Global Data Center Cooling Market Size, Segmentation, Trends and Growth Analysis Forecast by 2030

Data Center Cooling Market Overview and Analysis:

The Data Center Cooling Market is currently valued at USD 17.9 billion USD in the year 2022 and is expected to register a CAGR of 17.8% over the forecast period, 2023-2030.

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Data center cooling is the system that maintains the ideal operating environment for all of the equipment in a data center. Since data centers have a combined consumption of about three percent of the world's electricity, there is a significant amount of electricity generating heat.

The growing use of OTT and streaming services has resulted in increased data volumes and the rise in digitization leading to an increase in computing power, demanding the integration of large chips into data centers is fueling the growth of the studied market.

Data Center Cooling Market Latest Trends:

Artificial intelligence (AI) and machine learning are playing a pivotal role in optimizing data center cooling operations. AI-driven algorithms analyze real-time data to fine-tune cooling parameters for maximum efficiency. Notably, Google employs DeepMind AI to optimize cooling systems in its data centers, resulting in substantial energy savings. Schneider Electric, for instance, has introduced cooling solutions specifically designed for edge data centers to address challenges related to space constraints and energy efficiency. Thus, the market is expected to witness significant growth over the forecast period.

Segmentation:

The Data Center Cooling Market is segmented

By Solution

• air-cooled
• liquid-cooled
• Chillers
• Economizer Systems,
• Row/Rack/Door/Overhead Cooling Systems

By Service

• Installation and Deployment
• Consulting
• Support
• Maintenance Services

End-user Vertical

• Information Technology
• BFSI
• Telecommunication
• Healthcare
• Government

Geography

• North America
• Europe
• Asia-Pacific
• Rest of the World

The market sizes and forecasts are provided in terms of value in USD billion for all the above segments.

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Drivers:

Rising Data Center Demand:

The relentless growth of data-driven applications and cloud services has created an insatiable need for data centers. As these facilities expand, the demand for efficient cooling solutions to maintain optimal performance is surging. For instance, industry giants like Amazon Web Services and Microsoft Azure, who are continuously expanding their data center footprint, rely on advanced cooling systems to prevent overheating and ensure uninterrupted service. Thus, the market is expected to witness significant growth over the forecast period.

The market development is fueled by the growing use of OTT and streaming services, which has resulted in increased data volumes. The increasing amount of data generated by online streaming services, such as Disney+ Hotstar, Hulu, and Netflix, will drive the demand for data center cooling systems that deliver effective cooling performance. There is a rising need in the market to ensure that data center cooling providers have the capacity and capability to provide high-performance products that can work efficiently during peak traffic periods.

Restraints:

Initial Investment Costs:

Adopting advanced cooling solutions can entail substantial upfront investments, covering the acquisition and installation of specialized equipment. For instance, the introduction of liquid cooling systems may necessitate infrastructure modifications and significant capital expenditure.

Complexity of Integration:

Integrating new cooling technologies into existing data center infrastructure can be intricate and potentially disruptive. Ensuring compatibility and minimizing downtime pose significant challenges. Retrofitting an established air-cooled data center with liquid cooling technology, for example, calls for meticulous planning and execution.

COVID-19 Impact On Data Center Cooling Market

The COVID-19 pandemic has had a positive impact on the market, leading to an increased adoption of artificial intelligence and machine learning solutions. It demonstrated the power and sophistication that artificial intelligence could bring to the healthcare sector, transforming it completely. As the number of patients in hospitals increased, so did the adoption and application of robotically assisted medical surgeries, artificial intelligence-based virtual assistants, inpatient care bots, and other technologies.

Segmental Analysis:

Air-Cooled Cooling Data Center is Expected to Witness Significant growth Over the Forecast Period

Air-cooled data center cooling is a system that uses air as the primary medium to dissipate heat generated by IT equipment. It involves the circulation of cool air within the data center space to regulate temperature. Air-cooled systems are generally more cost-effective to install and maintain compared to liquid-cooled alternatives. They require less infrastructure and are easier to set up, making them a preferred choice for smaller data centers or businesses with budget constraints. Moreover, Air-cooled systems offer flexibility in terms of layout and scalability. They can be easily adapted to changing IT equipment configurations or data center expansions without major modifications. Thus, the segment is expected to witness significant growth over the forecast period.

Installation and deployment in the Segment are Expected to Witness High Growth over the Forecast Period.

Datacenters in cloud computing are integral to any enterprise, developed to support business operations and offer services like Data management, storage, recovery, and backup. High-volume online transactions. Support applications like e-mail, payment gateways, etc.

Information Technology in the Segment are Expected to Witness High Growth over the Forecast Period.

Information Technology (IT) and data cooling centers, often referred to as data centers, are specialized facilities designed to house and manage computer systems, servers, networking equipment, and data storage devices. Cooling is a critical component of data center infrastructure to ensure the reliable operation of IT equipment and prevent overheating, which can lead to costly downtime and equipment damage.  Thus, the segment is expected to witness significant growth over the forecast period.

Asia-Pacific Region is Expected to Witness Significant Growth Over the Forecast Period.

The Asia-Pacific market is expected to witness high growth in the future. China is one of the significant markets for data center cooling solutions due to the exponential growth in data generation from advanced technologies such as IoT, ML, and artificial intelligence. The government’s policies to support more energy-efficient infrastructure in the country further contribute to this growth. India has also witnessed significant growth due to the increasing adoption of Internet services and the high flow of data. Rising government investments in data centers are propelling the Asia-Pacific market. According to Arizton’s latest report, the APAC market witnessed an addition of over 100 hyperscale data center facilities and expansion projects this year. Last year, the investment in higher-speed Ethernet switches remained strong, driven mainly by the demand from hyperscale data centers, cloud providers, and an increase in data center investments. With hyperscale facilities growing, the need for data center cooling systems will increase. According to the Energy Consumption of Data Centers in China, the current numbers of small- and medium-sized data centers in China exceeded 400,000, and the annual total power demand reached 100 billion kWh, i.e., around 250,000 kWh for each data center, annually. The rising trend of data localization in the country may further promote the development of data centers, thereby contributing to the studied market growth in the region.

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Competitive Analysis:

The data center cooling market is fragmented as the benefits offered by the technology and support from the government by imposing efficiency regulations on data centers are expected to help the growth of the data center cooling market directly. Market penetration is growing with a strong presence of major players in established markets. With the increasing focus on innovation, the demand for new technologies is growing, which, in turn, is driving investments for further developments. Key players include:

• Vertiv Co.
• Schneider Electric SE
• STULZ GMBH
• Daikin Industries Ltd
• Mitsubishi Electric Corporation
• Johnson Controls International PLC

Recent Developments:

1) July 2022 - Defence and engineering group ST Engineering entered into the data center cooling market with the launch of a cooling technology that supposedly helps operators in tropical climates achieve 20% in energy savings, which translates to about SGD 104 per kilowatt-hour of heat load every year.

2) May 2022 - Intel launched a new initiative to address data center sustainability with a USD 700 million investment into a new research facility specializing in liquid and immersion cooling. Along with this, it unveiled the first immersion cooling reference design in the market to promote the use of the technology in data centers worldwide.

Frequently Asked Questions (FAQ) :

Q1. What is the current Data Center Cooling Market size?

Q2. What is the Growth Rate of the Data Center Cooling Market?

Q3. What segments are covered in the Data Center Cooling Market Report?

Q4. What positive Impact did COVID-19 have on the Data Center Cooling Market?