The data center racks market was valued at USD 4044.8 million in 2018, and it is expected to reach a value of USD 6302.2 billion by 2024, at a CAGR of 7.9% during the forecast period (2019)
NEW YORK, June 21, 2019 /PRNewswire/ -- Market Overview
The data center racks market was valued at USD 4044.8 million in 2018, and it is expected to reach a value of USD 6302.2 billion by 2024, at a CAGR of 7.9% during the forecast period (2019 - 2024). Data centers have witnessed growth, owing to the increasing dependence and spending on cloud technologies recently.
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- Data centers are critical to enterprises operating in the present borderless world, globally. Whether private or public, the data center is essential for hosting mission-critical applications. These data centers help organizations streamline information while enabling easy access to users and customers from anywhere across the world.
- With the help of the hyperscale data centers web services, numerous companies apply algorithms to the models that can recognize, classify, and analyze relationships in the data, and can be used to recommend content, tag photos, and deliver relevant advertising.
- The growing deployment of data centers around the world is the major driving factor influencing the consumption of data center racks. The increasing demand for technology services and increasing investments from major companies are also influencing the growth of the market.
- With changing technologies and the adoption of high density servers, rack infrastructure has become an important aspect in data centers, with the need to effectively host servers, manage cables, and facilitate air flow for ensuring the optimum performance of data centers.
Scope of the Report
A data center rack is a type of physical steel and electronic framework that is designed to house servers, networking devices, cables, and other data center computing equipment. Data center racks are deployed, primarily for infrastructure management in data centers. These are being used in the manufacturing, retail, BFSI, IT and telecom industry.
Key Market Trends
IT & Telecom Sector Expected to Hold a Significant Share
- IT and Telecom is the most significant segment for this market. The IT infrastructure requirement is the highest for this segment. Colocation providers, who are a major adopter of data center racks, are also considered under the scope of the study under the IT & Telecom sector.
- The amount of data that is being stored and processed by this segment is huge. The advent of mobile data and subscriptions and their rapid usage has proliferated the growth of data traffic and hence data centers. With the introduction of 5G and Cloud, the demand is expected to increase exponentially. Major companies are investing in new infrastructure to meet the additional requirements. Companies, like American Tower, bought its first data centers in April 2019 through the acquisition of Colo Atl.
- Other regions like Singapore also witnessed a rapid expansion in April 2019. The data center, colocation, and interconnection provider, Digital Realty commenced the construction of its third data center facility in Singapore. The facility will be capable of supporting up to 50 megawatts (MW) of IT capacity. The new facility will span a gross floor area of 34,000 sq. meter.
- Moreover, with the number of colocation providers growing significantly, and expanding in remote locations, it is expected that the demand for integrated data center racks is expected to witness significant growth during the forecast period.
Asia-Pacific Region to Record the Highest Growth Rate
- In the Asia-Pacific region, the market is anticipated to witness rapid growth, owing to increasing data traffic, energy efficiency and growing need for deployment of data centers in economically developing countries, such as India and China, are boosting the growth of the data center rack market in the Asia-Pacific region.
- The market is witnessing a rise in the number of businesses coupled with the shifting trend toward digitalization of all processes. In India, the number of data centers are growing, owing to government projects, such as Digital India, Make in India, Smart Cities, growth in the internet penetration, and the strong resurgence of growth-related projects across different verticals, such as e-commerce and retail, IT/ITeS, BFSI (primarily non-critical workloads).
- Data center investments are expected continue to grow in Asia-Pacific, with investor interest rising in the emerging markets of China, India, Singapore, and Indonesia. Tencent is constructing a data center in the hills of Guizhou, China, reportedly designed to the highest standards of civil air defense.
- The Singapore government is anticipated to move the bulk of its IT systems to commercial cloud services over the forecast period in ongoing efforts to deliver citizen services in a faster and cheaper way. This is anticipated to impact the market's growth positively. The evolution of Japan into more of an international data center market has been driven by the global hyperscale clouds expanding in the Tokyo and Osaka markets.
Competitive Landscape
The data center rack market is fragmented. With changing technologies and the adoption of high density servers, rack infrastructure has become an important aspect in data centers, with the need to effectively host servers, manage cables, and facilitate air flow for ensuring optimum performance of data centers. Overall, the competitive rivalry among the existing competitors is high. The new innovative strategies of large companies are driving the data center racks market.
- February 2019 - Schneider Electric SE announced the launch of Masterpact MTZ, the first-of-its-kind air circuit breaker in the market that provides the customer with multiple benefits of enhanced performance, increased reliability, and safety. This is the next generation of high power low voltage circuit breakers, combining the company's legendary performance and reliability with new digital capabilities.
- January 2019 - Oracle Cloud Infrastructure opened a new data center in Toronto, to combat some of the ongoing performance and security concerns that some Canadians have faced in the past pertaining moving to the cloud.
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