How Data Center Services Market Differs in Geographic Regions: Gartner

By Chris Preimesberger  |  Posted 2012-03-26

Depending upon where they are located in the world, enterprises are buying and using data center-related and cloud-based services very differently, researcher Gartner revealed March 26 in a new report.

While there's no question that relatively new services such as cloud computing infrastructure as a service (IaaS), platform as a service (PaaS) and infrastructure utility services (IUS) are trending up everywhere, various regions have their preferences about which ones they are using first.  

"Many events have affected the DCS market in the past two years, with symptoms of a traditional market at the tipping point from maturity to reinvention or decline," said Claudio Da Rold, vice president and distinguished analyst at Gartner. "Buyers in enterprise organizations must recognize the common usage patterns and differentiated levels of adoption of hosting vs. data center outsourcing, as well as the different business and market drivers toward new products."

North America Is the Client Adoption Leader
In North America, hosting (42 percent) and cloud IaaS have achieved the highest level of client adoption, while the markets in the rest of the world are dominated by data center outsourcing (80 percent), Gartner reported.

Other drivers across the global markets are economic growth and the buying trends of small or midsize businesses. Combined, these factors cause the DCS market to evolve at a different rate toward the new delivery models in the macro geographies, Gartner said.

Key Data Points 

North America: The data center outsourcing (DCO) market in North America amounted to $33 billion in 2011, while Web hosting and co-location combined for $23 billion. This market has the highest cloud adoption rate, with 60 percent of public cloud services worldwide, and the U.S. hosting market has continued to accelerate the pace of innovation and transformation.

The North American DCO/IUS market has grown both organically and through new offerings, such as storage as a service. Traditional DCO services growth continues at a slower pace than previously, due to IUS solutions and lower-price IT outsourcing (ITO) industrialized models, Gartner said. 

Europe: The DCO market in Europe totaled $38 billion in 2011, while Web hosting and co-location was way below North America, at $8.6 billion. Public cloud services adoption was at 23 percent.

The European market used to be fragmented by relatively small country markets, but since 2005, some of the larger outsourcers have implemented low-cost remote control centers. Later, they developed IUS offerings to benefit infrastructure utility for SAP€”particularly since 2008 and during the subsequent economic crisis, Gartner said.  

Asia/Pacific: There's not nearly as much activity in these markets as in North American and Europe. DCS in the region totaled $10 billion in 2011, while Web hosting and co-location were $2.5 billion, and public cloud services penetration was 9.8 percent in Japan and 3 percent elsewhere.

Additional information is available in the Gartner report "Regional Differences in the Move Toward the Cloud, 2012."

Chris Preimesberger is eWEEK Editor for Features and Analysis. Twitter: editingwhiz.

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