Sustainability initiatives seen driving data center physical infrastructure demand
A recently published report from Dell’Oro Group states that data center physical infrastructure (DCPI) revenues are forecast to grow at an 8 percent compound annual growth rate (CAGR) from 2021 to 2026, to above $31 billion.
According to the analyst, growth in the market is forecast to remain resilient, driven by sustainability-minded data center expansion from cloud and colocation service providers -- despite near-term supply chain constraints persisting and macroeconomic headwinds forming.
“Demand for data center physical infrastructure remains resilient, despite the developing macroeconomic uncertainties,” said Lucas Beran, principal analyst at Dell’Oro Group. “Most importantly, data center sustainability has risen to the top of decision-making criteria in the industry, opening the door for significant technology transitions during this forecast period."
Beran added, "The most exciting is the acceleration of data center liquid cooling, as both direct liquid cooling (DLC) and immersion cooling (single-phase and two-phase) are forecast to grow significantly and surpass $1 billion in market revenue by 2026."
Additional data points from the analyst's Data Center Physical Infrastructure 5-Year July 2022 Report include the following:
- DCPI revenue growth is forecast to slow to 6 percent in 2023, driven by continued cloud and colocation service provider growth and marginal enterprise growth.
- China is forecast to grow at the fastest CAGR during the forecast period, followed by APAC (Excluding China) and EMEA.
- Data Center Thermal Management is forecast to grow the fastest rate of any market segment during the forecast period, surpassing $6 B in vendor revenues in 2026.
- The Service Providers (Top 10 Cloud, Rest-of-Cloud, Colocation, and Telco) customer segment is forecast to grow at a double-digit CAGR during the forecast period, while the Enterprise customer segment (Large Enterprise, Rest-of-Enterprise) is forecast to grow at a much lower rate.
Dell’Oro Group’s Data Center Physical Infrastructure 5-Year Forecast Report covers market sizes and forecasts for uninterruptible power supplies (UPS), thermal management, cabinet power distribution and busway, rack power distribution, IT racks and containment, and software and services. Additional product level detail is provided for each market segment. Allocation of manufacturing revenues by cloud service providers, telco, colocation, and enterprise customer segments is also provided.