Data Center Equipment Market size is expected to witness notable proceeds from 2021 to 2027 with the consistent developments in social media, and big data. The recent influx of digitization of information across numerous organizations along with the rising requirement for high security, data backup, and storage capabilities as well as better operational efficiencies has made way for the personalized data centers. The increasing deployment of quantum computing is another key factor poised to drive the market growth.
Data centers can be addressed as secure facilities that house IT infrastructure, including networked computers and data storage. The large IT networks mainly constitute servers, storage systems, switches among other components.
In terms of product, servers are anticipated to record significant adoption with the increasing need to make data accessible to computers in data centers. They operate as a saving location and offer centralized information storage and processing to assist organizations with efficient and smooth operations.
Telecommunications is the most common application that will foster the data center equipment market expansion on account of the proliferating demand for internet-enabled services. The increasing penetration of online banking and electronic stock trading has highlighted the need for integrity, high standards, and safety to handle the massive amount of information. The surging requirement for data storage and management in the healthcare arena to handle electronic medical records will be another contributor to the market demand.
On the basis of regional segmentation, U.S. is set to emerge as a lucrative revenue pocket for the data center equipment market due to the expanding telecommunication sector and the rise in technological advancements. The emergence of various applications for business operations and data generation, including e-discovery, increasing acceptance of cloud services, and server virtualization will remarkably add to the regional growth.
Novel device launches for portfolio expansions as well as partnerships through acquisitions and mergers are some major business strategies undertaken by the leading data center equipment providers to reinforce their global presence and gain a competitive edge.
Digi International, Alcatel-Lucent, Brocade Communication Systems, Inc. (Broadcom Inc.), Meru Networks (Fortinet), Hewlett-Packard, Emulex Corp. (Broadcom Inc), F5 Networks, and Schneider Electric are some of the leading participants in the business.
For instance, in September 2020, NEC Corp., joined hands with NTT Communications, to come up with a data center cooling system that uses less energy, with the help of R1224yd, a new low-pressure refrigerant.
Likewise, in July 2019, Cisco Systems acquired Acacia Communications, an optical component maker through a purchase of USD 2.6 billion in cash in order to expand its product base for data center operators and telcos.
The COVID-19 pandemic not only imposed an unprecedented setback on the health and global economy but also made way for massive road backs to most industrial sectors. The stringent lockdown policies regulated by governments across various parts of the world drew a terrific blow on trade, resulting from the shuttering of manufacturing activities and disrupted supply chains. However, the industry observed a mix of both positive and negative impacts led by the online booming services in the lockdown and the stalled enterprise activities, such as data center consolidation respectively.
The outbreak brought complications in physically moving servers and the abrupt closing of buildings and the opening of new spaces. Datacenter construction as well as mergers and acquisitions that saw a go-ahead in the initial days of the lockdown are now likely to slow down with the supposed difficulties in physical activities. Owing to this, data centers, along with other firms in the IT sector are at the disposal of strong government support in order to keep up with the services and staff employment.