Hong Kong Data Center Networking Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)

The Hong Kong Data Center Networking Market Report is Segmented by Component Type (Product (Ethernet Switches, Router, Storage Area Network (SAN), Application Delivery Controller (ADC), and Other Networking Equipment), Services (Installation & Integration, Training and Consulting, and Support & Maintenance)), and by End User (IT & Telecommunication, BFSI, Government, and Media & Entertainment, and Other End User). The Market Sizes and Forecasts are Provided in Terms of Value (USD) for all the Above Segments.

Hong Kong Data Center Networking Market Size

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Hong Kong Data Center Networking Market Summary
Study Period 2018-2029
Base Year For Estimation 2023
Market Size (2024) USD 332.38 Million
Market Size (2029) USD 470.99 Million
CAGR (2024 - 2029) 7.22 %
Market Concentration Medium

Major Players

Hong Kong Data Center Networking Market Major Players

*Disclaimer: Major Players sorted in no particular order

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Hong Kong Data Center Networking Market Analysis

The Hong Kong Data Center Networking Market size is estimated at USD 332.38 million in 2024, and is expected to reach USD 470.99 million by 2029, growing at a CAGR of 7.22% during the forecast period (2024-2029).

The increasing demand for cloud computing among SMEs, government regulations for local data security, and growing investment by domestic players are some of the major factors driving the demand for data centers in the country.

  • Under Construction IT Load Capacity: The upcoming IT load capacity of the Hong Kong data center market is expected to reach 1700 MW by 2029.
  • Under Construction Raised Floor Space: The country's construction of raised floor area is expected to increase to 6 million sq. ft by 2029.
  • Planned Racks: The country's total number of racks to be installed is expected to reach 230K units by 2029. NCR Ho Chi Minh City is expected to house the maximum number of racks by 2029.
  • Planned Submarine Cables: There are close to 2 submarine cable systems connecting Hong Kong, and we expect a few cables to come in the near future. One such submarine cable that is estimated to start service in 2025 is Asia Cable Link ALC, which stretches over 6,000 Kilometers with landing points from Hong Kong SAR, Mainland China.
  • In view of its commitment to reach a carbon dioxide peak by 2030 and be carbon neutral by 2060, Hong Kong is placing energy consumption control at the top of its priorities. Its ongoing “dual control” energy consumption policy is a regulatory effort aiming to control high energy consumption and limit high-emission projects.
  • In support of the above policy and to reduce energy consumption, key market players are focusing on transforming DC facilities with efficient power management systems, which is expected to increase market growth.

Hong Kong Data Center Networking Market Trends

IT & Telecommunication Segment to Hold Major Share in the Market.

  • The demand for the cloud segment is expected to increase with the growing demand for analytics, visualization tools, and business services. Also, the Increasing adoption of cloud-based services is driving the expansion of hyperscale and wholesale colocation services in Hong Kong, resulting in increased demand for space in data centers and, consequently, the need for more network devices and services within data centers.
  • With 5G being introduced in the country, high bandwidth speeds offered led to users opting for multiple smart devices, such as smart wearables, tablets, security systems, smart lighting, and others, which have catalyzed the demand for these devices. Around 96% of the population in Hong Kong currently uses smartphones to access the internet on a daily basis.
  • To meet the surplus demand, automation has to be introduced in the industry as per Industry 4.0 measures. Increasing demand for streaming services, financial services, and smart home automation applications is expected to further catalyze data consumption.
  • Users of smart devices, use their smartphones and tablets for streaming, browsing, and playing games, which has led to consumers opting for 4G services, thus diminishing the 3G service market over the years. The implementation of 5G is expected to further increase the data speed with the evolving technology over the years, which is expected to cater to the demand as more industries adopt automation in their companies in the manufacturing sector. Such improvements in the market are expected to create more demand for data center servers in the coming years.
  • The Minister of Posts and Telecommunications announced the ministry's plans to connect 2,715 kilometers of submarine fiber optic cable network from Hong Kong to Preah Sihanouk. The project was initiated in 2022 and will be completed by 2024. Such developments are expected to increase the adoption of data storage solutions and positively impact market growth.
Hong Kong Data Center Networking Market: 5G monthly subscriptions, in Millions, Hong Kong, May 2022 - May 2023

Ethernet Switches Holds Largest Market Share

  • Data Center Ethernet switches are network devices that operate in a data center environment. In order to facilitate the efficiency and rapid transfer of data, they play an essential role in establishing interconnection between servers, storage devices, or other network equipment at a data center. Switches are designed for high-speed data transmission with support for gigabit and multigigabit Ethernet, including 10 GbE, 25 GbE, 40 GbE, 100 GbE, and beyond.
  • Hong Kong is a major center for finance in Asia. Data centers are essential for high-frequency trading and financial transactions that characterize the industry, supported by robust Ethernet switches. To operate in the Financial Industry, latency and high-throughput switches are essential.
  • Further, Hong Kong has an increasing demand for cloud services and hosting solutions. In data centers that provide cloud computing services, Ethernet switches play a vital role in supporting the infrastructure companies require to house applications, store information, and access IT resources from remote locations.
  • In addition, the smart city initiatives of Hong Kong require a resilient and efficient information technology infrastructure. The development of smart city applications and supporting network needs for technologies that increase the quality of life, transport, or municipal services are supported by Ethernet switches.
  • Moreover, the Increasing focus on digitalization, Internet penetration (reached 93.1% by the start of 2023 from 93% during the same period in 2022), Strong connectivity, and e-commerce sales across the country create more need for storage facilities, resulting in huge demand for data centers and consequently the need for more ethernet switches within data centers.
  • The key players in the market focus on updating the network devices to meet the market demand. In June 2023, Cisco’s Nexus 9800 Series modular switches expand the Cisco Nexus 9000 Series portfolio with a new chassis architecture to include a combination of several first-generation line cards and fabrics modules, allowing it to scale from 57 Tbps up to 115 Tbps. Line cards that now offer 400 GE or 100 GE ports and higher speeds can be supported by each line card slot on the chassis.
Hong Kong Data Center Networking Market: Number of Internet Users, in Millions, Hong Kong, 2020-2029

Hong Kong Data Center Networking Industry Overview

The upcoming DC construction projects in the country will increase the demand for the Hong Kong data center networking market in the coming years. The Hong Kong data center networking market is moderately consolidated with some players in the market, including Cisco Systems Inc., Arista Networks Inc., H3C Technologies Co., Ltd., VMware Inc., and Huawei Technologies Co. Ltd. These major players, with a prominent market share, focus on expanding their regional customer base.

In April 2023, to expand their capabilities in a broader range of data centers, IBM introduced new single frame and rack mounting configurations of IBM z16 and IBM LinuxONE 4. Based on IBM's Telum processor, new options enable clients to adapt to the digital economy and are designed sustainably for highly efficient data centers.

Hong Kong Data Center Networking Market Leaders

  1. Cisco Systems Inc.

  2. Arista Networks Inc.

  3. H3C Technologies Co., Ltd.

  4. VMware Inc

  5. Huawei Technologies Co. Ltd.

*Disclaimer: Major Players sorted in no particular order

Hong Kong Data Center Networking Market Concentration
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Hong Kong Data Center Networking Market News

  • March 2023: Arista Networks announced the release of the Arista WAN Routing System, which combines three new networking offerings, including carrier/cloud-neutral Internet transit capabilities, enterprise-class routing platforms, and the CloudVision Pathfinder Service to simplify and improve customer-wide area networks. This system delivers the architecture, features, and media to modernize federated and software-defined wide-area networks.
  • January 2023: In response to the growing demands of today's data center environment, Dell Inc. has introduced Power switch S520ON 25 GbE fixed switches consisting of all Technologies' latest disaggregated hardware switching and networking solutions that provide state-of-the-art high-density 25 GbE ports and a wide range of functionality. These switches provide optimum flexibility and cost-effectiveness for web 2.0, cloud service providers, and enterprises with demanding compute and storage network traffic environments.

Hong Kong Data Center Networking Market Report - Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumption & Market Definition

    2. 1.2 Scope of the Study

  2. 2. Research Methodology

  3. 3. Executive Summary

  4. 4. Market Dynamics

    1. 4.1 Market Overview

    2. 4.2 Market Drivers

      1. 4.2.1 Increasing Adoption of Cloud-Based Services Drives the Market Growth

      2. 4.2.2 Growing Demand for Energy Efficiency and Sustainability in Data Center Facilities

    3. 4.3 Market Restraints

      1. 4.3.1 High Initial Investments

    4. 4.4 Value Chain / Supply Chain Analysis

    5. 4.5 Industry Attractiveness - Porter's Five Forces Analysis

      1. 4.5.1 Threat of New Entrants

      2. 4.5.2 Bargaining Power of Buyers/Consumers

      3. 4.5.3 Bargaining Power of Suppliers

      4. 4.5.4 Threat of Substitute Products

      5. 4.5.5 Intensity of Competitive Rivalry

    6. 4.6 Assessment of COVID-19 Impact

  5. 5. MARKET SEGMENTATION

    1. 5.1 By Component

      1. 5.1.1 By Product

        1. 5.1.1.1 Ethernet Switches

        2. 5.1.1.2 Router

        3. 5.1.1.3 Storage Area Network (SAN)

        4. 5.1.1.4 Application Delivery Controller (ADC)

        5. 5.1.1.5 Other Networking Equipment

      2. 5.1.2 By Services

        1. 5.1.2.1 Installation & Integration

        2. 5.1.2.2 Training & Consulting

        3. 5.1.2.3 Support & Maintenance

    2. 5.2 End-User

      1. 5.2.1 IT & Telecommunication

      2. 5.2.2 BFSI

      3. 5.2.3 Government

      4. 5.2.4 Media & Entertainment

      5. 5.2.5 Other End-User

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Company Profiles

      1. 6.1.1 Cisco Systems Inc.

      2. 6.1.2 Arista Networks Inc.

      3. 6.1.3 H3C Technologies Co., Ltd.

      4. 6.1.4 VMware Inc

      5. 6.1.5 Huawei Technologies Co. Ltd.

      6. 6.1.6 Extreme Networks Inc.

      7. 6.1.7 NVIDIA Corporation (Cumulus Networks Inc.)

      8. 6.1.8 Dell Inc.

      9. 6.1.9 NEC Corporation

      10. 6.1.10 IBM Corporation

      11. 6.1.11 HP Development Company, L.P.

      12. 6.1.12 Schneider Electric

      13. 6.1.13 Siemens

    2. *List Not Exhaustive
  7. 7. INVESTMENT ANALYSIS

  8. 8. MARKET OPPORTUNITIES AND FUTURE TRENDS

**Subject to Availability
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Hong Kong Data Center Networking Industry Segmentation

Data center networking refers to the set of technologies, protocols, and hardware used to connect physical and network-based devices and manage the network infrastructure, storage, and processing of applications and data. Data center networking is very critical for 100% uptime of data centers. In the current web-connected world, business workloads are executed on single computers, hence leading to the need for data center networking. Networks provide servers, clients, applications, and middleware with a standard plan to stage the execution of workloads and also to manage access to the data produced.

The Hong Kong Data center networking market is segmented by component type (product (Ethernet switches, routers, storage area network (SAN), application delivery controller (ADC), and other networking equipment), services (installation & integration, training & consulting, and support & maintenance)), and by end-user (IT & telecommunication, BFSI, government, and media & entertainment, and other end-user). The market sizes and forecasts are provided in terms of value (USD) for all the above segments.

By Component
By Product
Ethernet Switches
Router
Storage Area Network (SAN)
Application Delivery Controller (ADC)
Other Networking Equipment
By Services
Installation & Integration
Training & Consulting
Support & Maintenance
End-User
IT & Telecommunication
BFSI
Government
Media & Entertainment
Other End-User
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Hong Kong Data Center Networking Market Research FAQs

The Hong Kong Data Center Networking Market size is expected to reach USD 332.38 million in 2024 and grow at a CAGR of 7.22% to reach USD 470.99 million by 2029.

In 2024, the Hong Kong Data Center Networking Market size is expected to reach USD 332.38 million.

Cisco Systems Inc., Arista Networks Inc., H3C Technologies Co., Ltd., VMware Inc and Huawei Technologies Co. Ltd. are the major companies operating in the Hong Kong Data Center Networking Market.

In 2023, the Hong Kong Data Center Networking Market size was estimated at USD 308.38 million. The report covers the Hong Kong Data Center Networking Market historical market size for years: 2018, 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Hong Kong Data Center Networking Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.

Hong Kong Data Center Networking Industry Report

Statistics for the 2024 Hong Kong Data Center Networking market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Hong Kong Data Center Networking analysis includes a market forecast outlook to for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.

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Hong Kong Data Center Networking Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)