---

Market Overview

---

The global data center storage market is projected to grow at a compound annual growth rate (CAGR) of 4.72% from 2022 to 2027, reaching USD 64.28 billion by 2027 compared to USD 48.73 billion in 2021. Data center storage encompasses the infrastructure, tools, processes, and technologies involved in designing, managing, and monitoring data stored within a data center. Data storage can be classified into three levels: block, file, and object.

The market for data center storage includes various products such as hard disk drives (HDDs), storage networking, solid state drives (SSDs), and other infrastructure components. These technologies are essential for efficient data center storage.

Currently, HDD adoption dominates the data center storage market, with approximately two-thirds of the market utilizing this technology. Key vendors in this space include Seagate Technology, Western Digital, and Toshiba. However, there is a growing demand for SSDs, particularly from data center operators and telecom companies deploying edge data centers and advanced technologies like cloud computing, AI, IoT, and big data.

The global demand for cloud and colocation services has significantly increased, particularly since the COVID-19 pandemic. North America holds the largest share of the data center storage market, followed by regions like APAC and Europe. The market is primarily driven by expansions by global and local cloud service providers. Additionally, the growing consumption of online content and digitalization initiatives across industries contribute to the increasing demand. Governments worldwide are allocating higher budgets for IT spending to develop their digital economies, which further fuels the global data center storage market.

Key trends that will drive the market in the coming years include the rise of edge deployments, adoption of flash/NVMe storage, and the growing popularity of software-defined storage. Among the various storage infrastructures, NAS storage accounts for approximately 70% of the market share. Content providers, media companies, and entertainment businesses are expected to be major adopters of NAS-based flash storage solutions.

Traditional storage, particularly HDDs, currently dominates the global data center storage market. However, hybrid storage, which combines the capabilities of HDDs and SSDs, is expected to witness increased adoption in the coming years and grow at a higher CAGR. Vendors like Seagate Technology, Toshiba, and Western Digital supply HDDs to the data center storage market. Major SSD vendors include Pure Storage, Huawei Technologies, Dell Technologies, and Fujitsu.

Cloud, IT, and telecom sectors are expected to experience the fastest growth in the industry worldwide. Factors driving this growth include increased cloud adoption by businesses, the establishment of data centers for 5G deployments, and the pay-as-you-go model for cloud storage. The BFSI sector is another industry expected to witness significant growth in storage infrastructure adoption. For instance, Brubank, authorized by the Central Bank of Argentina, onboarded over 1.5 million users in 2021, while WeBank, backed by Tencent, caters to approximately 200 million people.

The adoption of technologies such as big data and IoT, driven by digitalization initiatives among local enterprises, has led to a substantial increase in the procurement of all-flash and hybrid array systems.

Innovations in storage media, such as DNA and holographic storage, are expected to have an impact on the global data center storage market. The tape storage market is also making a comeback with companies like Quantum and Hewlett Packard Enterprise offering tape storage solutions.

The adoption of software-defined storage is predicted to increase in data center storage, mainly due to the challenge of storing over 80% of unstructured data in traditional storage systems. Although the current market adoption of software-defined storage for these use cases is relatively low, countries like Western Europe, the US, and China are expected to drive its growth, along with hyper-converged platforms and rack-level architecture.

---

Market Segmentation

---

The market is segmented based on various factors, including storage architecture, system, industry, and geography.

Segmentation by Storage Architecture
NAS
SAN
DAS

Segmentation by System
Traditional Storage
Flash Storage
Hybrid Storage

Segmentation by Industry
BFSI Sector
Government Sector
Cloud/IT Sector
Others Industrial Sectors

Segmentation by Geography
North America – US, Canada
Europe – UK, Germany, France, Netherlands, Ireland, Other Western European Countries, Nordics, Sweden, Other Nordic Countries, Central & Eastern Europe, Russia, Other Central & Eastern European Countries
APAC – China & Hong Kong, Australia & New Zealand, Japan, India, Rest of APAC, Southeast Asia, Singapore, Other Southeast Asian Countries
Latin America – Brazil, Other Latin American Countries
Middle East & Africa – UAE, Saudi Arabia, Other Middle Eastern Countries, Africa, South Africa, Other African Countries

File-level access to data is facilitated by Network Attached Storage (NAS), which utilizes the existing IP network for data transfer. NAS operates on protocols like NFS (Network File System) or CIFS (Common Internet File System).

Storage Area Network (SAN), on the other hand, provides block-level access to data and can be categorized based on interconnection schemes such as FC SAN and iSCSI SAN. FC SAN enables communication between servers and external storage systems at speeds ranging from 2 to 32 Gbps.

Direct Attached Storage (DAS) is a topology where storage devices are directly connected to servers. These solutions typically use NAND flash-based technology.

In traditional storage, devices primarily support Hard Disk Drives (HDD). HDDs are non-volatile storage that retains data even after the system is powered off. Although HDDs have slower speeds compared to Solid State Drives (SSDs), they offer higher capacities at lower prices. As a result, HDDs currently dominate the Latin America data center storage market.

Flash storage, utilizing non-volatile flash memory, is widely used in SMEs and large businesses as a storage system that can retain data for extended periods.

Hybrid drives combine the capabilities of HDDs and SSDs in a single device. They utilize SSDs as a cache for frequently accessed data, taking advantage of their faster access capability, while also benefiting from the higher storage capacity of HDDs. Hybrid storage optimizes storage utilization, reduces storage footprint, and streamlines storage management.

North America contributes over 40% of global spending on storage infrastructure, followed by APAC. In the forecast period, storage infrastructure spending in Africa, the Middle East, and the Nordics is expected to experience double-digit compound annual growth rate (CAGR).

Colocation providers are the dominant players in the Latin America data center market, with internet and cloud service providers following closely behind. The expansion of cloud computing is crucial for colocation providers as they add connectivity to cloud platforms such as AWS, Google, Oracle, Microsoft, and IBM.

The Middle East data center industry is driven by factors like growing internet penetration, social media usage, and smart initiatives. Telecommunication providers, enterprises, governments, cloud service providers, and colocation service providers are major investors in data center facility development.

Poland, Spain, Portugal, Belgium, and Italy are emerging investment destinations in Europe and are expected to make significant contributions to the global data center storage market.

APAC remains the preferred region for cloud service and global colocation providers. The industry in Asia Pacific is experiencing steady growth with continued investments from AWS, Microsoft, Alibaba, and Facebook. Government agencies across several APAC countries are actively involved in developing data centers to digitalize their operations.

---

Competitive Landscape

---

Intense competition characterizes the global data center storage market, particularly as hyperscale operators increasingly opt for Original Design Manufacturer (ODM) infrastructure to fulfill their storage needs. On the other hand, Original Equipment Manufacturer (OEM) infrastructure is more commonly chosen for deploying on-premises storage infrastructure.

Cloud service providers engaged in rapid expansions and the establishment of additional cloud regions are the primary drivers of storage infrastructure procurement on a global scale. These operators acquire storage systems with varying performance levels, ranging from low to high.

Key players in the storage infrastructure market, such as Fujitsu, Huawei, IBM, HPE, NetApp, Pure Storage, and Dell Technologies, have a significant presence either directly or through reseller/distribution partners. Nvidia has collaborated with IBM and several universities in the US to develop an architecture known as Big Accelerator Memory (BAM), which establishes a direct link between storage and GPU, enhancing performance.

Oil and Natural Gas Corporation Limited (ONGC), an Indian oil and gas company, leverages Hewlett Packard Enterprise’s (HPE) GreenLake edge-to-cloud platform to host its SAP S/4HANA workloads. This platform enables ONGC to enhance performance, accelerate digitization, and gain improved insights through analytics.

Oulun Datacenter in Finland has embraced NetApp’s flash storage and expanded its existing NetApp-based FAS storage infrastructure to meet the evolving demands of its customers.

Key companies profiled in this report include Advanced Computer & Network Corporation, Bufallo, DataDirect Networks, Dell Technologies, FADU, Fujitsu, Hewlett Packard Enterprise, Hitachi Vantara, Huawei Technologies, IBM, Intel, Infortrend, Inspur, Kingston Technology, KIOXIA, Lenovo, Micron Technology, NEC, NetApp, Oracle, Pure Storage, Samsung Electronics, Seagate Technology, Solidigm, Toshiba, Viking Technology, VIOLIN, Western Digital, Wistron (WIWYNN), ZOTAC.

---

Key Questions Answered

---

What is the size of the global data center storage market?

The global data center storage market had a value of USD 48.73 billion in 2021 and is projected to reach USD 64.28 billion by 2027.

At what rate is the data center storage market growing?

The data center storage market is growing at a Compound Annual Growth Rate (CAGR) of 4.72% from 2022 to 2027, and it is expected to reach USD 64.28 billion by 2027.

Which region dominates the global data center storage market share?

North America is the leading market in terms of data center development and holds the largest share in the global data center storage market.

What are the factors driving the growth of the data center storage market?

The growth of hyperscale data center developments, increased adoption of AI and ML workloads, and the rise of cloud adoption are some of the key factors fueling the growth of the data center storage market.

Who are the major players in the global data center storage market?

Key players in the data center storage market include Bufallo, Dell Technologies, FADU, Fujitsu, Hitachi Vantara, Huawei Technologies, IBM, Intel, Infortrend, and Inspur.

What are the latest trends in the global data center storage market?

Some of the latest trends in the data center storage market include the adoption of 5G technology, advancements in storage media, and the increasing use of NVMe (Non-Volatile Memory Express) storage.