Data Center Investment Tracker: 1Q22

Multiple types of companies are investing heavily in data center assets. Two years ago, the data center market was already vibrant, but COVID-19 gave this a boost as enterprises accelerated digital transformation efforts, and multiple sectors (enterprise, government, education…) moved many activities to the cloud. As a result, data center investment has boomed. This investment is coming from multiple sources: webscalers, carrier-neutral operators, telcos, a broad range of asset management specialists aiming to benefit from growing DC demand. With this investment, the market is seeing consolidation and the emergence of new business models. Meanwhile, the technologies deployed in the data center are evolving rapidly. Vendors are creating new products and customizing old ones in order to cater to the data center. Even if you’re steeped in the data center world, it can be hard to keep up. This “Data Center Investment Tracker” provides an up-to-date synthesis of this investment and technology activity.
 
This is the second edition of our data center investment tracker, covering developments through April 2022. The scope of coverage has been expanded considerably since the first edition, and we have added a new section addressing energy topics. The report includes the following sections:
 
Footprint: a summary of the data center footprint, energy usage, and major projects underway of all key webscale and carrier-neutral network operators, and a few large telcos with data center holdings. In total, 52 companies are included, from 27 last quarter.
 
Capex: capital expenditures (capex) recorded from 1Q11-4Q21 by the big spenders driving the data center market – webscale and carrier-neutral operators. In total, capex information is included for 31 companies with data center holdings. Capex for these companies was $177.3 billion (B) in 2021, up 29% from 2020. A large portion of this capex was dedicated to data center construction and operation.
 
Vendor contracts: a database of 281 contracts between data center operators and vendors, cutting across many different categories of technology, in particular: servers (and the chips that run them), switches, routers, storage, security, optical interconnect, software, and power/cooling. The database attempts to be comprehensive for January 2020 through early May 2022.

Asset management: mini-profiles of 40 (from 30 last quarter) asset management & real estate companies with active interests in data centers, summarizing their approach to data center investment, major holdings, and recent developments.
 
Mergers & acquisitions: a summary of 73 significant M&A transactions involving the data center market, focusing on 2020 to early May 2022. The database includes 15 deals announced in 2022, which account for total deal value of $16.8B. The largest three deals in 2022 to date are: the joint bid by DigitalBridge and IFM Ventures to take Switch private, for $11B; Digital Realty’s $3.5B acquisition of 55% of Teraco, a South Africa-based CNNO; and, Equinix’s $705M acquisition of 4 data centers from South American telco, Entel.
 
Energy: for most of the large data center operators, this tab addresses overall energy consumption, energy spending, the shift to renewables, and data center efficiency (i.e. PUE).

All information is current as of early May 2022, with one exception: capex data is through the December 2021 reporting period (4Q21). However, when available we have summarized more recent guidance from each company on 2022 capex plans.