South Korea Data Center Market Size by Investment to Reach USD 5.25 Billion by 2026 - Arizton

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Oct 13, 2021, 11:00 ET

CHICAGO, Oct. 13, 2021 /PRNewswire/ -- In-depth analysis and data-driven insights on the impact of COVID-19 included in this South Korea data center market report.

South Korea data center market size is expected to grow at a CAGR of over 7.72% during the period 2020−2026. South Korea data center market research report includes market size in terms of area, investment, power capacity, and colocation revenues. Get insights on 33 existing and 5 upcoming facilities spread across 12 cities, including Seoul and Other Cities (Anyang, Busan, Cheongju, Daegu, Gimhae, Gimpo, Goyang, Guro, Gwangju, Incheon, and Seongnam).

Key Highlights Offered in the Report:

1. South Korea is an emerging data center market in APAC. South Korea has a geographical advantage due to its proximity to China and lower occurrence of natural disasters than Japan, Indonesia, and the Philippines.

2. According to Korea Data Center Council (KDCC) there are over 150 data center sites in the country. Seoul is a major market in the country, with 12 third-party colocation facilities contributing to over 80% of the existing power capacity. Seoul is followed by Incheon, Gyeonggi and Gangwon in terms of data center development.

3. Digital Realty, Equinix, KT, Telehouse, and LG Uplus are a few prominent colocation operators in South Korea. The market is witnessing upcoming investments from Digital Realty, Naver, SOLIS IDC, NHN, and Kakao Corp, among others, that will contribute to market growth.

4. Data localization laws mandate local companies only to operate data centers and provide services to public institutions. This factor expects to boost the increase the demand for local data center facilities in South Korea.

5. South Korean ICT companies are consistency investing in AI-based technology in the country. Technology giants such as Samsung and LG Electronics are a few companies that are leading the race. SK Telecom and KT, which are telecommunications companies are not far behind.

6. In 2020, the overall power mix in South Korea consisted majorly of fossil fuels, contributing around 60% to the electricity generated, with coal, and nuclear power contributing over 35%. In 2020, the South Korean government announced its energy plan that aims to generate 40% of electricity from renewable energy sources by 2034.

Key Offerings:

Market Size & Forecast by Area, Power Capacity, Investment, and Colocation Revenue | 2020-2026
Impact of COVID-19 on Data Center Market
Snapshot of existing and upcoming third-party facilities in South Korea

Facilities Covered (Existing): 33
Facilities Identified (Upcoming): 5
Coverage: 12 cities
Existing vs. Upcoming (Data Center Area)
Existing vs. Upcoming (IT Load Capacity)

Data center colocation market in South Korea

Market Revenue & Forecast (2020-2026)
Retail Colocation Pricing
Wholesale Colocation Pricing

Market Dynamics – Leading trends, growth drivers, restraints, and investment opportunities
Market Segmentation – A detailed analysis by IT infrastructure, electrical infrastructure, mechanical infrastructure, general construction, and tier standard
Key Market Participants – List of 10 IT infrastructure providers, 7 construction service providers, 13 support infrastructure providers, and 4 data center investors

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South Korea Data Center Market – Segmentation

The server Infrastructure market in South Korea expects to grow with increased data center investments. The server market in South Korea is estimated to receive an investment of USD 1.8 billion by the end of 2021. Hyperscale data center expansions are likely to increase the demand for servers and promote the procurement of high-performance infrastructure solutions.
Lead acid battery is widely adopted by data center operators in the country. According to Korea Data Center Council (KDCC), over 65% of data centers on South Korea adopt lead acid battery, followed by over 20% of data center operators installing lithium-ion batteries.
South Korea data center providers support free cooling techniques for majority of the time in a year. According to the Korea Data Center Council (KDCC), air-based cooling is adopted by over 40% of the data center operators in the country.

Market Segmentation by IT Infrastructure

Servers
Storage Systems
Network Infrastructure

Market Segmentation by Electrical Infrastructure

UPS Systems
Generators
Transfer, Switches & Switchgears
Rack PDUs
Other Electrical Infrastructure

Market Segmentation by Mechanical Infrastructure

Cooling Systems
Rack Cabinets
Other Mechanical Infrastructure

Market Segmentation by General Construction

Building Development
Installation & Commissioning Services
Building Design
Physical Security
Data Center Infrastructure Management (DCIM)

Market Segmentation by Tier Standard

Tier I & Tier II
Tier III
Tier IV

South Korea Data Center Market – Dynamics

The cloud computing market in South Korea is growing rapidly and expects to generate revenue of over USD 2.5 billion by 2021. South Korea ranked fifth in the 2020 Cloud Readiness Index released by the Asia Cloud Computing Association. South Korea has the presence of both local and global cloud services providers, including Amazon Web Service (AWS), Oracle, Microsoft, Google, KT, LG CNS, SK C&C among others. The outbreak of the COVID-19 pandemic has boosted cloud adoption in the country, with public and private enterprises and educational institutions adopting cloud platforms. In 2020, the South Korean government announced to shift entire systems used by government agencies to the cloud by 2025. Around 77% of government agencies expect to choose public cloud services and the remaining opting for private cloud services. By 2023, Software as a Service (SaaS) expect to lead the cloud market, accounting over 40% of the market, followed by Infrastructure as a Services (IaaS) segment. In 2021, SK C&C agreed to merge digital platform and solutions for industries based on Multiverse (Korea's leading SaaS model by SK C&C) with the Google cloud to enhance the software as a service (SaaS) model. In 2020, Google launched its first cloud region in the country, and Oracle launched its second cloud region in Chuncheon, South Korea.

Key Drivers and Trends fueling Market Growth:

Increasing Internet and Social Media Users impacting Data Center Investments
Implementation of Big Data Services and IoT driving Data Center Investments
COVID-19 Pandemic Impacting on Data Center Investments
5G and Smart Cities Initiatives Leading Data Center Deployment

South Korea Data Center Market - Existing Vs. Upcoming Data Centers

Existing Facilities in the region (White Floor Area and Power Capacity)

Seoul
Other Cities

List of Upcoming Facilities in the region (White Floor Area and Power Capacity)

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Key Market Participants

IT Infrastructure Providers

Arista Networks
Atos
Cisco Systems
Dell Technologies
Fujitsu
Hewlett Packard Enterprise (HPE)
IBM
Inspur
Lenovo
NetApp

Construction Constructors & Sub-Contractors

BEHIVE Architects
DPR Construction
GS E&C
HanmiGlobal
ISG
Posco ICT
Samoo Architects & Engineers

Support Infrastructure Providers

ABB
Caterpillar
Cummins
Delta Electronics
Eaton
Fuji Electric
Legrand
Rittal
Mitsubishi Electric
Piller Power Systems
Rolls-Royce Power Systems
Schneider Electric
Vertiv Group

Data Center Investors

Digital Realty
KT
LG Uplus
Lotte Data Communication

Explore our data center knowledge base profile to know more about the industry.

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About Arizton:

Arizton Advisory and Intelligence is an innovation and quality-driven firm, which offers cutting-edge research solutions to clients across the world. We excel in providing comprehensive market intelligence reports and advisory and consulting services.

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SOURCE Arizton Advisory & Intelligence