Data Center infrastructure spending believed to recover from 2021

Data center investment took an important toll with the spread of the pandemic. However, it is believed the spending will increase from 2021 and grow throughout 2024.

According to Gartner, end-user data centre infrastructure spending worldwide should have a 6% increase in 2021 after 60% of planned construction projects have been put on hold in 2020, leading to a 10,3% decrease in data centre spending.

Most companies are encouraged to slow down their data centre growth until the market recovers. Hyperscalers, massive data centres, which are designed to develop quickly, however, won’t be able to slow down due to the increased investment in public cloud services.

Yet, the growth predicted by Gartner still won’t bring the spending back to where it was before the pandemic. Indeed, in 2019, $210 billion were spent worldwide while in 2020, it will most likely only be at $188 billion. 2021 should bring $200 billion, which is still quite low compared to 2019. It is hoped that there will be positive growth throughout 2024.

As for now, all data centre infrastructure segments are subjected to cost containment measures and enterprise buyers will have to extend life cycles of installed equipment. Having physical staff available on staff remains vital for an increase in data centre spending, thus threatening the growth.

Despite all of this, Gartner offers three recommendations for data centre managers looking to recover their infrastructure growth: have the CFO and head of procurement to work together on cost optimisation in the data centre; craft a playbook to help leaders understand the impact of the pandemic on the industry and the actions needed as a result; finally, invest in a new go-to-market strategy aimed at using digital natives to enhance innovation such as hybrid IT and use-based pricing for infrastructure needs.