Expansion Driven by Submarine Connectivity
The data center industry in Mexico is experiencing an unprecedented boom. According to the recent report "Mexico Data Center Colocation Market - Supply & Demand Analysis 2023-2028" published by ResearchAndMarkets.com, the data center colocation market in Mexico is projected to reach a value of $550 million by 2028, experiencing growth from the $206 million recorded in 2022. This projection represents a compound annual growth rate (CAGR) of 17.78% during the period 2022-2028.
Mexico: A Strategic Hub in Latin America
Mexico has established itself as a prominent destination for data center development in the Latin American region, firmly occupying the second position. Its strategic location makes it an essential bridge for data flow between the United States and other Latin American countries.
The exponential growth is primarily attributed to growing demand driven by digitalization initiatives. Additionally, the entry of major cloud operators in the Mexican landscape, the implementation of advanced 5G technology, the increase in Big Data utilization, and the proliferation of IoT applications are catalyzing this expansion. Notably, Mexico is increasing its submarine connectivity, currently counting seven submarine cables and with significant investments for three additional cables expected to be operational by 2026.
Technology Leaders Establishing Themselves in Mexico
The boom in cloud-based services has attracted renowned cloud operators to establish dedicated cloud regions in Mexico. Companies such as Google and Microsoft are actively involved in the development of new cloud regions, which are expected to be operational by 2024.
Regarding colocation data centers, Mexico predominantly follows Tier III standards, reflecting its commitment to solid and reliable infrastructure. This growing market hosts a wide variety of operators, both local and global, among which are KIO Networks, Ascenty (Digital Realty), TELMEX (Triara), and many others.
Global operators are strategically using mergers and joint ventures as entry points into the flourishing data center colocation market in Mexico. A notable example is Digital Realty, which operates in Mexico through a joint venture with Brookfield Infrastructure under the Ascenty brand.
With a clear vision toward the future, Mexico continues to strengthen its position in the Latin American data center market. The country is not only capitalizing on current digitalization trends, but is also laying the groundwork for future technological innovations, ensuring its relevance in the global technology scene.
Information from Yahoo Finance