Cloud Service Providers to Revert from Capacity Consumption to Expansion by 2020, According to Dell'Oro Group

Cloud Data Center Capex Forecasted for Double-Digit Growth Next Year

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Sep 19, 2019, 08:00 ET

REDWOOD CITY, Calif., Sept. 19, 2019 /PRNewswire/ -- According to a recently published report from Dell'Oro Group, the trusted source for market information about the telecommunications, networks, and data center IT industries, Cloud service providers will revert from capacity consumption to expansion by 2020. This change will drive Cloud data center capex to double-digit growth next year as the major Cloud service providers expand data center footprints in new and existing regions.

"As we had forecasted, some of the major Cloud service providers are reducing their data center capex in 2019 as they continue to consume excess server capacity," said Baron Fung, Director at Dell'Oro Group. "However, we anticipate that the top 10 Cloud service providers will bring more than 40 new regions on line over the next 12 months. Spending on new servers and networking equipment are expected to ramp and drive Cloud data center capex to higher growth in 2020," explained Fung.

Following are additional highlights from the 2Q 2019 Cloud Data Center Capex Quarterly Report:

The Top 10 Cloud service providers spent $6.9 billion in aggregate on data centers.
The Top 4 U.S.-based Cloud service providers–Amazon, Facebook, Google, and Microsoft–had an 80 percent share of the data center capex of the Top 10 Cloud SPs.
Amazon leads all Cloud service providers with the most regions in operation, followed by Google and Microsoft.

About the Report
Dell'Oro Group's Cloud Data Center Capex quarterly report includes detailed capital spending of each of the largest ten Cloud service providers on data centers and servers, the number of regions and availability zones for each Cloud service provider, as well as the number of installed servers. The report also discusses market trends and drivers of leading Cloud service providers' capex growth during the quarter and the outlook for the next year. To purchase this report, please contact us at [email protected].

About Dell'Oro Group
Dell'Oro Group is a market research firm that specializes in strategic competitive analysis in the telecommunications, networks, and data center IT markets. Our firm provides in-depth quantitative data and qualitative analysis to facilitate critical, fact-based business decisions. For more information, contact Dell'Oro Group at +1.650.622.9400 or visit www.delloro.com.

SOURCE Dell'Oro Group