{"id":3876885,"hash":"nkl505gr","type":"List","name":"Data Centers - Exponential Demand Growth","alias":"data-centers-exponential-demand-growth","intro":"Technological complexity of data storage meeting insatiable demand","description":"

Surging numbers of data applications - from\" machine-to-machine\" generation (M2M) to Articial Intelligence (AI) - are like a tidalwave pulling a very long supply chain in its slipstream

\r\n

Data Centers - Exponential Demand Growth - is the first theme of the series, to be followed in the coming weeks by :
Data Centers - Infrastructure Challenges
Networks and Fiber Optics
Cloud - Data Architecture Applications
Data - Enterprise Platforms

\r\n

High - and sometimes exceptional - performance ratios recorded in the series may not be repeated, going forward

\r\n

However, the strategies - and focused specialization - position some firms for outperformance, benefiting from the expanding data demand

\r\n

Data Centers, built or managed by specialized real estate companies (REITs), have been caught up in this tidalwave of data stockage priorities

\r\n

According to Cisco's Annual Internet Report (2018-2023),

\r\n

A growing number of\" machine-to-machine\" applications (M2M), such as smart meters, video surveillance, healthcare monitoring, transportation, and package or asset tracking, are contributing in a major way to the growth of devices and connections. By 2023, M2M connections are estimated at 50% of the total devices and connections.

\r\n

\"\" — Global Device and Connection Growth - Cisco Report 2018-2023

\r\n

AI applications will compound previously projected growth trends in data storage demand...

\r\n

From approx. 4% of US electricity demand in 2022, data centers are expected to account for 6% by 2026 (sce : IEA) and 8% of total consumption by 2030 (sce : Goldman Sachs) - making data centers the key driver in the American power market

\r\n

Pure play data center REITs, such as Digital Realty Trust and Equinix, are unique but other REITs, specialized in telecommunication towers such as American Tower (AMT) or Crown Castle, have engaged

\r\n

stands out with strong financials (as of March '24) but the diversification of these telecom tower-focused REITs may count against them for 'data-centric' investors

\r\n

Housing thousands of server, storage and networking products as well as security, software and mission-critical applications, technical requirements of data centers are high - constraining the speed of expansion of the real estate specialists - in competition with the Internet giants

\r\n

Deep vertical integration of Alphabet, Meta, Amazon (AWS), Microsoft (Azure), IBM and others, such as NTT DATA or Cyrus One, is upending the game as storage demand, requiring immense investments, continues to accelerate

\r\n

It can be argued that, with AI momentum, these Internet majors are competing with one another and, therefore, must prioritize investments in data center networks they will control

\r\n

While the count of data centers is forever growing and yesterday's statistics are meaningless, the number of servers, running into the hundreds of thousands (more than 4 million for Microsoft - multiple 100 000's for Facebook...numbers which surely are already out of date), signals the depth of their presence

\r\n

Not included in the theme :

\r\n

Digital Core REIT - launched by Digital Realty Trust in Singapore (February '24) lacks price data and volume

\r\n

GDS Holdings (ADR) - a Chinese data center network linked to Ailibaba - has suffered from the later's political and economical exposure

","dateCreation":1715162816267.0,"datePublish":1715817600000.0,"dateUpdate":1757600820806.0,"dateUpdateComps":1715794195507.0,"image":"https://static.pininvest.com/uploads/images/lists/nkl505gr/ppzyjnrx/default/data-centers-exponential-demand-growth.jpg","imageSrcUsr":"Nicolas Picard - Data Networks","imageSrcWeb":"Unsplash","imageSrcLink":"https://unsplash.com/photos/selective-focus-photography-of-spiderweb--lp8sTmF9HA","url":"/library/nkl505gr","category":{"id":1912192,"hash":"3x8xjx9r","name":"Technology","brief":" A selection of Technology themes, highlighting key companies and underlying trends - regularly reviewed and updated","description":"

In Technology, themes include majors companies and smaller firms exploring new ways to combine specialized expertise and transform their industry

\r\n

In each theme, the selected companies wil be compared

\r\n

by market cap, performance and volatility
by charts highlighting the outliers
by analytics (multiple ratios)
and by factors (Total Market, Small Cap, Value and Profitability)

","image":"https://static.pininvest.com/uploads/images/categories/3x8xjx9r/41m85xgp/technology.jpg","imageSrcUsr":"Thomas T","imageSrcWeb":"Unsplash","imageSrcLink":"https://unsplash.com/fr/photos/un-tableau-noir-avec-beaucoup-decriture-dessus-OPpCbAAKWv8"},"author":{"id":1570474,"hash":"nj9452x3","alias":"pininvest-analysis","name":"Pininvest Analysis","brief":"Experienced professionals, seeking to combine financial acumen and business expertise","image":"https://static.pininvest.com/uploads/images/contributors/nj9452x3/iy4aijon/thumb/pininvest-analysis.png"},"tags":{"sectors":[{"id":1803118,"label":"Technology","key":"technology","issector":true,"isstyle":false},{"id":3869609,"label":"Total Market","key":"total-market","issector":true,"isstyle":false}],"styles":[],"others":[{"id":2026994,"label":"AI","key":"ai","issector":false,"isstyle":false},{"id":20522952,"label":"Big Data","key":"big-data","issector":false,"isstyle":false},{"id":195186784,"label":"Data Infrastructure","key":"data-infrastructure","issector":false,"isstyle":false},{"id":5327974,"label":"Data Protection","key":"data-protection","issector":false,"isstyle":false},{"id":245534228,"label":"Hyperscalers","key":"hyperscalers","issector":false,"isstyle":false}]},"componentsCount":12,"componentsTotal":12,"articlesCount":2,"stats":{"perf":0.15230371589026898,"perfRankLabel":"Below Average","perfRankKey":"belowavg","vol":0.1543846702669734,"volRankLabel":"Average Risk","volRankKey":"mid"},"history":[{"date":1779235200000.0,"perf":0.0},{"date":1779321600000.0,"perf":0.014485634575506612},{"date":1779408000000.0,"perf":0.02824069857237428},{"date":1779753600000.0,"perf":0.024429748860867517},{"date":1779840000000.0,"perf":0.026594074111233948},{"date":1779926400000.0,"perf":0.028384051523019982},{"date":1780012800000.0,"perf":0.04144006822642132},{"date":1780272000000.0,"perf":0.057152074472548775},{"date":1780358400000.0,"perf":0.05859635985222217},{"date":1780444800000.0,"perf":0.04842233703486651},{"date":1780531200000.0,"perf":0.029346712739986652},{"date":1780617600000.0,"perf":0.057336593392499996},{"date":1780876800000.0,"perf":0.057336593392499996},{"date":1780963200000.0,"perf":0.057336593392499996},{"date":1781049600000.0,"perf":0.057336593392499996},{"date":1781136000000.0,"perf":0.057336593392499996},{"date":1781222400000.0,"perf":0.057336593392499996},{"date":1781481600000.0,"perf":0.057336593392499996},{"date":1781568000000.0,"perf":0.057336593392499996},{"date":1781654400000.0,"perf":0.057336593392499996},{"date":1781740800000.0,"perf":0.057336593392499996},{"date":1781827200000.0,"perf":0.057336593392499996},{"date":1782172800000.0,"perf":0.057336593392499996},{"date":1782259200000.0,"perf":0.057336593392499996},{"date":1782345600000.0,"perf":0.057336593392499996},{"date":1782432000000.0,"perf":0.057336593392499996},{"date":1782691200000.0,"perf":0.057336593392499996},{"date":1782777600000.0,"perf":0.057336593392499996},{"date":1782864000000.0,"perf":0.057336593392499996},{"date":1782950400000.0,"perf":0.057336593392499996}],"viewType":"Sectors","viewLevel":"Level2","showYieldCurve":false}