Market Trends of Israel Data Center Construction Industry
IT and Telecom to have significant market share
- The media and entertainment industry accounted for a 1.20 MW IT load capacity in 2021, inhibiting growth from 1.39 MW in 2022 to 3.80 MW in six years at a CAGR of 15.02%. The manufacturing industry accounted for an IT load capacity of 40.3 MW in 2022, constituting a significant share of the total IT load utilization.
- This is down to different manufacturing sectors choosing digitalization, including aerospace and defense, telecommunications equipment, aviation communications, chemical products, computer hardware, and software. By the end of March 2022, Israel was among eight countries in the MENA region to launch commercial 5G.
- The industry-grade demand for a minimal latency rate would drive the growth of the telecom industry in the country. Similarly, as 5G gains traction for the general public, it would generate more demand for the data centers to provide the platform, facilitating the system requirements. As reported in October 2022, Google Cloud facilitates cloud services for the Israeli government ministries, justifying the 28.82 MW of IT load capacity accounted for by the government sector.
Understand The Key Trends Shaping This Market
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Tel Aviv is the major hotspot in the country
- Tel Aviv is the major hotspot in the country, accounting for 38.80 MW of the IT load capacity, exhibiting stagnant growth during the forecast period. The region is called a major technological hub, with its proximity to crucial government facilities, power resources, and technological advancements required for empowering and operating data centers.
- This also includes several client companies in and around Tel Aviv, leveraging faster internet connectivity through the facilities. Petah Tikva benefits from the proximity of energy resources and business parks to Tel Aviv, including several data centers. Also, both locations leverage efficient disaster management services, which are essential for the uninterrupted functionality of data center facilities.
