Description
The global data centre colocation and interconnection market continues to show steady and consistent levels of performance and has painstakingly moved past the turbulence and unsteadiness of the last several years. There are still challenges and potential headwinds, particularly around resource constraints, but the sector now sits at the doorstep of a sustained period of accelerated growth. AI is the driving force. It is set to create a new generation of applications that require not just higher volumes of capacity, but three separate tiers of infrastructure. AI infrastructure is set to be deployed across core training models, fine tuning and inferencing, with the last two tiers being a very good fit with the data centre colocation and interconnection model. All of this is set to be net new additions to the ecosystem and importantly, have a limited cannibalizing effect on existing infrastructure.
What sometimes gets lost in the discussion is the fact that hyperscale cloud is the natural delivery vehicle for AI technology. The hyperscale clouds are seeing rapid increases in AI adoption on their cloud infrastructure platforms and organizations are accelerating migration initiatives. Data and workloads are moving from on-premise installations and landing on public cloud and in data centre colocation environments that interconnect easily to clouds. Hyperscale cloud is still the colocation sector’s main driver of growth and AI is acting as an accelerant, impacting nearly all segments across the industry.
As the sector picks up pace, and hyperscalers and operators build out aggressively, there has been a rise in bearish sentiment, with fears of an overbuild situation developing. Events like the DeepSeek learning model revelations and hyperscale pullbacks in certain markets caused significant consternation and worries. But the fact is that there are plenty of reasons to believe this view is wrongheaded. CapEx levels remain high, hyperscalers continue to report demand levels exceeding supply, and the growth of hyperscale cloud has shown acceleration over the last several quarters. Meanwhile, AI continues to push value through the ecosystem as both an incentive to outsource and a source of net new workloads.
Picking up where we left off last year, the sector continues to show momentum and the hints that things will start to accelerate are becoming reality. The data centre colocation market was estimated to be worth USD $109.5b in 2024, a figure that represented 21.25% y/y growth. Looking ahead to 2025, the market is expected to continue on this upward trajectory, growing 18.1% y/y to $119.2b, and then growing 23.3% to $146.9b in 2026. This marks a significant uptick from recent years and reflects the current demand profile and undercurrent of momentum. The numbers are all up from our previous market projections, while we emphasise that our methodology tries to carefully take into account the gaps that emerge between demand, uptake and materialization.
This report also includes global data centre colocation inventory on a MW basis and market share data for interconnection. The market share analysis is supported by detailed regional breakdowns for four major regions: APAC, North America, EMEA and Latin America. We also include inventory estimates (on a MW basis) for major markets in all four regions along with a maturity index that maps out current and emerging markets. Finally, we provide a summary of regional market dynamics and analysis of colocation consumption and landscape trends. Regional variations within these trends are also discussed.
The Global Colocation Market Share Report remains the most comprehensive dataset on the global data centre colocation market and an indispensable resource for any service provider, investor or end user looking to understand and project the future of the market or find a service provider. This latest refresh reflects our more granular view of the landscape, which produces deeper insights into markets in the top tier and better visibility into all corners of this global market, while accounting for the significant changes created by the rise of AI demand and the rapidly increasing constraints around land and power availability. This report also has two sister reports: 1)The Hyperscale Self-Build Report (already published in 2025); and 2) The AI Infrastructure Market Share Report (forthcoming).
