a prompting aspect for enterprises to adopt more efficient construction solutions.
- For example, in February 2022, A 112-megawatt, 1.2 million sqft (108k sqm), hyperscale data centre campus is being built by CloudHQ, a hyperscale data centre developer and operator in the US and Europe, in Offenbach, Germany, a city that borders Frankfurt to the southeast. With a total investment of EUR 1.1 billion (USD 1.18 billion), CloudHQ's Frankfurt data centre campus will be the biggest in Germany once fully constructed.
- According to Federal Network Agency, in 2022, there were roughly 169 million mobile connections in Germany, such huge number would create opportunities for cloud deployment. Mobile cloud computing is a growing area that provides mobile users with access to computing resources and services through the cloud. This can allow mobile devices to offload computationally intensive tasks to remote servers, reducing the strain on the mobile device's processing power and battery life. Examples of mobile cloud applications include mobile gaming, location-based services, and augmented reality applications.
