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Data Centre Construction Market Report - UK 2018-2022

Published: 28/03/2018 / Number of Pages: 74 / Price: £845.00

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Introduction and Overview

The 4th edition of the report 'Data Centre Construction Market Report - UK 2018-2022' values the construction market for data centres and provides a thorough review of the structure and performance of the market from 2013 to 2022.

Key sections covered:

  • Review of market structure - data centre operators, ownership, customer groups, classification and data centre types.
  • Data centre construction market overview - state of the market, key sectors, mix between newbuild and RMI.
  • Market performance - market size in value terms, growth levels and forecasts to 2022.
  • Key influences - legislation & regulations, energy efficiency, government investment and strategy, shift to cloud computing etc.
  • Contracting and supply - corporate activity and major projects.
  • Key product sectors in data centre construction.

Areas of particular interest include:

  • Review of the commercial sector incorporating co-location and wholesale providers.
  • Government strategy regarding IT and take-up of cloud-based solutions.
  • Analysis of the main sectors, e.g. commercial, private and public including trends and construction output, projects and prospects.
  • Key trends and drivers in the data centre industry - the increasing adoption of cloud computing/services, virtualisation, data centre optimisation strategies, focus on whole life cost and energy efficiency and an increase in outsourcing etc.
  • Analysis of leading data centre operators/contractors and recent mergers & acquisitions.
  • Detailed market data and insight on the data centre construction market by AMA Research, a leading UK provider of construction market intelligence.

Some of the companies included:

2bm, AIT Partnership Group, Amazon Web Services, ARK Data centres, Balfour Beatty Group, Balfour Beatty, Briggs & Forrester Group, Buro Happold, Capitoline, CBRE Managed Services, Crown House Technologies Data Solutions, Crown House Technologies, Cundall, Digital Realty, Emcor Group (UK) Plc, Engie FM Ltd, ENGIE, Equinix, Facilitas TES, Future-Tech, Galloway Group, Gratte Brothers, Hewlett Packard (HP) Enterprise Data Centre Facilities Consulting Services Portfolio, Hilson Moran, HP Enterprise Services, Hurley Palmer Flatt, Imtech Technical Services, Infiniti IT, INS Sudlows, Integral UK, Interior Services Group, Interserve Construction Ltd, ITM Communications, KeySource, Lorne Stewart, Mace Construction, Michael J Lonsdale, Microsoft Data Centre Services, Mountfiel, PLC, NG Bailey Group Ltd, On365, Procol, Red Engineering, SES Ltd (Shepherd Engineering Services), Skanska Rashleigh Weatherfoil, SPIE Ltd, Spie Matthew Hall, SSE Contracting, StructureTone Mission Critical, T Clarke Plc, Waterman Group, Weatherite Building Services, Workspace Technology, WSP Parsons Brinckerhoff, and more.

Data centre industry overview and construction

  • The UK data centre industry - brief overview, development and structure.
  • Key trends and drivers in the data centre industry.
  • Market structure and classifications - delivery channels, customer groups, operators, data centre estate ownership structure, the Tier Standard and data centre types.
  • Data centre construction market overview - the state of the market, capacity, key sectors.
  • Market performance - market size in value terms, growth levels from 2013-2017 and growth projections to 2022.
  • Key trends influencing construction - growth in cloud computing, consolidation, energy efficiency / outsourcing, shift to co-location etc., UK locations and areas of demand.
  • Market mix - share of newbuild, upgrade/replacement and repair/maintenance.
  • Project characteristics - typical size, build time and cost, site selection and design issues.
  • Key product sectors - value of products in data centres, product mix, value by sector.

Key market drivers and influences

  • Review of past, current and future internet usage levels and trends in UK and Europe.
  • Analysis of current and forecast IP Traffic and types of Internet traffic.
  • Information about legislation and standards affecting the market. Review of government's data centre consolidation project, IT expenditure and strategy.
  • The impact of the growth in cloud computing and the use of virtualisation strategies.

Key market trends and influences

  • Review of past, current and future internet usage levels and trends in UK and Europe.
  • Analysis of current and forecast IP Traffic and types of Internet traffic.
  • Information about legislation and standards affecting the market. Review of government's data centre consolidation project, IT expenditure and strategy.
  • The impact of the growth in cloud computing and the use of virtualisation strategies. Analysis of the impact of IT outsourcing and review of recent market activity.

Key market sectors

  • Estimated output by value - historical trends and forecasts, in the commercial, public and private sectors - 2013-2022.
  • Market mix by end-use sector. Key market drivers, influences and prospects in each main market.
  • Project types, existing stock, key construction clients and major projects in each sector.
  • Private sector market - key sub-sectors, influences in each, key clients.
  • Commercial sector - wholesale, co-location and managed services providers, trends etc.
  • Public sector market - government IT spend by function and by department.

Suppliers and contractors

  • Consultants - procurement process, the role of consultants, key consultants.
  • Contractors - types of contractors, leading companies, mergers & acquisitions.
  • Products in data centres - review of each major product sector, including value, important market influences and key suppliers. Includes power and electrical equipment, cooling and air conditioning, networking equipment, security, access control and fire protection.

Report Summary

The market for data centre construction has experienced growth from 2015 onwards. The market performance has been positive in recent years, with a strong take up of space within the co-location sector from late 2015 onwards. The commercial sector has experienced the greatest level of growth, boosted my major data investments from global players in the past two years. In contrast, expenditure in the public sector has fallen slightly as the Government's cloud-first policy has led to increased outsourcing and use of wholesale and co-location providers to reduce its IT expenditure.

In 2016 and 2017, the data centre construction market benefitted from major investment decisions from Amazon Web Services, Microsoft and IBM. In 2017, Google opened a data centre in London to improve its cloud offering. In addition, there are several major new data centres being developed across the UK, which should provide further impetus to the market in the next year or two.

Demand for data storage is being driven by the increasing levels of online activity, huge growth in the number of connected devices and changes in the way online services are delivered, with a growing adoption of cloud computing technology. Increasing cloud take-up is supporting the growth of the commercial and co-location sector, as it reduces the need for businesses to own and maintain their own IT infrastructure.

In terms of contractors, the data centre market is very fragmented. While most large M&E contracting businesses are key players, companies involved in data centre construction range from major building contracting groups and commercial developers, to data centre specialists and operators, modular building manufacturers and IT equipment suppliers.

Going forward, indications are that construction output within the data centre sector will rise consistently from 2018 onwards, driven by steady overall construction output, but primarily by underlying factors driving greater IT and internet usage. The commercial sector is expected to drive construction growth, while the trend towards outsourcing data centre services from both the public sector and private businesses is likely to lead to relatively modest growth in these sectors.


List of Report Contents

  1. Contents Listing
  2. 1. INTRODUCTION 7
  3. 1.1 INTRODUCTION 7
  4. 1.2 SOURCES OF INFORMATION 7
  5. 1.3 GLOSSARY 8
  6. 2. EXECUTIVE SUMMARY & MARKET PROSPECTS 9
  7. 2.1 SUMMARY 92.2 MARKET PROSPECTS 10
  8. 3. ECONOMIC ENVIRONMENT 12
  9. 3.1 GDP 12
  10. 3.2 INFLATION & INTEREST RATES 13
  11. 3.3 UNEMPLOYMENT 14
  12. 3.4 HOUSEHOLD CONSUMPTION 15
  13. 3.5 HOUSING & CONSTRUCTION 15
  14. 3.6 STERLING 16
  15. 3.7 POPULATION PROFILE 16
  16. 3.8 CONCLUSIONS 17
  17. 4. UK DATA CENTRE INDUSTRY OVERVIEW 18
  18. 4.1 INDUSTRY OVERVIEW 18
  19. 4.2 THE TIER STRUCTURE 19
  20. 4.3 DATA CENTRE MARKET STRUCTURE 20
  21. 5. THE CONSTRUCTION MARKET FOR DATA CENTRES 23
  22. 5.1 DEFINITION 23
  23. 5.2 MARKET OVERVIEW 23
  24. 5.3 MARKET SIZE 24
  25. 5.3.1 Market Size and Trends 24
  26. 5.3.2 Market Prospects 26
  27. 5.4 MARKET MIX 28
  28. 5.5 CHARACTERISTICS OF DATA CENTRE CONSTRUCTION PROJECTS 29
  29. 5.5.1 Background 29
  30. 5.5.2 Design 29
  31. 5.5.3 Key Components 30
  32. 5.5.4 Cost 31
  33. 5.5.5 Site Selection 32
  34. 6. KEY MARKET DRIVERS 34
  35. 6.1 INTERNET USAGE LEVELS 34
  36. 6.1.1 IP and Internet Traffic 34
  37. 6.1.2 Broadband Availability and Take-Up 36
  38. 6.1.3 Public Wi-fi and Mobile Data 36
  39. 6.2 LEVELS OF IT OUTSOURCING 37
  40. 6.3 GROWTH IN CLOUD COMPUTING 39
  41. 6.4 DATA CENTRE OPTIMISATION STRATEGIES 40
  42. 6.5 LEGISLATION & STANDARDS 41
  43. 6.6 CARBON REDUCTION & GREEN ENERGY REQUIREMENTS 43
  44. 6.7 INNOVATION & MODERN METHODS OF CONSTRUCTION 45
  45. 7. KEY MARKET SECTORS 47
  46. 7.1 OVERVIEW 47
  47. 7.2 COMMERCIAL PROVIDER SECTOR 48
  48. 7.2.1 Wholesale Providers 51
  49. 7.2.2 Co-location Providers 52
  50. 7.2.3 Hosting/ Cloud /Managed Service Providers 54
  51. 7.3 PUBLIC SECTOR 55
  52. 7.3.1 UK Government IT Spend and Data Centre Estate 56
  53. 7.3.2 UK Government ICT Strategy 57
  54. 7.4 PRIVATE SECTOR 59
  55. 7.4.1 Background 59
  56. 7.4.2 Financial Services 60
  57. 7.4.3 Online Retail & Leisure 61
  58. 7.4.4 Telecoms Providers & ISPs 62
  59. 7.4.5 Broadcasting, Content Providers & Social Media 63
  60. 8. SUPPLIERS, CONTRACTORS AND PRODUCTS 64
  61. 8.1 KEY CONTRACTORS & CONSULTANTS 64
  62. 8.1.1 Data Centre Consultants 64
  63. 8.1.2 Building Contractors 64
  64. 8.1.3 M&E and IT Contractors 65
  65. 8.1.4 Specialist Contractors 67
  66. 8.2 KEY PRODUCT SECTORS IN DATA CENTRE CONSTRUCTION 69
  67. 8.2.1 Overview 69
  68. 8.2.2 Power, Cabling and Electrical 70
  69. 8.2.3 Cooling & Air Conditioning 72
  70. 8.2.4 Security & Access Control 73
  71. 8.2.5 Fire Protection 74
  72. 8.2.6 Other Products 74
  1. Tables & Charts
  2. CHART 1: UK MARKET FOR DATA CENTRE CONSTRUCTION 2013 TO 2022 - BY VALUE (£MILLION) 9
  3. TABLE 2: GDP DATA - 2015-2017 - KEY CONSTITUENT ELEMENTS 12
  4. CHART 3: INTEREST RATES AND INFLATION (CPI) FROM 2000-2022 14
  5. CHART 4: PDI & SAVINGS RATIO AT CURRENT PRICES 2000-2022 15
  6. TABLE 5: EXCHANGE RATE FLUCTUATIONS 2014-2020 - STERLING TO THE DOLLAR, AND THE EURO, SPOT RATES 16
  7. TABLE 6: OVERVIEW OF THE TIER STANDARD 20
  8. CHART 7: MARKET STRUCTURE FOR DATA CENTRE SERVICE DELIVERY 21
  9. CHART 8: OWNERSHIP BY TYPE OF ORGANISATION - % BY FLOORSPACE 2017 22
  10. TABLE 9: UK DATA CENTRE CONSTRUCTION MARKET 2013 TO 2022 BY VALUE (£M) 24
  11. CHART 10: MARKET MIX BY TYPE OF WORK UNDERTAKEN (NEW BUILD, RMI, REFURBISHMENT) - % BY VALUE 2017 28
  12. CHART 11: DATA CENTRE BUILD COST BREAKDOWN - % BY VALUE 2017 32
  13. TABLE 12: IP/INTERNET TRAFFIC FORECASTS UK 2016-2021 34
  14. CHART 13: % SHARE OF IP TRAFFIC BY TYPE OF DEVICE, UK - 2016 TO 2021 35
  15. TABLE 14: MAJOR EUROPEAN ECONOMIES - INTERNET ACCESS, TAKE-UP AND DATA USAGE 2016 35
  16. TABLE 15: BROADBAND AND INTERNET STATISTICS UK 2015-2017 36
  17. TABLE 16: MOBILE DATA STATISTICS UK 2015-2017 37
  18. CHART 17: MIX BY SERVER TYPE - % BY VOLUME 2017 41
  19. CHART 18: CONSTRUCTION MARKET MIX BY CLIENT (PUBLIC, PRIVATE, COMMERCIAL) % BY VALUE 2017 47
  20. CHART 19: DATA CENTRE CONSTRUCTION MARKET - COMMERCIAL PROVIDER SECTOR 2013- 2022 (£M) 49
  21. TABLE 20: RECENT PROJECT ANNOUNCEMENTS - COMMERCIAL SECTOR 50
  22. CHART 21: CO-LOCATION FACILITIES CLIENT MIX - % BY VOLUME 2017 53
  23. CHART 22: DATA CENTRE CONSTRUCTION MARKET - PUBLIC SECTOR 2013-2022 (£M) 55
  24. TABLE 23: SELECTED UK GOVERNMENT DEPARTMENTS ICT SPEND - BY VALUE 2015/16 57
  25. CHART 24: DATA CENTRE CONSTRUCTION MARKET - PRIVATE SECTOR 2013-2022 (£M) 59C
  26. HART 25: UK ONLINE BANKING PENETRATION - % OF ADULTS 2009- 2017 61
  27. TABLE 26: E-COMMERCE PENETRATION RATES IN THE UK 2009-2017 - % OF UK ADULTS 62
  28. CHART 27: USAGE OF INTERNET - % OF UK ADULTS 2017 63
  29. TABLE 28: TOP M&E CONTRACTORS IN THE UK BY M&E TURNOVER 66
  30. CHART 29: DATA CENTRE CONSTRUCTION PRODUCT MIX - % BY VALUE 2017 69
  31. TABLE 30: VALUE OF PRODUCT SECTORS USED IN DATA CENTRE CONSTRUCTION BY VALUE 2017 70
  32. CHART 31: POWER & ELECTRICAL - PRODUCT MIX BY VALUE 2017 (%) 71
  33. CHART 32: SECURITY SYSTEMS - PRODUCT MIX BY VALUE 2017 (%) 74

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