Data center rack market headed for $8.56 billion by 2030: Report

Jan. 3, 2023
The data center rack market grew to $4.08 billion in 2021 and is expected to register a CAGR of 8.6% during the forecast period through 2030, according to the latest analysis by Emergen Research.

The data center rack market reached $4.08 billion in revenues in 2021 and is expected to register a CAGR of 8.6% during the forecast period through 2030, according to a new report by Emergen Research.

Rising number of data center facilities coupled with increasing implementation of advanced technologies such as Artificial Intelligence (AI), Internet of Things (IoT), and Machine Learning (ML) among others across various end-use industries are a few of the factors driving market revenue growth.

Increasing usage of such technologies is leading to a high requirement for storage of vast volumes of data which is boosting the demand for data center racks. High demand for secure and off-site storage, as well as improved connectivity, is driving demand for such data center rack facilities.

As recapped by the analyst, racks consolidate IT equipment, such as servers and network switches, into standardized assemblies that maximize space and other resources.

Moreover, rack technology helps in increasing power protection, cable management, cooling, device management, mobility, physical security, simplicity of installation, and protection from extreme climatic conditions, which is one of several factors expected to boost demand for data center racks.

Via rack technology, organizations may use various IT department functions without making huge investments, whereas medium to large organizations can increase data storage capacity while avoiding overhead and resource-intensive maintenance expenses.

Furthermore, the new report notes that rack colocation enhances security by supplying power, bandwidth, and a public IP address to storage devices. Technologies such as virtualization and containerization, blockchains and cryptocurrencies, edge computing, and cloud services are increasing demand for high processing power and high-density racks.

Case study

As recounted by the new report from Emergen Research, in December 2022, VNG Corporation, which is a well-recognized global standard for classifying data center performance in electromechanical infrastructure, announced the launch of a new data center in Ho Chi Minh City, marking a significant step forward for VNG in offering a full-tier III facility that is carrier neutral.

This new world-class data center is now operational, offering excellent uptime infrastructure for all digital service platforms, secure data storage, and innovative cloud solutions, as well as complementing the company's current cloud services for its Vietnamese clients.

The data center is expected to be critical in delivering strong and secure infrastructure solutions for VNG's clients as well as internal requirements, with the facility constructed to Tier III Uptime standards and equipped with technology to improve energy efficiency and availability.

Market drivers

Development of data-hungry technologies such as IoT, AI, and ML with an increase in data generation are some of the key factors driving demand for data center racks, according to Emergen Research. \

The new report sees high demand for computer processing is surging with the increasing reliance on power-extensive workloads such as Business Intelligence (BI) and dashboards, custom and ad hoc analytics, hybrid operational and analytic processing, data science, as well as batch processing among others. Rapid growth of e-sports industry is another key factor contributing to the growth of market owing to requirements of high-performance and low latency.

The analysis finds recent surge in hyperscale deployments is expected to significantly boost the revenue growth of market. On 29 March 2022, Yondr Group, a global leader, developer, owner-operator, and service provider of data centers, entered the Malaysian market with the acquisition of 72.8 acres of property from TPM Technopark Sdn Bhd, which is a fully owned subsidiary of Johor Corporation. The property is ideally positioned in Sedenak Tech Park, a flagship data center complex spanning 700 acres in Johor, Malaysia.

Market restraints

Presence of Hyperconverged Infrastructure (HCI) and cooling concerns that lead to overheating are factors that are expected to provide some restraints on the growth of market. Electronic equipment cannot function effectively if the temperature is not properly calibrated, and rack servers require a strong cooling system which contributes to high cost of energy. Furthermore, insufficient scalability of rack servers owing to internal space limitations is expected to drive some reluctance among potential customers over the forecast period.

Growth projections

The data center rack market is expected to register a CAGR of 8.6% over the forecast period and revenue is projected to increase from USD 4.08 Billion in 2021 to USD 8.56 Billion in 2030. Rising demand for data center colocation facilities is expected to support the revenue growth of the market.

Current trends and innovations

Various trends such as AI and Light Detection and Ranging (LIDAR) technology are emerging that can help secure data centers. Smart technology has been rapidly adopted by businesses and consumers, resulting in broad device internet connectivity via IoT networks. Data centers are required to meet growing computing power with an increase in blockchain technology and cryptocurrency mining.

Browse a full report description and Table of Contents

For more news, projects, and profiles in the ICT cabling and connectivity sphere, subscribe to the CI&M newsletter and follow us on LinkedInTwitter, and Facebook.

About the Author

Cabling Installation & Maintenance Staff

Cabling Installation & Maintenance publishes news and technical information for information and communications technology (ICT) professionals.

Sponsored Recommendations

imVision® - Industry's Leading Automated Infrastructure Management (AIM) Solution

May 29, 2024
It's hard to manage what you can't see. Read more about how you can get visiability into your connected environment.

Global support of Copper networks

May 29, 2024
CommScope designs, manufactures, installs and supports networks around the world. Take a look at CommScope’s copper operations, the products we support, our manufacturing locations...

Adapt to higher fiber counts

May 29, 2024
Learn more on how new innovations help Data Centers adapt to higher fiber counts.

Going the Distance with Copper

May 29, 2024
CommScopes newest SYSTIMAX 2.0 copper solution is ready to run the distanceand then some.