North America Data Center Cooling Market - Growth, Trends, Forecasts (2020 - 2025)
The North America Data Center Cooling Market is segmented by Solutions (Air Conditioners/Handlers, Chillers, Economizer Systems, Liquid Cooling Systems, Row/Rack/Door/Over-head Cooling Systems), Service (Installation and Deployment, Consulting Support and Maintenance Services), End-user Verticals (Information Technology, BFSI, Telecommunication, Healthcare, Retail, Government) and Country.
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Scope of the report
Key Market Trends
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The North America Data Center Cooling Market is expected to grow at a CAGR of 11.7% over the forecast period 2020 to 2025. Rise in need of efficient and cost-effective data centers, green initiatives for eco-friendly data center solutions, healthy growth with the data center, and power density drive the market growth. Furthermore, the development of modular, containerized, and performance-optimized data center (POD) facilities will boost demand in the data center cooling systems market in North America.
The United States dominated the overall North America data center cooling market size is due to the growth in the development of hyperscale and colocation facilities with a power capacity of more than 100 MW. The quantity of hyperscale data centers exceeded the 500 mark in 2019 globally. According to Cisco Systems, most data centers are located in the United States, with 38% of the global total.
However, according to CBRE, the trend among local enterprises had shifted from moving into colocation facilities to cloud options. For instance, according to Credit Suisse, the United States' share in the hyperscale data centers market has decreased from 47% in 2017 to 38% in 2019. Moreover, the higher number of expansion projects in South-Eastern and South-Western regions, especially in Virginia & Texas in the U.S., is the most significant revenue contributor.
The solution segment ruled the North America data center cooling market share due to the increase in the adoption of energy-efficient, environment-friendly, and cost-effective cooling solutions because of various governments' stringent environmental safety rules.
Tax incentives in Canada and South-Eastern and South-Western regions in the US will create new business opportunities for vendors in North America's data center market. Furthermore, the development of modular, containerized, and performance-optimized data center (POD) facilities will boost demand in the data center cooling systems market in North America.
However, Canada is anticipated to see the biggest growth rate in the North America data center cooling market owing to the rise in the number of data centers due to various factors which include low energy costs, bandwidth, political stability, and ease of doing business and others are expected to affect the market positively.
However, the requirement of specialized infrastructure and higher investment cost and cooling challenges during a power outage are anticipated to hinder the growth during the North America data center cooling market forecast period.
Furthermore, the emergence of liquid-based cooling and portable cooling technologies and growth in requirement for a modular data center cooling approach is anticipated to provide lucrative opportunities for the North America data center cooling market.
Scope of the report
The data center cooling relates to the combined equipment, tools, techniques, and methods that guarantee a perfect operating temperature within a data center facility. With growing capacity and greater density, there is a growing need for energy-efficient cooling of the IT equipment. Datacenter operators adopt datacenter cooling due to its energy-efficiency, eco-friendly, and cost-effective nature.
Liquid Cooling Systems
Row/Rack/Door/Over-head Cooling Systems
Installation and Deployment
Consulting Support and Maintenance Services
Other End-user Verticals
United States of America (USA)
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Key Market Trends
Substantial Growth with Data Center and Power Density to Drive the Market
In the recent past, there is an increment in the number of data centers. More processors are being used in a given space to increase the data centers' performance, which results in increasing density. The requirement of power and cooling has grown along with an increase in density.
According to Cisco Systems, it is forecasted that by 2021, there will be 7.2 million data centers in the world. Digital society's progression has generated an ever-greater amount of data, and it is predicted that by 2021, around 1,327 EB data would be stored in data centers - almost an 8-fold increase from 2015. Big data is a major driver of growth in stored data and is predicted to bulk overall data stored in data centers.
Firms in the region make efforts to make its data centers more effective through customized high-performance servers, using smart temperature and lighting, advanced and excellent cooling techniques, and machine learning. For instance, over the last few years, Google’s energy consumption has increased, reaching 10.6 terawatt-hours in 2018, up from 2.86 terawatt-hours in 2011.
Furthermore, data centers' power density experiences growth by an average of 1.5 kW per rack, which results in limited air distribution and enhanced heat generation. In general, the IT equipment typically needs between 100 and 160 cfm of air per kW, but in a dense environment, it diminishes to less than 100, which results in higher heat generation.
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Hyperscale Data Center to Witness Substantial Growth
Hyperscale data centers offer cloud spaces for cloud computing and big data storage. It mostly has at least 500 storage cabinets covering approx 10,000 sq. Ft of space having 5,000 servers connected with the ultra-high-speed fiber network offering with infrastructural cost to the end-user. According to Credit Suisse, the share of the United States in the hyperscale data centers market has decreased from 47% in 2017 to 38% in 2019.
According to Cisco, the total number of hyperscale facilities is expected to exceed more than 500 by the end of 2020, and Cisco even estimates that 53 percent of all data center traffic will pass through hyperscale facilities by 2020 in the United States.
According to a study by James Hamilton, power distribution and cooling systems cause around 82% of the data center infrastructural cost. Further, the underutilization of data center space costs with high CAPEX. Recently, larger-scale organizations are emphasized reducing their CAPEX and OPEX, which is driving the adoption of hyperscale datacenters in North America.
Players such as AWS, Microsoft, Google offers robust, scalable applications and storage portfolio of services to individuals or businesses. Further, a small town in the rural center of Washington State, Quincy, is home to several hyperscale data centers for companies including Microsoft, Yahoo, and Dell. Since the hyperscale data center is important for the construction of scalable and robust cloud, a large number of cloud service providers use it in the United States.
In September 2019, EdgeConneX declared a partnership with Lume for leveraging its Cloud Anyware services. The partnership enables them to accomplish goals like bringing its cloud solutions to the Edge, local, and highly proximate to its enterprise customers. EdgeConneX customers can leverage Lume’s Cloud Anyware service suite to deploy highly proximate dedicated private, virtual private, hybrid, and on-premise cloud solutions.
Further, the growth of the market expansion by the players in the region significantly assists in market growth. In January 2020, T5 has bought a 15.4MW data center shell near existing facilities in the Elk Grove Technology Park, near Chicago for enterprise hyperscale data center cloud. Its robust network infrastructure makes it an ideal location for both enterprise and hyperscale cloud companies in need of additional capacity.
Moreover, the US government started the Data Center Optimization Initiative (DCOI) for delivering better services to the public while increasing return-on-investment to taxpayers by consolidating many data centers in the country. The consolidation process includes the process for building hyperscale data centers and to shut-off the underperforming ones. Currently, the government has closed over 3,215 data centers in the country.
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The North America Data Center Cooling Market is highly competitive and consists of several major players. In terms of market share, few of these players currently dominate the market. Market penetration is growing with a strong presence of major players such as Schneider Electric SE, Black Box Corporation, Asetek, Nortek Air Solutions LLC, Emerson Electric Co., Hitachi, Ltd., Rittal GmbH & Co. Kg, Fujitsu Ltd., Stulz GmbH, and Vertiv among others in established markets and with the increasing focus on innovation, the demand for new technologies such as liquid-based cooling and portable cooling technologies is growing, which, in turn, is driving investments for further developments in the region.
June 2020 - Fujitsu announced the expansion of its storage portfolio with four new series of the Fujitsu Storage ETERNUS, that leverage NetApp's advanced data management software. This launch represents the next step of Fujitsu's strategic partnership with NetApp in offering a data management infrastructure that supports digital transformation.