01
Data Center Market Overview:
The construction of data center cabinets is developing rapidly.
In recent years, China has made significant progress in developing advanced technologies such as cloud computing, artificial intelligence, and 5G, leading to a year-on-year increase in computing power demand. As the construction plans for eight major national computing power hubs have entered the deep implementation phase, there has been a surge in new data center construction across the country. According to statistics, the scale of data center racks in China has continued to expand steadily, with rapid growth in large-scale data centers. By the end of 2022, the scale of data center racks in use in China had reached 6.7 million (calculated based on standard racks of 2.5 kW), with an average annual compound growth rate exceeding 30% over the past five years.
Data source: Information and Communication Development Department of the Ministry of Industry and Information Technology, analysis by Frost & Sullivan
02
Overview of Rack Deployment in China's Data Center Industry
According to statistics, while the scale of cabinets is growing at a high rate, China's data center industry is also facing the dilemma of low rack utilization rates. There are issues such as an imbalance between supply and demand, mismatched needs, and poor information flow in data centers. In 2022, the average rack utilization rate of data centers in China was about 58%, indicating that there is still room for improvement. From the demand side, the current cross-regional demand for computing power has not been fully mobilized; from the supply side, many cabinets in the western region have not been fully utilized. The future increase in rack utilization rates in data centers in the western region will drive an increase in the national average rate.
Data source: Information and Communication Development Department of the Ministry of Industry and Information Technology, analysis by Frost & Sullivan
In the past, due to reasons such as fewer IP backbone network nodes and internet nodes in the western region, as well as less fiber optic resources, the efficiency of data cross-basin circulation has always lagged behind that of economically developed regions in the eastern part. Therefore, China's data center industry has long been in a pattern of 'hot east, cold west,' with a significant difference in the deployment rate of data centers between the east and west. The deployment rates in East China, North China, and South China are all above 65%, while in the northwest and southwest regions, they are only about 30% and 40%, respectively. The current imbalance between supply and demand in China's computing power market is evident.
It is expected that in the future, with the continuous advancement of the 'East Data West Computing' project, data center networks in the western region will be gradually improved. Cold storage services and offline computing services will continue to develop, and the average rack utilization rate of China's data center industry will continue to rise.
03
Overview of the Deployment Rate of Large Retail Data Centers in China
Compared to wholesale data center enterprises that sell in batches by module, retail data centers typically rent out cabinets as their smallest unit. Therefore, the listing rate of wholesale enterprises often depends more on the demand scale of large customers, while the listing rate of retail enterprises is determined more by their own refined management and operational capabilities.
Source: Analysis by Frost & Sullivan
Currently, the retail third-party neutral data center service industry in China is relatively concentrated. The main leading players include CenturyLink, Halo New Network, Kehua Data, OFID, and Youfu Network, among others. There are also many small and medium-sized service providers within the industry, making competition fierce. Most of these small and medium-sized enterprises have a relatively low listing rate, while the leading retail enterprises possess strong comprehensive operational management capabilities such as sales, service, and operations, resulting in an average higher listing rate. Based on the overall average listing rate for 2022, Kehua Data has the highest listing rate among large retail data center enterprises in China, with an average listing rate reaching 80%.
04
Overview of Industry-Leading Enterprises
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Kehua Data
Kohua Data is a leading high-tech enterprise in China, focusing on providing green data centers, smart power supplies, clean energy products and solutions. It is also listed on the Shenzhen A-share market. Kohua Data has over 10 years of experience in data center construction, operation and management. It possesses comprehensive data center service capabilities for all scenarios, including general hosting, large-scale customization, agile delivery, and high computing power. It empowers the digital transformation of various industries with continuously refined products and services.
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Guanghuan New Network
Aurora New Network is a data center and cloud computing service provider, focusing on internet data center services (IDC and its value-added services, cloud computing, internet broadband access services, etc.), and offering integrated cloud service solutions including Amazon Web Services to customers.
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Century Internet
Century Internet is a provider of network space infrastructure services, as well as a leading enterprise in the field of scientific and technological innovation digital new infrastructure. It is also the first US-listed IDC company in China. Today, it has established large-scale data center industrial clusters in regions such as Beijing-Tianjin-Hebei, Yangtze River Delta, and Guangdong-Hong Kong-Macao.
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AOFee Data
AOF Data is a comprehensive provider of internet cloud computing and big data infrastructure services, dedicated to building a multi-cloud, multi-network, and multi-terminal digital industry ecosystem platform. It aims to construct a high-speed cloud computing and big data transmission processing platform suitable for the new generation network communication technology 5G, as well as a globally interconnected network.
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Youfu Network
Yofu Network is a new type of cloud computing data center service provider, dedicated to helping users in industries such as finance, education, scientific research, new retail, and life sciences develop towards digitalization, intelligence, and smart governance.
