Data Center Rack Market Research Report 2024

Global Data Center Rack Market Synopsis

Global Data Center Rack Market Size Was Valued at USD 4.00 Billion in 2023 and is Projected to Reach USD 8.82 Billion by 2032, Growing at a CAGR of 9.18 % from 2024-2032.

A data center rack is a structure utilized for organizing and housing servers, computing equipment, networking devices, and other hardware in a data center or server room. These shelves are constructed from metal and feature upright columns with perforations for installation. They are available in various sizes and configurations such as 23-inch racks, 19-inch racks, and others, according to industry norms.

• These shelves provide secure and organized spaces for IT gear like servers, switches, routers, storage devices, and other items. Moreover, they have built-in functionalities or the option to add a cooling system for maintaining the appropriate temperature for the enclosed devices.
• Data center rack solutions are used across different industries such as IT & telecom, banking and financial services, government, retail, and healthcare. A data center rack is primarily created to house servers of different sizes and shapes, including rack-mounted or blade servers. Although their primary function is to support servers, certain racks are also created to house additional components like networking equipment, telecommunication equipment, cooling systems, and UPS.
• The expansion of the data center market is mainly due to businesses and organizations widely using cloud computing services, substantial investments from private equity firms, infrastructure funds, sovereign wealth funds, and other organizations in the data center industry, and the swift implementation of 5G globally.
• 5G technology allows for quicker data transfer rates and reduced delays, leading to the increased use of data-heavy applications like high-quality video streaming, AR, VR, and IoT devices. The increase in data flow requires data centers to increase their infrastructure to manage the greater volume of work, which results in a greater need for data racks to store servers, networking equipment, and storage devices.
• Data center racks may vary in their form factor, such as rack-mounted servers or blade servers. Most racks are created with designated spaces intended for easy connection of electrical, networking, and internet cables. Proper data center cooling is also crucial. Racks that facilitate airflow enable the movement of air to cool the parts. Racks can protect important equipment from damage caused by accidents or natural disasters like earthquakes. Therefore, numerous companies in sectors such as IT and retail are implementing data center racks because of the advantages they offer.

Key Industry Player:

"Hewlett Packard Enterprise Development LP (U.S.), Dell Technologies Inc. (U.S.), IBM Corporation (U.S.), Cisco Systems, Inc. (U.S.), Vertiv Group Corp. (U.S.), Nvent Electric plc (U.S.), Oracle Corporation (U.S.), Super Micro Computer, Inc. (U.S.), Belden Inc. (U.S.), Chatsworth Products, Inc. (U.S.), Tripp Lite (U.S.), Panduit Corp. (U.S.), Great Lakes Case & Cabinet Co., Inc. (U.S.), AFCO Systems (U.S.) Schneider Electric SE (France), Legrand SA (France), Rittal GmbH & Co. KG (Germany) Huawei Technologies Co., Ltd. (China), Fujitsu Limited (Japan), and other active players."

Global Data Center Rack Market Trend Analysis

Increased Demand for Expansive Data Storage Capacity

• There is a strong increase in demand for the Global Data Center Rack Market due to the continuous rise in data storage needs globally. The increase is mainly driven by various reasons, such as the rapid growth of online content and the widespread use of cloud computing. The rise in data produced has exploded due to the incorporation of social media, video streaming, gaming, and digital entertainment into everyday routines. The increase in digital content requires a large storage infrastructure with data center racks to manage and store huge amounts of data effectively.
• The increase in data analytics has heightened the demand for expansive data storage capacity. Businesses in different industries are more and more using big data to gain insights, improve efficiency, and make informed choices. The crucial role of data center racks in supporting servers and storage units is highlighted by the need to store, process, and analyze large amounts of data.
• The increase in Internet of Things (IoT) devices has played a major role in the expansion of data, as these devices constantly produce vast amounts of data that require instant storage and processing capacities. The increasing use of digital services and applications worldwide underscores the essential role of data center racks in supporting the growing data storage requirements of the modern digital age.

Renewable Energy Integration

• Energy efficiency and sustainability are now extremely important in the data center sector, with data center racks being essential for meeting these objectives. Stakeholders, including governments and consumers, are increasingly concerned about the environmental effects of data centers, such as their energy usage and carbon emissions.
• To tackle these issues, data center operators are more and more embracing energy-efficient rack designs. These racks are designed to enhance airflow and cooling to decrease the energy needed to maintain correct operating temperatures. Developments like cold aisle containment and hot aisle containment systems, frequently combined with racks, improve cooling efficiency, creating a valuable market potential for advanced rack solutions.
• The increasing focus on sustainability is pushing data centers to research renewable energy sources and advanced power distribution methods to reduce their environmental footprint. Data center racks are being created with adaptations for these changes, such as modular power distribution units (PDUs) to enable efficient power management. The move towards incorporating renewable energy and maximizing power utilization supports worldwide sustainability objectives and creates opportunities for selling specialized rack solutions.
• Businesses with the capability to provide sustainable energy-integrated racks and advanced power distribution will have a competitive advantage in meeting the requirements of environmentally aware data center operators, while also contributing to minimizing the industry's carbon footprint.

Global Data Center Rack Market Segment Analysis:

Global Data Center Rack Market Segmented by Rack type, Data center size, rack height, Industry.

By Rack Type, The Cabinets/Enclosed Racks Segment Is Expected to Dominate the Market During the Forecast Period.

• Cabinets and enclosed racks will dominate the data center rack market share throughout the projected timeframe. The equipment is physically secure within the locked enclosures of these racks. Given the emergence of generative AI and the expanding AI workloads, many users swiftly sought out fresh IT infrastructure.
• Amazon Web Services (AWS), Microsoft, and Google are currently providing substantial computing power to customer locations, including private data centers, central offices, and on-premises sites in companies. This enables customers to develop and manage cloud-based apps from their premises, using the service provider's platform.
• Enclosed racks provide a greater degree of physical security and equipment protection when compared to open-frame racks. The strong side panels and doors with locks help safeguard the equipment from threats such as dust and unauthorized access. Increased security is particularly important for data centers that manage important and confidential data.

By Application, The IT & Telecom Segment Held the Largest Share.

• The IT & telecom sector is leading the market with the biggest market share. IT section covers the data center infrastructure needs of IT and telecommunications service providers, cloud service providers, and other technology-focused industries. The IT and telecom industry is one of the biggest users of data center racks.
• To meet the demands of data processing, storage, and networking needs, the technology industry necessitates strong and adaptable infrastructure due to its ongoing development. Data center racks are necessary to store servers, switches, and other important hardware components. The need for high-density racks that can effectively handle space and power is increasing due to the growing demand for cloud services and 5G connectivity.
• The growth in utilization of cloud computing, big data analytics, and artificial intelligence by these sectors is fueling the need for high-performance and scalable data center infrastructure, such as racks and enclosures.
• The increased utilization of edge computing and expansion of 5G networks are also driving the need for distributed infrastructure solutions that can accommodate the changing IT and telecom environment. Therefore, the IT and telecom sector are projected to lead the way in the data center rack and enclosure market, driven by a growing emphasis on data security, compliance, and energy efficiency.

Global Data Center Rack Market Regional Insights:

North America is Expected to Dominate the Market Over the Forecast Period

• The North American data center rack market was the leading market because of the advanced infrastructure and abundance of data center facilities in the region. The need for better performance and increased space utilization is expected to drive up the demand for data center racks.
• The development in this area is due to the quick use of data centers, the increase in the use of AI applications in different industries, and robust technology investment supported by government funding and help. The local expansion can also be credited to the existence of reputable IT software and hardware companies like HPE, Dell Inc., Vertiv Group Corp., and others. The high concentration of IT & telecom companies in nations like the U.S. and Canada boosts the expansion of data centers and their offerings in the area.
• In North America, the market for data center racks is known for its strong IT infrastructure and advanced technology usage. The area has a well-established data center environment, with many data centers catering to different sectors. The increasing need for data center racks in North America is fueled by the ongoing expansion of data-centric applications, cloud computing, and the rise in IoT devices. Businesses in North America place importance on efficient data storage and management, resulting in a continuous need for high-density racks and advanced cooling solutions. Furthermore, the region's dedication to sustainability and energy efficiency is driving the uptake of environmentally friendly rack designs.

Active Key Players in the Global Data Center Rack Market

• Hewlett Packard Enterprise Development LP (U.S.)
• Dell Technologies Inc. (U.S.)
• IBM Corporation (U.S.)
• Cisco Systems, Inc. (U.S.)
• Vertiv Group Corp. (U.S.)
• Nvent Electric plc (U.S.)
• Oracle Corporation (U.S.)
• Super Micro Computer, Inc. (U.S.)
• Belden Inc. (U.S.)
• Chatsworth Products, Inc. (U.S.)
• Tripp Lite (U.S.)
• Panduit Corp. (U.S.)
• Great Lakes Case & Cabinet Co., Inc. (U.S.)
• AFCO Systems (U.S.)
• Schneider Electric SE (France)
• Legrand SA (France)
• Rittal GmbH & Co. KG (Germany)
• Asia Pacific Countries:
• Huawei Technologies Co., Ltd. (China)
• Fujitsu Limited (Japan)

Key Industry Developments in the Global Data Center Rack Market:

• In January 2024, Google announced a $1 billion investment in a new data center in Waltham Cross, 15 miles north of central London. The 33-acre site, purchased in 2020, will bolster the tech giant's presence in the UK, meeting growing regional demand for internet services. This significant investment underscores Google's commitment to expanding its infrastructure in key markets.

• In March 2023, Vertiv, a global leader in digital infrastructure solutions, launched the Vertiv Intelligent Fingerprint Rack Access Control System (iFACS) in India. This next-generation IP-based solution enhances data center security by providing physical protection for racks containing critical equipment, assets, and enterprise data. The innovative system ensures that only authorized personnel can access sensitive areas, significantly boosting security measures for mission-critical operations. The Vertiv iFACS is now available to customers across India, marking a significant advancement in data center protection technology.