South Africa Data Center Colocation Market to Surpass USD 843 Million by 2030 as Smart Cities Drive $26.9B IoT Growth | Arizton
According to Arizton research, the South Africa data center colocation market size was valued at USD 410 million in 2024 and is expected to reach USD 843 million by 2030, growing at a CAGR of 12.76% during the forecast period.
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Report Summary:
MARKET SIZE - COLOCATION REVENUE: USD 843 Million (2030)
CAGR - COLOCATION REVENUE: 12.76% (2024-2030)
MARKET SIZE - UTILIZED WHITE FLOOR AREA: 1.95 million sq. feet (2030)
MARKET SIZE - UTILIZED RACKS: 46.9 thousand units (2030)
MARKET SIZE - UTILIZED IT POWER CAPACITY: 420 MW (2030)
BASE YEAR: 2024
FORECAST YEAR: 2025-2030
South Africa Data Center Colocation Market to Expand Its Operational Floor Area from 0.9 to 1.95 Million Sq. Ft by 2030
South Africa is witnessing rapid growth in its data center industry, with Johannesburg emerging as the country’s central hub for development and one of its leading smart cities, hosting major companies and business hubs. Industrial land prices have been rising steadily, particularly in prime locations, driven by strong demand and limited supply, while Cape Town has seen a surge in industrial land interest as local businesses and international firms recognize the city as a strategic base for growth. Industrial land in South Africa is currently valued between USD 100 and 220 per square meter, reflecting the robustness of the market.
This trend is further supported by the development of special economic zones (SEZs), including Coega IDZ and O.R. Tambo SEZ, which offer incentives such as tax benefits, construction allowances, and improved market access, creating an enabling environment for the data center industry. As digital adoption accelerates across the country, the sector is expanding steadily, reflecting South Africa’s commitment to strengthening its digital infrastructure and positioning itself as a regional leader in technological and economic growth.
South Africa’s Digital Boom: 27 Million Social Media Users Driving Market Growth
South Africa is experiencing a notable digital transformation, driven by a growing internet user base and strategic initiatives from the government and private sector. Central to this evolution is the Digital Economy Master Plan (DEMP) by the Department of Communications and Digital Technologies (DCDT), which focuses on strengthening digital infrastructure and fostering innovation across key industries. By January 2025, South Africa recorded 27 million active social media identities, with Facebook reaching 35 million user account and YouTube 25 million user accounts . These platforms are increasingly serving as channels for digital literacy, entrepreneurship, and broader economic participation, underscoring the expanding role of the digital economy in shaping the country’s market landscape.
South Africa’s IoT Boom: From Smart Farms to Smarter Cities Driving $26.9B Market by 2029
South Africa is witnessing a rapid expansion of its IoT market, projected to reach USD 15.8 billion in 2024 and grow to USD 26.9 billion by 2029 . This growth is fueled by the adoption of smart agriculture systems, where IoT devices monitor soil conditions and optimize irrigation, generating vast amounts of data that require robust processing and storage solutions. At the same time, urban centers such as Johannesburg, Cape Town, and Durban are deploying IoT to tackle everyday challenges, from traffic congestion to waste management and public safety. Coupled with the country’s reliance on renewable energy sources like wind and solar, IoT-enabled smart grid systems are helping monitor energy usage and improve efficiency. As these technologies converge, by 2030, IoT is expected to be fully integrated into South Africa’s industrial and public sectors, driving smarter urban planning, more efficient healthcare, and sustainable agriculture, and positioning the nation as a leader in digital transformation.
AI Growth Boosts Energy Infrastructure Opportunities in South African Data Centers Market
South Africa is prioritizing digitalization as a key driver of economic growth, creating increasing demand for robust infrastructure to support advanced technologies. The widespread adoption of AI has led to higher rack power densities in data centers, increasing energy requirements in regions where existing grids are insufficient. This has created significant opportunities for dedicated substations and independent backup power solutions, with companies like ACTOM providing turnkey EPC substation services that are gaining traction across the country. Supporting this development, government initiatives such as the AI Institute of South Africa (AIISA) and the National AI Policy Framework aim to accelerate AI integration across industries, reinforcing South Africa’s position as a growing market for advanced, energy-efficient data center operations.
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Existing Colocation Operators
- Teraco (Digital Realty)
- Africa Data Centres
- Digital Parks Africa
- Vantage Data Centers
- Open Access Data Centres
- Equinix
- NTT Data
- Others
New Operators
- Paritus
- Cassava Technologies
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What Key Findings Will Our Research Analysis Reveal?
- What is the count of existing and upcoming colocation data center facilities in South Africa?
- How much MW of IT power capacity is likely to be utilized in South Africa by 2030?
- What factors are driving the South Africa data center colocation market?
- Who are the new entrants in the South Africa data center industry?
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