European data center hubs: FLAP and emerging markets

European data center hubs

The European data center hubs continue to grow and expand. Although the FLAP market continues to be one of the biggest data center markets in Western Europe, other markets have also been growing considerably during recent years. Since investments are particularly strong in emerging data center markets, such as Madrid and Lisbon.

FLAP market

The FLAP market, acronym of “Frankfurt, London, Amsterdam and Paris”, concentrates the largest number of data centers in Western Europe. Leading data centers providers such as Equinix and Digital Realty have made significant investments in these locations and continue to do so.

The FLAP data center market is expected to grow at a CAGR of 2.86% between 2021 and 2027, from about 4.3 billion USD (3.9 billion EUR) to about 5.1 billion USD (4.6 billion EUR), according to a report by Research and Markets.

Emerging data center hubs in Europe

In addition to these leading data center markets, there are other emerging data center markets in Southern Europe, such as Madrid, Barcelona and Lisbon.

The strategic position of the Iberian Peninsula has contributed to attract investments from connectivity and data center providers. Moreover, the region holds numerous connections to submarine cables that connect it with Africa, North America, LATAM and Europe, such as: Grace Hopper, 2Africa, EllaLink, Medusa, ORVAL or SeaMeWe-3.

Spain data centers market

Spain’s strategic location has attracted a growing number of Internet Exchange Points and submarine cables aiming to interconnect the Iberian Peninsula with the rest of the world. Thus boosting investments in the data center market as well. Leading data center operators such as Equinix and Digital Realty are making significant investments in this region as well.

Madrid digital hub

As a result, during the past years, the Spanish capital has become a digital hub for Southern Europe. Madrid concentrates an ever-growing ecosystem of digital business and IT infrastructures to interconnect enterprises and users. This tech hub is developing so fast that it is even expected that, in the coming years, it could compete with the digital hubs in the FLAP market.

As of 2022, there are 37 data centers in Madrid from main operators, according to the Data Centers Snapshot report by Colliers. In terms of power, Madrid’s data centers market is expected to reach a supply of 650 MV IT in the following years.

Barcelona digital hub

Barcelona’s digital hub is booming as well. As of 2022, there are 12 data centers in Barcelona from main operators, according to Colliers’ report. In terms of power, Barcelona’s data centers market is expected to reach a supply of 145 MV IT in the following years. Besides, the city has increased its international Internet bandwidth at a CAGR of 35%.

Together with Madrid and Barcelona, other cities in Spain such as Valencia and Málaga also have growing digital ecosystems that are boosting connectivity and data center services.

Portugal data centers market

Due to its strategic location and the arrival of diverse submarine cables such as 2Africa, Medusa or Columbus III, the development of the data center market is booming in Portugal as well. The region’s good connectivity together with the availability of renewable energy sources also contribute to this growth. 

Lisbon digital hub

During the past years, Lisbon has become an European digital hub. The Portuguese capital has one of the fastest-growing technological ecosystems. The combined value of Lisbon headquartered and founded tech startups has multiplied 27 times between 2016 and 2022 — from about 818 million Euros to more than 21 billion Euros — according to The State of Lisbon’s Startup Ecosystem 2022 report.

In terms of power, Lisbon’s data centers market is expected to reach a supply of 116 MV IT in the following years, according to Colliers’ report.

The growth of data center markets around Europe is closely related to the adoption of cloud services, the Internet of Things, Artificial Intelligence and 5G, among other trends and technologies. All of which are accelerating digitization processes worldwide as well.

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