As the amount of information rises and corporate spending on technology accelerates, demand will underpin price growth.
Los Angeles, CA (PRWEB) February 27, 2014
The market for data center services exhibits a buyer power score of 3.5 out of 5. Contributing to this score is the steady and predictable price trend of the services. According IBISWorld analyst Nikoleta Panteva, suppliers have kept their price hikes minimal over the three years to 2013 as a result of waning demand during the recession. Over the next three years, competition from low-price (and free) cloud storage solutions will continue to restrict price growth.
Moreover, buyers have nearly 6,000 suppliers from which to choose for their data center services. Major suppliers in this market include Equinix Inc., Digital Realty Trust and AT&T Corp. Buyers may opt for large-scale providers like AT&T or Verizon, which offer steady pricing and easily bundle additional products and services for total cost savings. Bundling options are another factor that contributes to strong buyer power, continues Panteva. Buyers may also choose a smaller local or niche supplier that is more flexible on rates but does not have the scope of large suppliers.
However, several other market factors work to reduce buyer power. The high switching costs associated with data centers may keep many buyers from seeking a new provider. Aside from early termination fees associated with long-term contracts, buyers can suffer from downtime and the risk of losing information during data transfer. Furthermore, the lack of viable substitutes for data center services lock buyers into seeking the services of this market. Fortunately, the mounting prevalence of cloud storage will help constrain price growth over the three years to 2016. For more information, visit IBISWorld’s Data Center Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of data center services, which may process, store, network, manage and distribute data. These services may also include data backup and archiving, managed e-mail or cloud computing. This report focuses exclusively on companies that provide outsourced data center services for businesses, rather than those companies that advise businesses on how to create their own data storage and processing centers.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
Vendor Financial Benchmarks
Buying Lead Time
Key RFP Elements
Buyer Power Factors
About IBISWorld Inc.
IBISWorld is one of the world's leading publishers of business intelligence, specializing in Industry research and Procurement research. Since 1971, IBISWorld has provided thoroughly researched, accurate and current business information. With an extensive online portfolio, valued for its depth and scope, IBISWorld’s procurement research reports equip clients with the insight necessary to make better purchasing decisions, faster. Headquartered in Los Angeles, IBISWorld Procurement serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.