Market Trends of united states data center Industry
Increase use of video calling, augmented in-store shopping experiences, remote health services, and improved mobile gaming to drive market growth
- With the introduction of faster network alternatives, such as 5G and extensive fiber connectivity supporting technologies like FWA, data consumption through smartphones increased from 1.8 GB in 2018 to about 8.5 GB in 2022 at a CAGR of 24.7%. This consumption is expected to further increase to more than 64 GB by 2029, at a CAGR of 33.6%. As 5G drives smartphone adoption and upgrades, the market will witness more data generating points, leading to increased data consumption that leverages higher wireless network speeds.
- Faster internet and the subsequent penetration of devices capable of accessing it play a crucial role in determining and estimating data consumption in a region. Data suggests that the number of 5G mobile connections in the United States will increase from 15% in 2021 to about 68% by 2025, signifying high 5G mobile penetration in the country. Users find enhanced video calling, augmented in-store shopping experiences, remote health services, and improved mobile gaming as some of the activities through 5G networks to be very or extremely appealing, which contributes to data usage.
- Several apps account for considerable smartphone reach across audiences, with YouTube accounting for about 74% audience reach, followed by 61% for Gmail, 59% for Facebook, and 58% for the Google Search app. The extensive reach of such smartphone apps, despite the Android and iOS division among the audience, signifies deep app penetration and usage in the United States. This highlights the need for data storage to provide the required memory platforms for such media to perform and store user data, thereby creating a greater demand for data processing facilities.
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Smartphone adoption and increasing 5G connections to drive market growth
- The United States is a significant market in both North America and the global smartphone portfolio. With smartphone adoption expected to grow from 83% in 2021 to 85% by 2025, it will substantially contribute to the growth of subscriber penetration rates, increasing from 85% in 2021 to 86% by 2025. This growth will result in a rise in smartphone sales and the overall number of smartphones in the country. Although longer replacement rates and a lack of compelling features in the US smartphone industry led to a decrease in sales in 2018, the market received a major boost with the 5G rollout and adoption by operators in the highly competitive smartphone market.
- Additionally, data released in January 2022 indicated a USD 1.7 billion increase in smartphone sales value, totaling approximately USD 74.7 billion in 2022, compared to about USD 73 billion in 2021. Despite the market slowdown during COVID-19, 5G has been a key driver of smartphone adoption and penetration in the United States. The pandemic increased the anticipated number of 5G connections in 2025 from 205 million to about 218 million, signifying how 5G would drive better smartphone sales in the region.
- The increase in the number of smartphones was observed through the growth of mobile wireless subscriber connections in the country, rising from about 442.5 million in 2019 to approximately 498.91 million by 2021. This trend indicates the high penetration rates contributing to sales. Over the forecast period, 5G will heavily contribute to data generation through increased data points, generating demand for more data centers to store and process the data.
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OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT
- Increase network infrastructure and 5G accessibility to drive market growth
- Government investments to shape fiber connectivity to drive market growth
- Growth in Fiber-to-the-home/building (FTTH/B) service in the country drives the demand for data centers
