According to our latest study on "Australia Data Center Colocation Market Forecast to 2028 – COVID-19 Impact and Country Analysis – by Type, Enterprise Size, and Industry,” the market is projected to grow from US$ 3,094.62 million in 2022 to US$ 7,885.00 million by 2028; it is expected to record a CAGR of 17.2% from 2023 to 2028.

Adoption of Technologies such as IoT and Cloud Fuels Australia Data Center Colocation Market Growth

IoT generates a huge amount of data that needs to be processed, stored, and analyzed in real time. Cloud computing provides a cost-effective way to store and process this data in a centralized location without investing in expensive hardware and infrastructure. As organizations shift their IT infrastructure to the cloud, they often require colocation facilities to leverage various facilities such as additional space, power, and cooling for servers, storage, and networking equipment. The adoption of IoT and cloud technologies has led to an increase in interconnected devices and systems, resulting in a growing need for high-speed and low-latency network connectivity. The data center colocation providers offer a secure hardware environment to store and access data essential to support IoT and cloud-based applications. Thus, the adoption of IoT and cloud services creates the need for the adoption of data center colocation and driving the Australia Data Center Colocation Market growth.

Additionally, with the growing adoption of IoT and cloud technologies, the Australia Data Center Colocation Market players in Australia are setting up new units to deliver their services to enhance the accessibility of the cloud and digital infrastructure of their customers. In December 2021, NEXTDC LTD, a data center colocation provider, opened its first edge data center in Queensland to provide low latency and services across Australia. In addition, in October 2022, the company launched a 100,000-square-meter data center in Melbourne with an investment of US$ 1.5 billion. Such launches of data centers in the country will attract more customers to leverage their services with the adoption of cloud and IoT, further propelling the Australia Data Center Colocation Market growth in Australia.

Australia is a prominent market for data center colocation, especially in BFSI and IT & telecom sectors. Australia was severely affected due to the COVID-19 outbreak. However, the outbreak positively impacted the Australia Data Center Colocation Market growth as data center colocation technologies helped businesses to address and handle increased internet traffic. According to Australian Communication and Media Authority, the COVID-19 outbreak accelerated the use of the Internet in 2020. The pandemic changed the way how businesses were used to working traditionally. Online presence replaced the physical presence. Every industry sector worldwide has been going through digital transformation, contributing to increased internet traffic. As the data center colocation providers were able to handle the increased internet traffic during the pandemic, businesses started adopting the data center colocation services. Rather than investing in their own data center, businesses started investing in colocation services, which boosted the Australia Data Center Colocation Market growth during the pandemic.

Key Findings of Study:

The Australia Data Center Colocation Market is segmented based on type, enterprise size, and industry. Based on type, the Australia Data Center Colocation Market is segmented into retail and wholesale. Based on enterprise size, the Australia Data Center Colocation Market is bifurcated into SMEs and large enterprises. Based on industry, the Australia Data Center Colocation Market is segmented into IT & telecom, BFSI, healthcare, retail, and others.

Based on type, the Australia Data Center Colocation Market is segmented into retail and wholesale. The retail segment dominated the Australia Data Center Colocation Market in 2022. A retail data center colocation service is provided to businesses wanting to lease a space. It is the ideal and cost-effective solution for small startups and SMEs to rent a rack or a required area in a data center rather than leasing a whole data center. Retail colocation space is usually considered rented space under ten colocation racks or cabinets, which is beneficial for startups and SMEs to store and manage their data. Therefore, the rising demand for cost-effective retail colocation services among businesses is contributing to the Australia Data Center Colocation Market growth. In addition, the rising number of startups in Australia is expected to create an opportunity for the retail Australia Data Center Colocation Market during the forecast period. For instance, according to StartupBlink, Australia ranked first in the Asia Pacific regional market and eighth in the global startup scene market in 2022. Moreover, retail data center colocation services offer several benefits, such as high data security and data maintenance at a lower cost than owning a data center, which increases the demand for retail colocation, further propelling the Australia Data Center Colocation Market growth.

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