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The data center IT equipment market size is estimated to grow at a CAGR of 9.09% between 2022 and 2027. The market size is forecast to increase by USD 65.26 billion. The market's growth depends on several factors, including the rise in adoption of multi-cloud and network upgrades to support 5G, The increasing investments in data centers, and the growth of big data analytics. Data center IT equipment refers to the physical hardware and components used to support and operate data centers, which are facilities that house computer systems and associated components, such as servers, storage devices, networking equipment, and power infrastructure.
This data center IT equipment market report extensively covers market segmentation by product (server equipment, storage equipment, network equipment, and others), end-user (IT and telecommunication, BFSI, government and public, healthcare, and others), and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The increasing investments in data centers are driving growth in the data center IT equipment market. A number of companies are building or leasing data centers to cope with the growing volume of data produced. The increasing interest in cloud computing will further drive the need for data centers. Many firms have been investing in the construction of new data centers.
Moreover, organizations are investing in data centers to meet the needs of cloud computing, big data analytics, artificial intelligence (AI), and other data-intensive applications. Demand for information technology equipment in data centers will be increased by increasing investment in global data centers and, in turn, will boost the growth of the market in focus during the forecast period.
The growing need for edge computing is a key trend in the data center IT equipment market. The architecture model for processing data generated by IoT devices on the network's edge is Edge computing, which is mostly close to the source of the data. The growing number of connected devices will lead to the generation of large volumes of data.
Moreover, many industries, including manufacturing, utilities, retail, automotive, and social media, are using IoT for increased data transmission. The proliferation of 5G networks, which require edge data centers to handle the increased network traffic and minimize latency, further fuels the demand for data center IT equipment. Thus, the growing need for edge computing will drive the growth of the global data center IT equipment market during the forecast period.
Insufficient IT budget allocations is a major challenge faced by the data center IT equipment market. Service providers in data centers, particularly local operators, are restricted due to lower IT budgets and may not be able to build additional data center facilities. The construction of smaller data centers will lead to the installation of fewer data center IT equipment.
Additional infrastructure requirements from data center operators result in higher CAPEX. The deployment of IT equipment such as servers, storage devices, and networks is hindered by budget constraints. These factors pose major challenges to emerging vendors with lower capabilities for CAPEX, which will negatively impact the growth of the global data center IT equipment market during the forecast period.
The market share growth by the server equipment segment will be significant during the forecast period. Servers serve as the backbone of data centers, facilitating the storage, processing, and distribution of data for various applications and workloads. Data center servers process data, operate applications, and store information that is being processed by applications. A server has memory, a network, processors, and different ports.
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The server equipment segment showed a gradual increase in the market share of USD 41.32 million in 2017 and continued to grow by 2021. The demand for server equipment is driven by the increasing adoption of cloud-based services, the proliferation of data-intensive applications, and the growing need for scalable and high-performance computing solutions. The server equipment used by enterprises, service providers, and hyperscale data center operators is essential for their operation.
Data centers are critical infrastructure for the IT and telecommunication industry as they provide the necessary computing power and storage for various applications and services. Cloud computing has become a popular way for businesses to access computing resources such as central processing units (CPU), computer memory, file storage, and (I/O devices without investing in expensive hardware and infrastructure. In order to handle large datasets, data analysis and machine learning applications require a high-performance computing resource that is capable of handling big datasets which has led to the development of specialized data centers as well as IT equipment for Data Centres. Overall, the growth of data centers in the IT and telecommunication industry is expected to continue as technology evolves and new applications and services that require increasingly powerful computing resources emerge, which, in turn, will boost the growth of the global data center IT equipment market during the forecast period.
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North America is estimated to contribute 38% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The US is the major contributor to the data center IT equipment market in North America. The adoption of 5G technology has made the telecommunications sector in North America a pioneer. The region's 5G technology roadmap includes the penetration into applications such as connected cars, smart homes, fleet management, smart cities, smart parks, and connected devices. The demand for data center solutions is expected to increase in North America, driven by increasing demand for 5G-connected Internet of Things solutions and a growing number of industries requiring high connectivity with low latency, which, in turn, will increase the demand for data center IT equipment in the region during the forecast period.
The outbreak of the COVID-19 pandemic in 2020 propelled the growth of the data center IT equipment market in North America in 2020. However, in 2021, with COVID-19 vaccination programs in full swing across the region, banking and financial service companies resumed their in-office operations. The outbreak of the COVID-19 pandemic has accelerated the shift to remote work and online learning, despite the resumption of routine operations, which, in turn, spurred demand for cloud-based services, including cloud storage, collaboration tools, and video conferencing. Investments in expanding business operations are being made by a number of major suppliers. The initiatives by key market players will substantially drive the growth of the data center IT equipment market in North America during the forecast period.
The Data Center IT Equipment Market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Data Center IT Equipment Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Cisco Systems Inc. - The company offers data center IT equipment such as data center solutions for small and large enterprises, under its subsidiary called ALE International SAS.
CoreSite Realty Corp. - The company offers data center IT equipment such as data center computing and storage, data center networking servers, and data center routers.
Eaton Corp. Plc - The company offers data center IT equipment such as Intelliscale AI with workload-specific data center solution servers.
The research report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The data center IT equipment market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
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Data Center IT Equipment Market Scope |
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Report Coverage |
Details |
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Page number |
189 |
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Base year |
2022 |
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Historic period |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 9.09% |
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Market growth 2023-2027 |
USD 65.26 billion |
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Market structure |
Fragmented |
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YoY growth 2022-2023(%) |
7.77 |
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Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
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Performing market contribution |
North America at 38% |
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Key countries |
US, Canada, China, Germany, and the UK |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Arista Networks Inc., Cisco Systems Inc., CoreSite Realty Corp., CyrusOne LLC, Eaton Corp. Plc, Equinix Inc., Extreme Networks Inc., Fortinet Inc., Fujitsu Ltd., Hewlett Packard Enterprise Co., Huawei Technologies Co. Ltd., IEI Integration Corp., Infineon Technologies AG, Juniper Networks Inc., NetApp Inc., Nokia Corp., Oracle Corp., Schneider Electric SE, China Huaxin Post and Telecom Technologies Co. Ltd., and International Business Machines Corp. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
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Customization purview |
If our report has not included the data you are looking for, you can reach out to our analysts and get customized segments. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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