Data Center Switch Market Trends

Growth Drivers

• Growing Demand for Internet Connection – Data Center switches provide a bridge to build a network connection in a data center in order to send, and receive data from one place to another. Hence, growing demand for internet connections is estimated to increase the growth of the market in the upcoming years. As of January 2023, approximately 4 billion individuals used the internet, accounting for approximately 63 percent of the world's population.
• Rising Cloud Adoption – The data center switch is preferable for cloud providers that largely depend on virtualization. Furthermore, there has been an increasing adoption of cloud technologies, which is also expected to expand the market’s growth over the forecast period. Cloud services were used by around 93% of organizations in the United States in 2022. Nonetheless, in the same year, nearly 66% of enterprise infrastructure in the United States was cloud-based.
• Increasing Demand for Storage Solutions – The increasing demand for storage solutions owing to computing, and big data platforms is one of the major factors in the development of data centers. Thus, it is predicted to surge the growth of the global market. According to the most recent data, nearly 3% of the data generated and consumed in 2020 was saved globally and stored until 2021, indicating that only a small part of this newly created data is kept. The installed base of storage capacity is expected to grow at an annual average pace of around 18% between 2020 and 2025, in response to the large increase in data volume.
• Growing Demand for Efficient Energy Consumption – High speed is provided by the data center switches that reduce the consumption of energy. Moreover, a large volume of data is exchanged through the switches in the data centers, which further contributing for the efficient use of energy. Therefore, it is anticipated to rise the growth of the market in the upcoming years.  Many of the largest data centers in the world might house tens of thousands of IT devices each and require more than 99 megawatts (MW) of electricity, which is comparable to powering around 79,999 American households.

Challenges

• Lack of Advanced Data Center Infrastructure- There is a need for several technologies, such as cloud technologies, to be deployed in the data centers in order to make the data center more efficient. Moreover, there is a requirement for proper infrastructure that requires more resources, and is expected to hamper the growth of the market in the upcoming years.
• High Operational Cost for Data Center Switches
• Rising Government Regulations Regarding the Data Centers