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Data Center Outsourcing Market Report Overview
The global data center outsourcing market was valued at USD 182.05 Billion in 2025. The market is expected to grow at a CAGR of 5.10% during the forecast period of 2026-2035 to reach a value of USD 299.38 Billion by 2035. Rising investments in large-scale data center infrastructure and capacity expansion by service providers to support growing enterprise and hyperscale computing demand are driving the growth of the market.
Latest News on the Data Center Outsourcing Market (2026)
April 2026: AI Capacity Crunch Drives Record Outsourcing Pipeline
Through April 2026, hyperscalers and enterprises continued shifting workloads to colocation and managed data centre operators amid persistent AI-driven power and capacity constraints. The Financial Times reported that European and US enterprises have moved from build-versus-buy debates to multi-year outsourced GPU and high-density colocation contracts to meet generative AI deployment timelines.
March 2026: European Power Constraints Reshape Outsourcing Strategy
Grid connection delays and tightening energy efficiency rules continued shaping European data centre outsourcing decisions through March 2026, with operators in Frankfurt, Amsterdam, London, Paris and Dublin balancing power availability with sustainability mandates. Coverage in Bloomberg highlighted that customers are increasingly anchoring outsourced capacity in Nordic and Iberian markets where renewable supply is plentiful.
Key Market Trends and Insights
- Rising AI workloads are accelerating demand for outsourced high-density and scalable data center infrastructure.
- Enterprises increasingly prefer colocation services to reduce capital expenditure and improve operational flexibility.
- Growth in hybrid cloud adoption is driving demand for integrated managed data center outsourcing solutions.
Market Size & Forecast
- Market Size in 2025: USD 182.05 Billion
- Projected Market Size in 2035: USD 299.38 Billion
- CAGR from 2026 to 2035: 5.10%
The global data center outsourcing market trends include an increased demand for scalable IT infrastructure to accommodate AI, cloud, and computing-intensive applications, compelling companies to outsource their requirements from external sources rather than developing the required infrastructure at their own data centers. In addition to this, the trend of improving operational efficiency and achieving cost-efficiency by adopting colocation and managed data center services is further encouraging companies to utilize outsourced data center infrastructure, allowing them to get rid of expensive investments in their own data center infrastructure.
Apart from this, the data center outsourcing market is observing tremendous growth due to the rising investments by providers into extensive infrastructure projects and facility expansions in order to meet increasing demands from enterprises in relation to cloud-based and artificial intelligence applications. As digital transformation accelerates in most industries, enterprises have become more willing to outsource their data centers in order to get scalable infrastructure without investing heavily in building one themselves. To meet rising workload demands, data centers are now undertaking massive campus projects and expansion of operations.
To cite an instance, DataBank unveiled plans to build a new data center complex with a capacity of 480 MW in South Dallas, United States, in September 2024. The company intended to serve large cloud companies and enterprises amid growing demand for digital facilities. Similarly, atNorth revealed that it had made efforts to expand its ICE02 and ICE03 data centers located in Iceland, to accommodate more high-performance and AI workloads. These kinds of initiatives are improving global infrastructure outsourcing capabilities, meeting rising demands for enterprise data processing.
2025
Base Year
2019-2025
Historical Period
2026-2035
Forecast Period
Compound Annual Growth Rate
5.1%
Value in USD Billion
2026-2035
*this image is indicative*
Key Trends and Recent Developments
Rising Complexity of Enterprise IT Infrastructure Driving Outsourcing Demand
Rising complexity in enterprise IT, driven by hybrid cloud, big data, and advanced analytics, is pushing companies to rely on service providers for infrastructure management. The platforms that service providers are building enables the enterprises in search of scalable data centers to adopt them, which, in turn, boosts demand in the data center outsourcing market. For example, in May 2024, Flexential upgraded its FlexAnywhere platform with a high-density data center in Denver, aimed at offering hybrid IT and colocation solutions.
Growing Demand for AI and High-Performance Computing Infrastructure
The rapid adoption of AI and big data technologies is surging the demand for computing infrastructure, prompting businesses to outsource their data center functionalities to professionals. Most of the data center outsourcing market players are teaming up with technology firms to construct AI infrastructures that can handle high-performance computing jobs, further contributing to the market expansion. For instance, in December 2024, Zettabyte formed a partnership with Foxconn to construct AI data center solutions that are energy efficient, with the use of Zware software that enhances GPU efficiency.
Strategic Partnerships Enhancing Data Center Infrastructure Deployment
Data center operators and tech firms are strategically collaborating, which is helping them to advance the deployment of infrastructure and services capabilities. By collaborating with each other, organizations are able to bring in advanced technology solutions for power generation, cooling, and modular data centers, thus enabling outsourcing providers to provide scalable infrastructures to their enterprise customers. For example, in November 2023, Schneider Electric entered into an agreement worth USD 3 billion for the supply of modular data center infrastructures systems to Compass Datacenters.
Expansion of Data Center Infrastructure in Emerging Digital Markets
Digitalization in emerging nations is increasing demand for reliable digital infrastructure, prompting global data center providers to expand and capture new market opportunities. Through regional investments in infrastructure development, outsourcing companies are now facilitating local availability of scalable hosting and cloud infrastructure services. For instance, in May 2024, DAMAC introduced their EDGNEX Data Centres with an investment of 15 MW in Jakarta, Indonesia, for the benefit of the region’s thriving digital economy. This geographical shift in investment is impacting the data center outsourcing market positively.
Expansion of Edge and Regional Data Center Infrastructure
The increasing demand for low latency computing as well as localized digital solutions is leading to an increase in investments in edge computing and regional data center infrastructure. Organizations are increasingly depending on service providers who offer distributed infrastructure that can support edge computing, cloud connectivity, and regional data centers. For example, DRFortress successfully completed a new expansion at its Honolulu data center campus in May 2023, providing additional capacity as well as colocation cabinets for regional and cloud networking companies.
Global Data Center Outsourcing Industry Segmentation
The EMR’s report titled “Global Data Center Outsourcing Market Report and Forecast 2026-2035” offers a detailed analysis of the market based on the following segments:
Market Breakup by Services
- Co-Location Hosting
- Managed Hosting
- Others
Key Insight: The data center outsourcing market scope comprises services like co-location hosting, managed hosting, and other forms that cater to the varying demand for scalable infrastructures. The growth of co-location hosting results from the growing companies’ demands for cost-effective infrastructure without having to own their facilities, leading to the creation of new data centers and expansion to different regions. For example, ServerMania opened up a new dedicated hosting and colocation data center facility in Amsterdam in August 2024. Meanwhile, the managed hosting is gaining traction as firms rely on third parties to manage their IT infrastructure and maintenance needs.
Market Breakup by Segment
- Retail
- Wholesale
Key Insight: The data center outsourcing market value is significantly driven through within retail and wholesale categories due to increasing dependence on infrastructure service providers. In the retail category, growth is driven by the increasing demand from companies needing colocation services in small quantities. The wholesale category is experiencing notable growth as hyperscale cloud operators and prominent corporations are looking for high-capacity space on lease terms. Players such as Digital Realty and Equinix Inc. are expanding their hyperscale and retail colocation capacity respectively.
Market Breakup by End Use
- Small and Medium Businesses
- Large Businesses
Key Insight: The data center outsourcing market caters to SMBs and large corporations. SMEs are mainly dependent on outsourced data center facilities in order to minimize costs, improve IT service dependability, and gain access to business-grade hosting capabilities without the need to develop internal resources. Meanwhile, large corporations are now opting for outsourced facilities when it comes to high performance computing, hybrid cloud infrastructures, and mission critical tasks. Organizations like IBM Corporation and Rackspace Technology are now offering more managed infrastructure and hybrid cloud solutions.
Market Breakup by Region
- North America
- Europe
- Asia Pacific
- Latin America
- Middle East and Africa
Key Insight: Regionally, the data center outsourcing market landscape is fueled by infrastructural investment and digital transformation strategies from North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa. North America and Europe continue to be mature markets owing to the growth of hyperscale cloud infrastructure, while Asia Pacific has emerged to be a high potential region owing to the growth of AI infrastructure. For instance, in March 2026, Bridge Data Centers planned to invest heavily in Singapore as an Asia-Pacific AI-focused data center market.
Global Data Center Outsourcing Market Share
By services, co-location hosting services captured major market share owing to the rising enterprise demand for scalable infrastructure
The co-location hosting category is increasingly gaining traction as more companies prefer to outsource their infrastructure in order to reduce costs and make sure that their operations are scalable and secure. Service providers focus on expanding high-capacity data centers and strengthening digital infrastructure to meet rising demand for processing power and scalability. For example, in July 2025, Anant Raj set up a 7 MW data center in Panchkula, in order to increase digital infrastructure in North India.
The trend towards managed hosting is rising significantly within the data center outsourcing market dynamics due to the growing requirement for advanced infrastructure management of complicated tasks with artificial intelligence and high-performance computing. The vendors are launching advanced hosting technologies along with advanced cooling capabilities and automation to increase efficiency. For instance, Hewlett Packard Enterprise rolled out a managed data center hosting solution with direct liquid cooling for AI workloads in collaboration with Khazna Data Centers in the UAE in August 2024.
By segment, the wholesale category shows considerable growth owing to hyperscale cloud expansion
The wholesale segment is becoming dominant as hyperscalers and tech firms secure large-scale infrastructure through long-term leasing agreements. Many market participants are engaged in constructing vast data center campuses intended to handle AI tasks and large-scale clouds. For instance, the firm Vantage Data Centers declared that it would construct a USD 25 billion data center campus, specialized in AI in Texas, United States, in August 2025. These initiatives focused on outsourcing infrastructures with guaranteed large capacities are influencing the current data center outsourcing market trends and dynamics.
Outsourcing of retail data centers is also growing because corporations and IT companies find it easier to lease small and adaptable spaces compared to establishing their own spaces. Service providers are responding by launching new divisions and accelerating modular data center development to serve multiple clients efficiently. For instance, in March 2025, Related Companies introduced a dedicated division to develop USD 45 billion worth of data centers, targeting growing demand from enterprise and retail colocation segments.
By end-use, small and medium businesses (SMB) lead the market growth driven by cost efficiency and cloud accessibility
The SMBs are highly dependent on outsourcing for infrastructure purposes to benefit from IT services at an enterprise level without requiring significant capital expenditure. Providers are improving their cloud-based data center hosting and regional infrastructure that support the SMEs' needs exclusively. For instance, SMB Solutions unveiled plans to launch its data center facility in the United States in March 2024 in order to improve its cloud and infrastructure services for small enterprises. These efforts promote the expansion of the data center outsourcing market through scalability of digital infrastructures among the SMBs.
Data center outsourcing is gradually becoming prevalent among large companies in order to accommodate large volumes of data management, artificial intelligence processing, and growth of digital infrastructure around the world. Conversely, companies are increasing the number of data centers and building more advanced data centers that are able to manage large workload. In June 2025, STL made its own strategic move by increasing its data center portfolio as a response to the increase in demand for advanced data centers that support AI.
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Purchase the Regional Overview for USD 1099
If you choose to purchase the full report at a later stage, the amount already paid will be adjusted, and you will only need to pay the remaining balance.
Purchase the Regional Overview for USD 1099
If you choose to purchase the full report at a later stage, the amount already paid will be adjusted, and you will only need to pay the remaining balance.
Purchase the Regional Overview for USD 1099
If you choose to purchase the full report at a later stage, the amount already paid will be adjusted, and you will only need to pay the remaining balance.
Global Data Center Outsourcing Market Regional Analysis
By region, Asia Pacific dominates the market driven by government digital infrastructure initiatives
Asia Pacific leads market growth due to rapid digital infrastructure transformation, driven by cloud computing adoption, AI advancements, and supportive government initiatives. Various players in the market are enhancing computing capabilities and networks in the region. In February 2026, the Government of India focused on measures that would promote digital infrastructure and the establishment of data centers in the country. These steps further contribute to the overall data center outsourcing market revenue.
Europe accounts for a considerable share of the data center outsourcing industry due to the growing importance of sustainability, compliance with regulations, and energy-efficient computing. Organizations are building highly sophisticated facilities that include renewable energy sources and cooling systems. For instance, in April 2026, Delska inaugurated a cutting-edge data center in Riga, Latvia, which was among the most environmentally friendly facilities in the Baltic region.
Competitive Landscape
The major data center outsourcing market players are significantly turning their attention towards scaling up large digital infrastructure. The need for outsourcing cloud computing and AI services is expected to increase. Service providers are focused on offering such services through investments in building new data centers, updating existing facilities with high-density computing systems, and improving their global connectivity networks. Accordingly, firms are outsourcing their IT infrastructure operations to access computing services that are low in cost.
Other key areas that the data center outsourcing companies are focusing on include partnerships, technology integration, and sustainability efforts for improved efficiencies. The partnership between technology companies and infrastructure firms is leading to the introduction of state-of-the-art power management, cooling, and modular designs. Simultaneously, firms are making use of energy-efficient and renewable energy options to help address environmental issues and minimize costs. All these factors are helping to improve their service efficiencies and meet the digital infrastructure demands of different enterprises across various sectors.
Equinix, Inc.
Equinix, Inc. is a multinational organization that specializes in providing data center solutions for businesses through colocation, interconnection, and managed data centers. It was established in 1998, and its headquarter is located in Redwood City, United States. The company aims at creating interconnected data center environments in all the major digital markets.
Rackspace Technology, Inc.
Rackspace Technology, Inc., is a leading firm established in 1998 and operates from San Antonio, United States. It offers cloud management, hosting, and outsourcing of data center services to assist businesses in handling complicated hybrid or multi-cloud environments. The company has emerged as a leading player operating in the data center outsourcing market by offering cloud and infrastructure management services.
IBM Corporation
IBM Corporation is a leading organization that offers information technology service, that was established in 1911 headquartered in Armonk, United States. Some of its services include cloud computing and infrastructure services that make it possible for users to fully benefit from outsourced data center facilities.
Fidelity National Information Services, Inc.
Fidelity National Information Services, Inc. supports international financial institutions. The firm offers technology and infrastructure solutions, supporting banks, merchants, and capital markets with integrated financial services. It was established in 1968 and is located in Jacksonville, United States.
Other key players in the market include NTT Communications Corporation and CenturyLink, among others.
*Please note that this is only a partial list; the complete list of key players is available in the full report. Additionally, the list of key players can be customized to better suit your needs.*
Key Highlights of the Global Data Center Outsourcing Market Report
- The report focuses on historical market performance and offers reliable forecasts.
- Understands significant technology developments and service innovations by top data center outsourcing providers.
- Focuses on major domestic and international companies that are changing the competitive landscape.
- Covers regional trends and finds new markets with increasing outsourcing demand.
- Offers a data-supported perspective on investments, infrastructure growth, and market opportunities.
Why Choose Expert Market Research?
- Delivers trusted insights supported by extensive primary and secondary research.
- Provides actionable market data to support strategic business decisions.
- Offers detailed region-wise and service-level market analysis.
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Explore the latest trends shaping the global data center outsourcing market 2026-2035 with our in-depth report. Gain strategic insights, future forecasts, and key market developments that can help you stay competitive. Download a free sample report or contact our team for customized consultation on global data center outsourcing market trends 2026.
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*While we strive to always give you current and accurate information, the numbers depicted on the website are indicative and may differ from the actual numbers in the main report. At Expert Market Research, we aim to bring you the latest insights and trends in the market. Using our analyses and forecasts, stakeholders can understand the market dynamics, navigate challenges, and capitalize on opportunities to make data-driven strategic decisions.*
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Key Questions Answered in the Report
In 2025, the global data center outsourcing market reached an approximate value of USD 182.05 Billion.
The market is projected to grow at a CAGR of 5.10% between 2026 and 2035.
The market is estimated to reach a value of about USD 299.38 Billion by 2035.
Key strategies driving the market include infrastructure expansion, strategic partnerships, AI-ready data center development, investment in energy-efficient facilities, and geographic expansion to support rising enterprise and hyperscale demand.
The key market trends include the rising demand for co-location in emerging economies and the increasing merger and acquisition activities by large vendors.
North America, Europe, the Asia Pacific, Latin America, and the Middle East and Africa are the leading regions in the market.
The leading services offered by data centre outsourcing in the market are co-location hosting and managed hosting, among others.
The significant segments of data centre outsourcing in the market are retail and wholesale.
The major end uses of data centre outsourcing in the market include small and medium businesses and large businesses.
The key players in the market include Equinix, Inc., Rackspace Technology, Inc., IBM Corporation, Fidelity National Information Services, Inc., NTT Communications Corporation, and CenturyLink, among others.
Major challenges faced by data center outsourcing market players include high capital investment requirements, rising energy consumption and power costs, data security and regulatory compliance concerns, and increasing competition from cloud service providers.
Report Summary
Explore our key highlights of the report and gain a concise overview of key findings, trends, and actionable insights that will empower your strategic decisions.
| REPORT FEATURES | DETAILS |
| Base Year | 2025 |
| Historical Period | 2019-2025 |
| Forecast Period | 2026-2035 |
| Scope of the Report |
Historical and Forecast Trends, Industry Drivers and Constraints, Historical and Forecast Market Analysis by Segment:
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| Breakup by Services |
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| Breakup by Segment |
|
| Breakup by End Use |
|
| Breakup by Region |
|
| Market Dynamics |
|
| Competitive Landscape |
|
| Companies Covered |
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