What are Modular Data Centers and How Can They Help?

Editor’s Note: This blog post was originally published in April 2023. It was updated in November 2025 to include the latest information.

Agility is vital as companies continue to accelerate innovation and future-proof their businesses. Participation in the digital economy demands access to physical infrastructure at software speed, or companies risk losing competitive advantage.

Increased AI adoption is one factor that’s driving demand for physical data centers. New data center builds were once relatively rare, with the full build cycle taking up to five years. Now, operators are often pursuing multiple builds simultaneously, and the average development cycle is down to 18-24 months for the first site in a given territory.[1]

Challenges await as companies begin designing and constructing new facilities near or far. Building traditional data centers from the ground up can be risky, expensive and time-consuming, especially for companies that lack relevant experience:

• Delays can occur when securing the necessary local permits and licenses to start the project.
• Unexpected environmental or ecological issues may arise.
• Supply chain constraints could include delivery delays or limited availability of materials.
• Hiring local general contractors with technical expertise often takes significant time and effort.
• Health and safety risks may arise, as dozens or even hundreds of workers navigate around heavy equipment, trucks and each other.

Given these barriers to data center construction, it’s no surprise that some companies are redirecting their resources to install modular data centers. In this blog post, we’ll explore why prefabricated modular data centers will play a central role in the future of IT infrastructure and how they can support sustainability initiatives.

Advance multiple use cases with modular data center installations

Modular data centers are built from prefabricated modules that make up the building structure and systems such as the electrical, plumbing and cooling. The options range from building an entire facility, to a hybrid of select pre-built modules, to a bundled solution incorporating office space and meeting rooms.

Module design, building and testing are completed in controlled environments free from severe weather conditions, worker shortages and other factors that typically cause delays with stick-build construction. Once testing is complete, the manufacturer ships modules for assembly and testing on location. This approach requires fewer resources throughout the process than on-site construction.

Equinix BX1 data center in Bordeaux, France

Modular data centers are a best-fit solution for use cases focused on enabling business agility, accelerating speed to market or meeting a specific business requirement. Four of the most common business needs for modular data centers are:

• Establishing all-in-one data centers in a new region
• Attaching power modules to existing facilities in space-constrained urban areas
• Locating data centers near subsea cable landing stations for easy access to bandwidth
• Installing facilities at edge locations for proximity to end users

Installing prefabricated modular data centers can enable specific use cases such as:

• Meeting hyperscaler expansion requirements
• Improving network connectivity and expanding data storage capabilities with advanced 5G cell towers
• Providing memorable digital experiences in sports stadiums
• Introducing high-density systems into legacy environments
• Accessing renewable energy sources in new markets to achieve carbon-neutrality targets
• Supporting WFH staff by providing remote storage and access to organizational data
• Integrating the internet of things (IoT) and automation systems for enhanced operational efficiency

Installing prefab modular data centers can add value across industries, including cloud and networking capabilities, customer experience and employee engagement. Businesses can use them to deploy and adapt faster.

Equinix BX1 data center in Bordeaux, France

Manage production risk with best practices

Off-site manufacturing of data center modules streamlines the build process, but you should still maintain production guardrails. For example, it may be tempting to customize your module design. Doing so will likely require retrofitting the manufacturing lines, adding cost and increasing the delivery timeframe. Here are some other best practices:

• Start small, but design your module configurations for scalability.
• Ensure airtight coordination of the design and build processes among suppliers of various modules.
• De-risk the project by completing as much testing as possible in the off-site production environment.
• Hire general contractors with renewable energy expertise to help ensure reliable access to power in remote locations.
• Integrate liquid cooling, now considered the optimal cooling system for modular data centers.

Finally, work with established suppliers with the required expertise and insights for building modular data centers that meet your needs.

Off-site construction in factory environments improves product quality and reduces waste. The reduction of embodied carbon in building materials and lower resource consumption during construction means that the whole building life cycle assessment (WBLCA) of a prefabricated building can be lower than that of one built from the ground up.

With an effective prefabrication waste management plan, data center operators can increase materials recycling, strengthen inventory control and protect building materials. Disassembling modular facilities is a simple process and makes it easier to recycle or repurpose end-of-life materials, which lowers their WBLCA carbon impact.

How modular data centers fit into the Equinix strategy

As discussed in this article, modular data centers make it possible to provide physical and virtual connectivity in remote locations and support many other use cases. Equinix has installed a modular data center in Bordeaux, France, and our West African portfolio is made up of 100% modular data centers located across Nigeria, Ghana and Côte d’Ivoire.

A logical next-step expansion under consideration is installing modular data centers in North Africa. Many challenges exist in this region, including the lack of a proven supply chain. We plan to design, manufacture and test modules with established manufacturers in Africa and arrange to transport the modules to our sites for assembly and final testing.

Simultaneously, we’re creating a portfolio of prefabricated modular data center designs for replication in locations worldwide. We have long-term partnerships with several global suppliers that will help accelerate expansion plans to support our customer and service provider requirements for digital infrastructure.

By taking a standardized, modular approach, we can deploy a smaller facility with retail Equinix IBX® colocation data center capabilities in a much faster timeframe. Our carrier-neutral modular data centers will offer a range of data center colocation services and digital services (including Equinix Fabric® and Equinix Network Edge) that help customers bring together and interconnect their digital infrastructure.

Learn more about how our data center design and construction strategies help address issues like embodied carbon and reliable access to clean and renewable energy: Access our interactive sustainability report.

[1] The future of the data center is modular, Data Center Dynamics, April 9, 2025.