The increasing adoption of artificial intelligence (AI) and cloud computing is driving up demand for data centers, leading to significant price increases and power consumption. According to recent studies, the global data center market is projected to reach $652.01 billion by 2030, growing at a compound annual growth rate (CAGR) of 11.2% from 2025 to 2030.
The growing need for data storage and processing is fueling demand for data centers, with companies investing heavily in upgrading their infrastructure to support AI and high-performance computing. National average asking prices for data centers have risen to $163.44 per kW/month, marking an 18.6% year-over-year increase.
The impact of this growth on power consumption is substantial, with estimates suggesting a 165% increase in global data center power demand by 2030. This has raised concerns about sustainability, with many operators exploring alternative power sourcing strategies, such as small modular reactors and hydrogen fuel cells.
As the demand for data centers continues to grow, companies like Digital Realty are well-positioned to benefit. Exchange-traded funds (ETFs) like the First Trust Cloud Computing ETF (SKYY) and the Global X Data Center REITs & Digital Infrastructure ETF (VPN) offer diversified exposure to the data center market.
The increasing demand for data centers and the growing importance of AI and cloud computing are transforming the technology landscape. As the industry continues to evolve, it's essential to address the challenges associated with power consumption and sustainability to ensure the long-term viability of data centers.