[Africa Cloud Review] Simon Nguniri: Kenya's Data Center Market Size by investment is set to Reach $342 Million by 2026
Kenya is witnessing the growing adoption of digital services such as cloud, big data, and IoT driving the demand for data centers in the region.
Kenya's data center market is set to grow at a CAGR of 12.36% during 2021-2026. This is according to the "Kenya Data Center - Investment Analysis & Growth Opportunities 2021-2026" report released this week.
The report notes that the data center market in Kenya includes around six unique third-party data center service providers operating around nine facilities.
Kenya is one of Africa's primary data center hubs and is considered the gateway to the East African region. Nairobi, the capital city, is a favorable location for data center development. In Kenya, Unaitas Sacco, a financial firm, selected Eastra Solutions for installation and commissioning services to Unaitas Data Center. Atos is investing in the development of a new data center facility in Kenya with around USD 260 million investment at the Mwale Medical and Technology City (MMTC) in Butere, Kakamega County.
Icolo.io which is among the top data centers investors in Kenya recently announced the construction of its third data center in Kenya to be located in Nyali, Mombasa. Called MBA2, the new data center is expected to be completed in Q1 of 2022 and set to provide an estimated capacity of 1.6MW megawatt and 1,200 square meters of IT space.
Other key investors include IXAfrica, PAIX, Teraco Data Environments, and Wingu.
Other tech giants like Huawei Huawei Technologies is among the leading vendors in the modular data center space with multiple efficient and reliable deployments. All the vendors the report notes have taken precautionary measures to reduce disruptions in their supply chain operations. The most commonly adopted servers in the industry include rack and blade servers from Cisco Systems, HPE, Dell Technologies, IBM, and Lenovo.
Data centers are being utilized now more than ever according to Carol Koech is the Country President for Schneider Electric East Africa. Data spending is also going up with Gartner estimating that end-user spending on global data center infrastructure is projected to reach US$200 billion in 2021, up 6% from 2020. The landscape in East Africa is no different. In Kenya for example, the country has a total number of 43.7 million Internet/data subscriptions according to the Communication Authority of Kenya; this coupled with the country’s youthful demographics means that data demand will rise rapidly, which will require more data centers. And we can already see investments in this space.
Across Africa, the continent accounts for less than 1% of the world’s co-location data centre supply, with South Africa accounting for the bulk of the continent’s capacity. Co-location facilities rent space, power and cooling to enterprise and hyperscale customers; they also offer interconnection enabling businesses to scale at low complexity and cost.
Nina Triantis, Global Head of Telecoms, Media & Technology at Standard Bank notes that we should expect to see a substantial wave of data centre investments materialise across the continent, led by regional economic powerhouses including South Africa, Kenya and Nigeria.