Data Center Market: By 2030, the market size could exceed 500 MW

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Data Center Market: By 2030, the market size could exceed 500 MW

PMR Forecasts, based on mapped investments by the largest providers as well as announcements and plans from new entrants, indicate that the capacity of Polish data centers will exceed 500 MW by 2030. Under a conservative scenario and a minimum plan—which assumes a phased approach to investments—approximately half of the projected capacity will be achieved by 2028.

The Data Center Market According to PMR Forecasts

The latest PMR Forecasts indicate that the implementation of plans by Poland’s largest data center providers could result in a maximum increase in commercial data center capacity of over 400 MW, up from approximately 120 MW in 2022. It should be emphasized that this is an optimistic scenario that does not account for the phased implementation of investments, which is typical for the market. A 7-year timeframe seems realistic, although the likelihood of each market player’s plans being realized varies and requires individual consideration.

We continue to expect a gradual increase in demand for colocation services in the country, as well as the emergence of new foreign customers on the market. The market will increasingly split into two segments: wholesale and retail. The market size—in terms of power and space supply in hyperscale data centers—will also grow.

Growth of the Data Center Wholesale Market

In practice, large investment projects already involve wholesale sales and securing contracts with customers even before the construction process is complete. In our view, the ongoing concentration of capital in Poland and the influx of new investors are by far the most significant drivers of market growth in the coming years, which will significantly boost revenue from data center services. It is impossible to assume that the entire list of major investment projects being implemented and planned by large investors is designed for anything other than generating an appropriate return on the funds allocated within a reasonable timeframe.

The list of data center service providers operating in Poland and focused on the wholesale market includes EdgeConneX, Vantage Data Centers, and Data4, as well as operators previously known mainly for serving the retail market (Atman, Equinix Poland).

The customers in the wholesale market are primarily the largest public cloud providers, namely AWS, Google, and Microsoft. Google already has a cloud region in Poland. Microsoft, on the other hand, officially launched its region on April 26, 2023, based on three autonomous data centers. Two of them were built and are operated exclusively for Microsoft by an external partner.

Warsaw’s Dominance

Warsaw accounts for over 60% of Poland’s total commercial server space. Nearly 10% of the net space is in Kraków, and 8% is in Poznań. Gdańsk has moved up the list of locations, having gained a new commercial facility last year thanks to 3S Data Center.

Based on the investments planned for the near future, it appears that Warsaw’s share will continue to grow. Warsaw generates by far the greatest demand for data center services, including colocation. However, it is also the most competitive and demanding market, where success depends on experience and a comprehensive service offering.

On the other hand, data centers in other locations play their own role, although the scale of such investments is different. In the context of the war in Ukraine, geographic redundancy is becoming increasingly important, as it ensures access to an alternative data center located much farther from the primary server room than the 15–20 km typical within the Warsaw metropolitan area. This trend is driven by the geopolitical situation.

The results of an analysis of the locations of the 40 largest commercial data centers confirm the dominance of Warsaw, which accounts for 25 of the 40 spots on the list of leading data centers as of early 2023

Corporate spending on data center services is on the rise

This year’s PMR survey shows that two-thirds of companies increased their spending on data center services in 2022 compared to 2021, and this percentage is expected to rise even further in 2023. Only 4% of companies plan to spend less on these services than they did in 2022.

In turn, the projected change in spending on services in 2023 varies depending on company size, but as many as 70% of companies plan to increase their spending again, with 24% of them intending to increase spending by more than 10%.

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