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London Data Center Market:Growing Landscape With Emerging Constraints

In the latest Market Spotlight from DC Byte, EMEA Managing Director William King and Senior Consultant Rupert Duckworth shed light on the dynamic London data center market.

London’s data center market stands out for its diverse ecosystem of dedicated “wholesalers,” such as VIRTUS Data centers, NTT, NGD (acquired by Vantage Data centers), and Ark Data centers. These players have been securing multi-megawatt deals from public cloud providers, making them key players in this thriving landscape.

Market Growth

As the second-largest data center market globally, London’s growth has been fueled by early adoption from the financial industry and strategic fiber optic connections, which led to significant development in locations like Slough. The rise of the public cloud has further accelerated the market, with The London Docklands and Slough in West London emerging as prominent submarkets, boasting a remarkable 521.52MW of live IT power.

The market has experienced remarkable growth, with supply doubling from 1,000MW in 2018 to 2,000MW in 2022. In 2022, over 180MW of take-up was recorded, driven by major players like Microsoft Azure, Google Cloud, and Amazon Web Services (AWS), fueling the demand for wholesale facilities.

Emerging Markets

Despite supply constraints, London’s data center market is projected to continue its growth trajectory. With established clusters facing limitations, hyperscalers and data center operators are increasingly turning their attention to emerging markets. These markets offer ample room for expansion and growth, providing strategic positioning for future scalability.

Apart from expansion opportunities, emerging markets also offer cost savings, making them attractive for long-term data center investments. Additionally, they contribute significantly to the economic development of local communities, generating job opportunities and attracting further technology investments. The strategic geographic locations of these emerging markets enable efficient service to nearby regions. This also diversifies data center operations and reduces risks associated with concentration in a single location. This has drawn the interest of hyperscalers and data center operators, anticipating a bright future for data center growth, innovation, and economic impact in these up-and-coming regions.

While London’s data center market presents immense potential, the supply constraints are driving hyperscalers and operators to explore emerging markets, positioning them for growth and innovation.

To read the full London Market Spotlight, click here, or to learn more about DC Byte, contact us at [email protected].

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