European data center market sees colocation boom
The European data center colocation market is projected to reach $35.73 billion by 2030, driven by the AI boom and rapid capacity expansion. Colocation is becoming an increasingly attractive option for AI startups. This allows them to avoid the long lead times, significant capital expenditure, and regulatory hurdles associated with constructing new, privately-owned data centers.
- The primary European data center hubs are Frankfurt, London, Amsterdam, Paris, and Dublin (FLAP-D), which account for over 45% of the continent's operational capacity. Germany leads with 529 data centers, followed closely by the United Kingdom with 523. - Power availability has become the main obstacle to new data center construction, surpassing access to capital. In established markets like Dublin and Frankfurt, the lead time to supply power to new facilities can be longer than three to five years. - AI workloads are driving specific infrastructure demands, including high-density racks with power requirements exceeding 50 kW and advanced liquid cooling systems to manage the heat from GPU clusters. - Major players dominating the European colocation market include Equinix, Digital Realty (which owns Interxion), NTT DATA, Global Switch, and CyrusOne. - There is a geographic split in AI infrastructure deployment: large-scale model training is moving to Nordic regions with plentiful renewable energy, while latency-sensitive inference workloads are being sited in data centers within major metropolitan areas. - In response to regulations and customer demand, sustainability is a major focus, with operators aiming to use 100% renewable energy by 2030. European data center electricity consumption is projected to increase from 96 TWh in 2024 to 168 TWh by 2030. - Stringent data sovereignty rules, primarily the General Data Protection Regulation (GDPR), are a significant driver for companies to use European colocation facilities to process and store data within the region.
