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Report: Cloud Data Services' Demand Driving Data Center Colocation Growth in Africa

July 14, 2017

A new report by Xalam Analytics, a Cambridge, Massachusetts based analytics firm focusing on the Middle East and Africa, says one of the fast-growing segments of the African ICT market is data center colocation. The rush to adopt cloud services and develop advanced digital applications is the primary driver behind that growth.

The report, titled “The African Data Center Rises – How the Race to the Cloud is Transforming African Colocation Markets” provides an analysis of the market for leasing data center space across 30 African countries. “The harbingers of this impending data center market growth have been building up for years”, according to the research firm. “African broadband is booming; fiber connectivity prices are declining, workload migration to the cloud is accelerating, data privacy and sovereignty concerns are gaining ground, and a new breed of consumer and enterprise digital natives are putting new demands on African Internet networks”.  

All these factors, the report says, are intensifying a race to “bring the brains of the Internet back on the African continent”. According to Xalam Analytics, the African colocation market is still small, but extremely promising. “The African data center market is around half the size of Amsterdam’s, and 3.5x smaller than London’s”, the research firm states. "It is a different type of colocation market, where facilities are smaller, market maturity levels are low and supporting infrastructure is often suboptimal.”

But the report also highlights the sector’s strong growth potential. “This is a market with substantial upside for those who will dare take it on” the researchers note. “We believe the market is at the very inception of a cloud-driven growth phase, the big cloud players are coming and overall macro indicators suggest there is room for material growth.”

 “We are bullish on African colocation revenue growth going forward”, the research firm states, noting that “African data center colocation revenue growth has averaged around 30% in US dollar terms, faster than the mobile market, and faster than top line B2B ICT revenue growth. That’s a pace many markets will continue to sustain.”  

More details on Xalam Analytics’ “The African Data Center Rises – How the Race to the Cloud is Transforming African Colocation Markets”  Report are available at www.xalamanalytics.com.

About Xalam Analytics

Xalam Analytics is a research and analytics firm focused on digital infrastructure and applications markets in Africa and the Middle East. The company combines local market insights, global industry expertise, and cloud-based BI analytics to offer in-depth BI tools and analysis of connectivity, hosting/cloud and IOT markets in the Africa Middle East region.

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