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2019

Virtual Private Server Market

Virtual Private Server Market Size, Share, Competitive Landscape and Trend Analysis Report by Type, Operating System, Organization Size and Industry Vertical : Global Opportunity Analysis and Industry Forecast, 2019-2026

IC : Information, Infrastructure & Network Security

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Author's: Bhushan Jagtap | Onkar Sumant
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Virtual Private Server (VPS) Market Statistics - 2026

The virtual private server market size was valued at $2.6 billion in 2018, and is projected to reach $8.3 billion by 2026, growing at a CAGR of 16.2% from 2019 to 2026. Virtual private server (VPS) is the combination of dedicated and shared hosting services. It comprises a physical machine provided by a hosting company that enables users to attach or detach hardware components as per the needs and business size. In addition, users can install numerous VPS on a single physical host with various operating systems as per their requirements. Moreover, rise in cyber threats & cyber-attacks in data centers across the globe has boosted the demand for virtual private servers.

Virtual Private Server Market

The managed VPS segment dominated the overall virtual private server market share in 2018, and is expected to generate the highest revenue during the forecast period. The growth of this segment is majorly attributed to increase in demand for virtual private servers by majority of enterprises to save time on handling technical issues.

The Linux segment is expected to be the major revenue contributor throughout the forecast period, owing to increase in demand for secure operating systems by majority of enterprises. In addition, VPS hosting on Linux costs less maintenance and service cost than Windows VPS hosting, which is also the major reason that majority of the organizations are opting for Linux based VPS solutions.

North America dominated the overall virtual private server market in 2018, and is expected to continue this trend during the forecast period, due to the presence of major market players and increase in cyber threats in the region. However, Asia-Pacific is expected to exhibit highest growth rate throughout the virtual private server market forecast period due to increase in support by government for virtualized data centers.

The report focuses on the growth prospects, restraints, and trends of the virtual private server market analysis. The study provides Porter’s five forces analysis to understand the impact of various factors such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers on the global market.

Virtual Private Server Market
By Type
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Managed VPS would exhibit the highest CAGR of 16.5% during 2019-2026.

Segment review

The global virtual private server market is segmented into type, operating system, organization size, industry vertical, and region. As per type, the market is bifurcated into managed VPS and unmanaged VPS. By operating system, the market is divided into Windows and Linux. On the basis of organization size, the market is segregated into large enterprises and small & medium enterprises. Depending on industry vertical, it is fragmented into IT & telecommunication, retail, BFSI, manufacturing, healthcare, and others. Region wise, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

The market is dominated by the global virtual private server players such as Amazon Web Services, Inc., DreamHost, LLC, Endurance International Group, GoDaddy Operating Company, LLC, IBM, InMotion Hosting, Liquid Web, OVH, Rackspace US, Inc., and United Internet AG.

Virtual Private Server Market
By Operating System
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Linux would exhibit the highest CAGR of 16.7% during 2019-2026.

Top impacting factors

Current and future virtual private server industry trends are outlined to determine the overall attractiveness of the market. Top impacting factors highlight the virtual private server market opportunity during the forecast period. Factors such as rise in security concerns among enterprises and enhanced customization, scalability, and downtime are some of the key factors that drive the global virtual private server market growth. However, limited physical resource and bandwidth availability is expected to impede the market growth during the forecast period. On the contrary, integration of machine learning and AI with VPS is expected to provide remunerative opportunities for VPS market expansion in the upcoming years.

Virtual Private Server Market
By Industry Vertical
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Healthcare would exhibit the highest CAGR of 19.7% during 2019-2026.

Rise in security concerns among enterprises

Enterprises globally are facing issues in managing their confidential data due to traditional data management practices. In addition, upsurge in risk of cyber threats and data breach fuels the demand for numerous cloud services across enterprises. Moreover, management of server entirely depends on the user; hence, it is necessary for enterprises to adopt robust security measures. Thus, virtual private server provides sandbox security without affecting physical server’s operation. In addition, virtual private server provides extra security to protect the sensitive data of enterprises, which serves as the key factor augmenting the adoption of VPS solutions among start-ups, small enterprises, and large enterprises.

Integration of machine learning and AI with VPS

Machine learning is a data science procedure that enables computers to use prevailing data to forecast forthcoming outcomes, trends, and behaviors. The website owners that depend on big data do not need to invest in expensive hardware to process all the collected information. However, virtual private server allows them to run even the complex algorithms without hampering the functioning of their website. For instance, SAP machine learning research team has already been working on integrating Amazon Virtual Private Cloud (VPC) infrastructure with machine learning to ensure data privacy. Moreover, artificial intelligence (AI) can enable load balancing solutions, monitoring of server performance, and control over disk in virtual private servers by leveraging past information.

Virtual Private Server Market
By Region
2026
North America 
Europe
Asia-Pacific
LAMEA

Asia-Pacific would exhibit the highest CAGR of 18.9% during 2019-2026.

Key Benefits for Virtual Private Server (VPS) Market:

  • This study presents the analytical depiction of the global virtual private server market trends and future estimations to determine the imminent investment pockets.
  • A detailed analysis of the VPS market segments measures the potential of the market. These segments outline the favorable conditions for the market.
  • The report presents information related to key drivers, restraints, and opportunities.
  • The current VPS market is quantitatively analyzed from 2018 to 2026 to highlight the financial competency of the industry.
  • Porter’s five forces analysis illustrates the potency of buyers & suppliers in the industry.

Key Market Segments

By Type

  • Managed VPS
  • Unmanaged VPS

By Operating System

  • Windows
  • Linux

By Organization Size

  • Large Enterprises
  • Small & Medium Enterprises

By Industry Vertical 

  • IT & Telecommunication 
  • Retail
  • BFSI
  • Manufacturing
  • Healthcare
  • Others

By Region

  • North America
    • U.S.
    • Canada
  • Europe 
    • Germany
    • France
    • UK
    • Rest of Europe
  • Asia-Pacific 
    • Japan
    • China
    • India
    • Rest of Asia-Pacific
  • LAMEA
    • Latin America 
    • Middle East
    • Africa

Key Market Players Profiled In the Report

  • Amazon Web Services Inc.
  • DreamHost LLC
  • Endurance International Group
  • GoDaddy Operating Company LLC
  • IBM
  • InMotion Hosting
  • Liquid Web
  • OVH
  • Rackspace US Inc.
  • United Internet AG

Virtual Private Server Market Report Highlights

Aspects Details
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By TYPE
  • Managed VPS
  • Unmanaged VPS
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By OPERATING SYSTEM
  • Windows
  • Linux
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By ORGANIZATION SIZE
  • Large Enterprises
  • Small & Medium Enterprises
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By INDUSTRY VERTICAL
  • IT and Telecommunication
  • Retail
  • BFSI
  • Manufacturing
  • Healthcare
  • Others
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By Region
  • North America  (U.S., Canada, Mexico)
  • Europe  (France, Germany, Italy, Spain, UK, Russia, Rest of Europe)
  • Asia-Pacific  (China, Japan, India, South Korea, Australia, Thailand, Malaysia, Indonesia, Rest of Asia-Pacific)
  • LAMEA  (Brazil, South Africa, Saudi Arabia, UAE, Argentina, Rest of LAMEA)

Analyst Review

Global virtual private server market in Europe and Asia-Pacific is growing at a rapid rate and has immense scope for enhancement. In addition, these regions have a positive return on investment and possess strong opportunity in the virtual private server hosting attributable to favorable economic conditions due to development of various industries. Moreover, virtualization is maturing in these regions due to shift in preference of organizations from initial cloud approaches to virtualization of servers. Furthermore, increase in security concerns and upsurge in adoption of cloud-based services among enterprises drive the market growth for virtual private servers. Integration of machine learning and AI with virtual private servers is further expected to offer a major opportunity for the market growth.

The healthcare sector is expected to garner significant market share during the forecast period, due to rise in need for secure and accessible electronic health records (EHRs) among medical organizations. In addition, high demand for secured virtualized infrastructure among IT-based enterprises is expected to drive the market growth. The adoption of VPS is further expected to augment in BFSI institutes, owing to its ability to provide virtualization of applications from a single server to multiple nodes, which will propel the global market growth.

Furthermore, the market for virtual private server is consolidated, as players such as Amazon Web Services, Inc. (AWS), International Business Machines Corporation (IBM), Endurance International Group, GoDaddy Operating Company, LLC, and others hold a major share globally. However, the market is expected to become fragmented in the near future, as many players in developing countries are evolving in this area and coming up with enhanced and innovative VPS solutions and strategies.

The key players operating in the global virtual private server market include Amazon Web Services, Inc., DreamHost, LLC, Endurance International Group, GoDaddy Operating Company, LLC, IBM, InMotion Hosting, Liquid Web, OVH, Rackspace US, Inc., and United Internet AG. The key players have adopted various growth strategies to enhance and develop their product portfolio, strengthen their virtual private server market share, and to increase their market penetration. For instance, in December 2018 Bluehost, an Endurance International Group company launched WP Pro, a web hosting package that is optimized for WordPress websites. WP Pro includes add-ons such as Jetpack analytics, CodeGuard, domain privacy, and Sitelock in an easy-to-use customer marketing center.

Author Name(s) : Bhushan Jagtap | Onkar Sumant

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Virtual Private Server Market

Global Opportunity Analysis and Industry Forecast, 2019-2026