Next year should remain a good one for optical communications technology vendors active in the data center space. Dell’Oro Group predicts in its newly released Data Center Capex Quarterly Report for 3Q21 that data center spending for the hyperscale cloud service providers will expand by 30% in 2022.
The hyperscalers will have something to spend that money on, as the market research firm expects current supply chain headwinds to begin diminishing next year as well. The enterprise data center market will benefit from this factor too, Dell’Oro believes. Overall, Dell’Oro’s analysts believe worldwide data center capex will grow 17% in 2022, with data center capex for each of the Top 4 cloud service providers—Amazon, Google, Meta, and Microsoft—predicted to exceed $20 billion during the year.
“We predict the major cloud service providers to enter an expansion cycle in 2022,” commented Baron Fung, research director at Dell’Oro Group. “The Top 10 cloud service providers are planning to launch new data centers in more than 30 regions next year and will increase their investments on new server architectures and network upgrades. The cloud service providers will also increase spending on AI infrastructure, enabling enterprises to deploy applications with enhanced intelligence and automation, and lay the foundation for the metaverse.”
Server unit shipments will return to double-digit growth next year as supply constraints ease, the company states in the report.
Dell’Oro’s Data Center Capex Quarterly Report covers the data center infrastructure capex of each of the 10 largest cloud service providers as well as the “rest-of-cloud,” telco, and enterprise customer segments. Allocation of the data center infrastructure capex for servers, storage systems, and other auxiliary data center equipment is provided. The report also discusses market trends, capex drivers for the leading cloud service providers during the quarter, and the outlook for the next year.
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