Data Center Virtualization Market To Reach $23.14 Billion By 2030

Data Center Virtualization Market Growth & Trends

The global data center virtualization market size is anticipated to reach USD 23.14 billion by 2030, growing at a CAGR of 16.5% from 2023 to 2030, according to a new report by Grand View Research, Inc. The requirement for unified and centralized management of data centers and the mounting need to reduce operating costs for organizations and enhance business agility are key factors driving the market. Factors such as the rising demand to decrease data center complexity, increasing spending on data center technology, rising demand for enhanced network security, and adoption of optimization services will also contribute to the growth of the market.

Additionally, the COVID-19 pandemic has expanded the penetration of digital transformation. Growing adoption of smart devices, IoT, digital transactions, rising automation scope in manufacturing industries via industry 4.0 technologies, and potential for huge data generation in sectors including education, healthcare, BFSI, IT & telecom, and media & entertainment will accelerate the development of data centers, thereby fueling the market for data center virtualization.

More number of businesses are incorporating DevOps and cloud-native technologies onto the businesses development process, which has resulted in the lines between the modern container-based platforms and traditional virtualization platforms to blur; of which a major part can be attributed to organizations opting for cloud-native technologies in support of legacy applications or ones which is not suited for containerization. Organizations operate on a tightrope because they need to negotiate both worlds without burdening IT operations. This has resulted in more IT teams turning to composable disaggregated infrastructure (CDI). CDI can also provide resources on demand to accommodate different workloads, including applications running in VMs, bare metal, and containers in VMs.

The market players have been involved in various strategic initiatives, including partnerships, acquisitions, and mergers. Such initiatives have helped enhance product capability and have a wider sales channel, among others, which has accelerated the growth of the data center virtualization industry over the forecast period. For instance, in May 2023, Aligned Automation announced a partnership with Denodo Technologies to expand the Aligned Automation data virtualization capabilities, enabling the company to offer robust end-to-end data integration solutions. The partnership will enable businesses to have seamless, integrated access to prior siloed data, offer better ways to view and analyze data across enterprises, and increase effectiveness, maximizer efficiency, and cost optimization.

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Data Center Virtualization Market Report Highlights

• The server type segment is estimated to occupy the largest share of the market in 2022. It is projected to continue its dominance over the forecast period. The growth of server virtualization can be attributed to major companies coming up with a server virtualization solution, enabling capabilities, thereby attracting more businesses

• By component, the software segment occupied the largest revenue share of around 79% in 2022. Risen adoption of virtualization software such as network virtualization, storage virtualization, and server virtualization in data centers is contributing to the market’s growth

• By service, the optimization services segment is projected to witness the highest CAGR of more than 18% from 2023 to 2030. The growth of the optimization services segment can be attributed to its benefits, which include better data mobility, increased profitability, and enhanced security and compliance

• By organization size, the small and medium-sized enterprises (SMEs) segment is projected to witness the highest CAGR of approx. 17% from 2023 to 2030. Effective campaigns in the data center virtualization industry offering solutions specific to SMEs have also been boosting SMEs' adoption of data center virtualization

• By end-use, the healthcare segment is projected to witness the highest CAGR of around 18% from 2023 to 2030. The growth of the healthcare segment can be attributed to the increasing demand for easy and secure data sharing, and access to high-quality health records, among others

• The key players have a wider sales channel, thereby driving the market's growth. Some major companies operating in the data center virtualization industry include VMware, Inc.; IBM; Fujitsu; Dell Inc.; AT&T; Microsoft; Oracle; and HCL Technologies Limited

Data Center Virtualization Market Segmentation

Grand View Research has segmented the global data center virtualization market based on type, component, service, organization size, end-use, and region:

Data Center Virtualization Type Outlook (Revenue, USD Billion, 2018 - 2030)

• Server

• Storage

• Network

• Desktop

• Application

• Others

Data Center Virtualization Component Outlook (Revenue, USD Billion, 2018 - 2030)

• Services

• Software

Data Center Virtualization Service Outlook (Revenue, USD Billion, 2018 - 2030)

• Advisory & Implementation Services

• Optimization Services

• Managed Services

• Technical Support Services

Data Center Virtualization Organization Size Outlook (Revenue, USD Billion, 2018 - 2030)

• Small and Medium-Sized Enterprises (SMEs)

• Large Enterprises

Data Center Virtualization End-use Outlook (Revenue, USD Billion, 2018 - 2030)

• BFSI

• IT & Telecommunication

• Manufacturing & Automotive

• Government

• Healthcare

• Education

• Retail & SCM

• Media & Entertainment

• Others

Data Center Virtualization Regional Outlook (Revenue, USD Billion, 2018 - 2030)

• North America

  • U.S.

  • Canada

• Europe

  • UK

  • Germany

  • France

  • Italy

  • Spain

• Asia Pacific

  • China

  • India

  • Japan

  • Australia

  • South Korea

• Latin America

  • Brazil

  • Mexico

  • Argentina

• Middle East & Africa

  • UAE

  • Saudi Arabia

  • South Africa

List of Key Players in the Data Center Virtualization Market

• ATTO Technology, Inc.

• AT&T

• Cisco Systems, Inc.

• Dell Inc.

• Fujitsu

• HCL Technologies Limited

• Hewlett Packard Enterprise Development LP

• Huawei Technologies Co., Ltd.

• IBM

• Konverge

• Microsoft

• Oracle

• Rahi

• Veritis Group Inc

• VMware, Inc.