Global Data Center Virtualization Market Insights Forecasts to 2032

• The Global Data Center Virtualization Market Size was valued at USD 11.23 Billion in 2022.
• The Market is Growing at a CAGR of 13.07% from 2022 to 2032
• The Worldwide Data Center Virtualization Market is expected to reach USD 38.37 Billion by 2032
• North America is expected to grow the fastest during the forecast period

The Global Data Center Virtualization Market Size is expected to reach USD 38.37 Billion by 2032, at a CAGR of 13.07% during the forecast period 2022 to 2032.

Data center virtualization converts existing data centers into virtual data centers utilizing a cloud-based computing system, allowing organizations to gain access to data and applications from anywhere. A virtualized data center, also known as a Software Defined Data Center (SDCC), enables enterprises to control their whole IT system as a single entity, frequently from a centralized interface. In comparison to actual servers, which necessitate considerable and sometimes costly procurement and administrative management, virtual data centers are considerably easier, faster, and less expensive to deploy. The replication of production settings for testing and disaster recovery can also be accomplished using data center virtualization. Data center virtualization has various advantages, including greater allocation of resources, less usage of energy, and reduced expenses. Furthermore, data center virtualization can increase reliability and efficiency by enabling IT resources to be provided and deployed as required.

The major players in the data center virtualization market include Cisco Systems, HPE, AT&T, HCL, VMware, Microsoft, Adobe Systems, Amazon Web Services, and IBM. In order to thrive in the highly saturated market and grow their company footprints, these industry leaders are implementing initiatives such as partnerships, collaborations, and product launches. Furthermore, enterprises are selecting data center virtualization to improve the adaptability, scalability, and mobility of their own data centers, driving the adoption of products even higher.

For instance, on May 2023, Juniper Networks, Inc. announced the availability of a cloud-based Access Assurance Service to assist network managers, simplify IT operations, and assure a better user experience through automation and increased network resiliency. The AI-powered automation solution streamlines network access by allowing for quick and easy device provisioning. It eliminates manual settings with a one-click setup. Its distinct microservices-based cloud architecture increases resiliency and scalability while ensuring dependable and low latency access control.

Driving Factors

The drive for organizations to minimize operational expenses and improve company flexibility, as well as an increasing need for consolidated and centralized data center administration, are key factors driving data center virtualization market expansion. Additionally, considerations comprising the growing need to simplify data centers, the rapid uptake of private clouds, the rising costs of data center technology, and a significant rise in data center traffic are anticipated to boost the expansion of the data center virtualization market over the forecast period. Furthermore, growing public awareness of the benefits of cloud-based data storage will drive market expansion globally.

Also, the rising priority of organizations in the banking, finance, and insurance sectors on shifting data to cloud-based systems in order to boost business flexibility is expected to drive data center virtualization market growth. Organizations are primarily forming strategic growth relationships with public and private entities in a variety of industries that require data digitization. Growing customer demand for data, whether structured or unstructured, for market trend analysis, market demand, product selection, and so on, has resulted in increased demand for data storage, which has contributed to the growth of the data center virtualization market.

Restraining Factors        

However, a lack of understanding of virtualization technology among businesses is a major factor restricting the data center virtualization market over the projection period. Additionally, a lot of businesses lack understanding and information regarding the switch from physical hardware infrastructure to a virtual setup that addresses many areas of data centers, including servers, storage, networking, and applications.

Covid-19 Impacts

The COVID-19 outbreak created a slew of new prospects in the data center virtualization market. The pandemic provided a huge push towards digital transition and internet services around the world, with many firms and industries beginning to collaborate and work from home. As a result, the demand for data centers has skyrocketed because technologies that function remotely are required to keep businesses running during the worldwide outbreak. In consideration of the remote working trend, companies increasingly chose data center virtualization for seamless corporate operations, which increased industry penetration in both developed and emerging countries globally.

Market Segmentation

By Industry Verticals Insights

The IT & telecommunication segment accounted for the largest revenue share of more than 57.2% over the forecast period.

On the basis of industry verticals, the global data center virtualization market is segmented into BFSI, education, government, IT & telecommunication, healthcare, media & entertainment, retail & SCM (Supply Chain Management), manufacturing & automotive, and others. Among these, IT & telecommunication are dominating the market with the largest revenue share of 57.2% over the forecast period. With the introduction of emerging technologies such as 5G, NFC, and others, the IT and telecom industries are undergoing a transformational upheaval. Furthermore, data center virtualization can increase service levels while lowering expenses. Since these technologies require real-time data transfer, IT & telecommunications providers adopt high-performance data centers to enable effective data management, fueling demand for data center virtualization market. Furthermore, data center virtualization offers the potential to increase efficiency by facilitating greater resource utilization.

By Type Insights

The advisory & implementation services segment is witnessing significant CAGR growth over the forecast period.

On the basis of type, the global data center virtualization market is segmented into advisory & implementation services, optimization services, managed services, technical support services. Among these, advisory & implementation services are witnessing significant CAGR growth over the forecast period. Advisory and implementation services data center virtualization is a process of abstracting applications and workloads from the underlying physical infrastructure. This conceptualization allows companies to maximize resource use, improve adaptability and responsiveness, and cut expenses.

By Offering Insights

The software segment is dominating the market with the largest revenue share over the forecast period.

On the basis of offering, the global data center virtualization market is segmented into the software and services. Among these, the software segment is dominating the market with the largest revenue share of 58.6% over the forecast period. The market is expanding as a result of a rise in the use of virtualization software in data centers, including server, network, and storage virtualization.

Regional Insights

North America dominates the market with the largest market share over the forecast period.

North America will dominate the market with a market share of more than 38.7% during the projected period, owing to increased industrialization and widespread usage of cloud-based solutions in this region. The rapid implementation of data center virtualization services and applications in this region is the primary driver of market growth. Furthermore, the widespread presence of leading market participants such as Microsoft, VMware, Citrix Systems, and Cisco Systems Inc are driving data center virtualization market growth. This region is additionally experiencing a high level of cloud adoption, with cloud service providers strengthening and growing their infrastructure by integrating virtualization applications and services.

Asia Pacific, on the contrary, is expected to grow the fastest during the forecast period. The regional industrial sector’s growing desire for digitization has led in an increase in demand for high-performance data center virtualization. Furthermore, organizations in the IT & telecom are incorporating innovative technologies to improve the consumer experience, ultimately promoting regional progress. The rising focus of organizations on achieving high data center performance at a low cost is the primary reason that is projected to fuel the expansion of the region's data center virtualization market.

List of Key Market Players

• Adobe Systems
• VMware
• Cisco Systems
• Microsoft
• HCL
• AT&T
• Citrix Systems
• Fujitsu
• Dell Inc.
• Nutanix
• HPE
• IBM
• Huawei
• Radiant Communications
• Amazon Web Services

Key Market Developments

• On May 2023, Platform9, a leader in helping enterprises with a better way to go cloud native, today announced the most recent release of its products Platform9 KubeVirt and Platform9 Managed Kubernetes (PMK) to address the most pressing budget, staffing, and operational efficiency challenges enterprises are facing in today’s tight economy.

• On May 2023, AT&T and BlackRock, through a fund managed by its Diversified Infrastructure business, have closed their joint venture to form Gigapower, LLC. Gigapower plans to provide a state-of-the-art fiber network to internet service providers and other businesses in parts of select metro areas throughout the country using a commercial wholesale open access platform. AT&T and BlackRock will jointly own and govern Gigapower.

• In August 2022, Verge.io, formerly known as Yottabyte, has added GPU virtualization to its virtual data-center software, making it possible to partition out GPU-based processing tasks the same way a hypervisor divides up a CPU. Hyperconverged infrastructure (HCI) builds a tightly integrated and configured IT data center setup from standard server, storage, and networking servers with everything virtualized.

Market Segment

This study forecasts revenue at global, regional, and country levels from 2020 to 2032. Spherical Insights has segmented the Global Data Center Virtualization Market based on the below-mentioned segments:

Data Center Virtualization Market, Industry Verticals Analysis

• BFSI
• Education
• Government
• IT & Telecommunication
• Healthcare
• Media & Entertainment
• Retail & SCM
• Manufacturing & Automotive
• Others

Data Center Virtualization Market, Type Analysis

• Advisory & Implementation Services
• Optimization Services
• Managed Services
• Technical Support Services
• Others

Data Center Virtualization Market, Offering Analysis

• Software
• Services

Data Center Virtualization Market, Regional Analysis

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • Uk
  • France
  • Italy
  • Spain
  • Russia
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Rest of Asia Pacific
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Middle East & Africa
  • UAE
  • Saudi Arabia
  • Qatar
  • South Africa
  • Rest of Middle East & Africa