The data center cooling market was valued at USD 8.07 billion in 2019 and is expected to reach a value of USD 16.62 billion by 2025 at a CAGR of 12.5% during the forecast period 2020-2025.
There has been a surge in the number of data centers due to high computational requirements by AI and Media applications. Furthermore, the growth is going to be fuelled by the adoption of edge computing and the increase in the number of IoT devices.
Development in IT Infrastructure in emerging countries is driving the market. The increasing construction of hyperscale facilities with a power capacity of over 50 MW will fuel the need for innovative infrastructure in the market over the next few years globally in developed countries. According to the National Association of Software and Services Companies (NASSCOM), IT exports from India may exceed USD 330 billion by 2019-20. This accounts for nearly 14% of the projected worldwide spend if India maintains its current share of the global offshore IT market.
The estimates by various sources suggest that the data center accounts for 2% to 5% of the global Green House Gas (GHG) emissions. The cooling systems are responsible for almost 40% of the power consumption in a data center. Companies are trying to tackle this issue by setting up Green data centers which use Free air cooling systems instead of traditional Air conditioners. The growing trends toward the deployment of green data centers for storing, managing, and distributing information helped many software companies reduce energy consumption and the total energy cost.
As the hyperscale providers roll out their services more widely across the Europe region, the rate of hyperscale procurement of data center capacity in many other European cities would increase rapidly. Hence, markets, such as Madrid, Milan, Warsaw, and Zurich would witness a substantial increase in colocation activity. Equinix announced a new joint venture with GIC to develop and operate hyperscale data centers in the Europe region. For the past many years, an important trend has been the expansion of large-scale facilities to support the growth of hyperscale companies, including the largest cloud service providers.
However, adaptability requirements and power outages are challenging the market to grow.A typical data center cooling system must be pre-engineered, standardized, and modular. It is required to be scalable and flexible to meet the needs of the data center. This is very difficult in today's world with companies looking to cut costs and not willing to spend much on the high-end customized cooling systems.
Key Market Trends
Information Technology Industry to Witness Highest Growth
The IT industry needs on-premise private data storage centers and hyperscale data centers for its operations according to the size of the organization. Additionally, the adoption of cloud storage has increased over the years due to growth in SaaS providers, which is enabling cloud storage providers to expand their capacities and is expected to increase the demand for data center cooling systems.
Cloud storage providers, like Microsoft, AWS, and Google, are expanding their storage capabilities to offer more efficient work-flow on the cloud. These companies are making investments in hyperscale deals. In May 2018, Google announced that it was adopting liquid cooling systems for AI data crunching, as the heat generated its new tensor processing units (TPUs) exceeded the limits of its previous data center cooling solutions.
Moreover, CloudHQ stated that, by 2022, the industry is expected to get the 350-megawatt storage campuses. In 2018, the company signed a 72-megawatt lease in Ashbum, which is the largest in the data center history.
In February 2018, the second-largest grocery chain in America, Albertsons Companies, announced the adoption of cloud storage service from Microsoft to improve the retail experience. With this, the company planned to leverage the cognitive analytics, AI, and data science capabilities from Microsoft. Such advancements among top retailers are expected to launch new data center establishments which will drive the demand of data center cooling market.
The data center cooling market is fragmented as the benefits offered by the technology and support from the government by imposing efficiency regulations on data centers are expected to directly help the growth of the data center cooling market. Market penetration is growing with a strong presence of major players in established markets and with the increasing focus on innovation, the demand for new technologies is growing, which, in turn, is driving investments for further developments. Key players are Vertiv Co., Schneider Electric SE, STULZ GMBH, etc.
Key Topics Covered:
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS 4.1 Market Overview 4.2 Industry Value Chain Analysis 4.3 Industry Attractiveness - Porter's Five Forces Analysis 4.4 Market Drivers 4.4.1 Increasing Volume of Digital Data 4.4.2 Emergence of Green Data Centers 4.5 Market Restraints 4.5.1 Adaptability Requirements and Power Outages
5 MARKET SEGMENTATION 5.1 Type 5.1.1 Air cooled 5.1.2 Liquid cooled 5.1.3 Chillers 5.1.4 Economizer Systems 5.1.5 Row/Rack/Door/Overhead Cooling Systems 5.2 Service 5.2.1 Installation and Deployment 5.2.2 Consulting, Support, and Maintenance Services 5.3 End-user Vertical 5.3.1 Information Technology 5.3.2 BFSI 5.3.3 Telecommunication 5.3.4 Healthcare 5.3.5 Government 5.3.6 Other End-user Verticals 5.4 Geography
6 COMPETITIVE LANDSCAPE 6.1 Company Profiles 6.1.1 Major Vendors 22.214.171.124 Daikin Industries, Ltd. 126.96.36.199 Schneider Electric S.E. 188.8.131.52 Mitsubishi Electric Corporation 184.108.40.206 Johnson Controls International plc 220.127.116.11 Asetek, Inc. 6.1.2 Other Vendors 18.104.22.168 STULZ GMBH 22.214.171.124 Rittal GmbH & Co. KG 126.96.36.199 Nortek Air Solutions 188.8.131.52 Vertiv Co. 184.108.40.206 Munters Group AB