Data center infrastructure spending is expected to grow 6% globally in 2021 as organizations begin to emerge from COVID-19’s computing stress test, according to the latest data center infrastructure forecast from Gartner. 

Network infrastructure is a dynamic and highly competitive market that necessitates a strong supply chain, economic growth, and a generally positive outlook for what’s to come. However, those factors have been up in the air as the market weathers headwinds tied to the ongoing COVID-19 virus outbreak.  

Pandemic paranoia put a pause on data center infrastructure spending this year, with Gartner noting that spending dropped 10% as constrained budgets prevented more than 60% of new facilities construction. Nevertheless, Gartner is projecting end-user spending on global data center infrastructure products to reach $200 billion in 2021. And that growth is expected to continue growing through 2024, as enterprises carry on in their efforts to build resilience and invest in digital transformation. 

Naveen Mishra, senior research director at Gartner, anticipates larger enterprise data centers will resume expansion later this year or in early 2021. Hyperscalers, according to Mishra, will “continue global expansion plans due to continued investments in public cloud” to meet this pandemic head on, provide an outlet to conserve capital, and deliver on near-term demand for digital services.

Because of the influx of data pouring into data centers, hyperscale cloud providers are in need of more infrastructure housing, which will increase their “substantial spending” on data center leasing, colocation services, and data center construction. A recent report from Synergy Research Group found this grew 10% during the first half of the year.  

That Synergy Research Group report found that cloud operators and vendors generated $187 billion in revenues through the first six months of this year. In total, cloud infrastructure services and enterprise software-as-a-service (SaaS) generated almost $120 billion in revenues, while spending on hardware and software for public, private, and hybrid infrastructure grew by 10%, with revenue hitting just over $60 billion. The report findings indicate that total spend was somewhat evenly split between public and private clouds. 

“In case anyone was still in doubt, cloud is increasingly dominating the IT landscape,” Synergy Chief Analyst John Dinsdale said.