"Smart Strategies, Giving Speed to your Growth Trajectory"

Data Center Rack Market Size, Share & Industry Analysis, By Rack Type (Cabinets/Enclosed Racks and Open Frame Racks), By Data Center Size (Small and Mid-sized Data Centers and Large Data Centers), By Rack Height (40U and Below, 41U up to 50U, and Above 51U), By Industry (BFSI, Retail, IT & Telecom, Government, Healthcare, and Others), and Regional Forecasts, 2024-2032

Last Updated: October 21, 2024 | Format: PDF | Report ID: FBI108475

 

KEY MARKET INSIGHTS

Play Audio Listen to Audio Version

The global data center rack market size was valued at USD 5.73 billion in 2023 and is projected to grow from USD 6.21 billion in 2024 to USD 13.80 billion by 2032, exhibiting a CAGR of 10.5% during the forecast period (2024-2032).


A data center rack is a frame used to store and arrange servers, computing equipment, networking devices, and other hardware in a data center or server room. These racks are made of metal and have vertical posts with holes for mounting. They come in different sizes and configurations such as 23-inch racks, 19-inch racks, and more, based on industry standards.


These racks offer safe and orderly areas for IT equipment such as servers, switches, routers, storage devices, and more. Additionally, they come with built-in features or can be fitted with a cooling system to ensure the right temperature for the enclosed equipment. Data center rack solutions are utilized in various sectors including IT & telecom, BFSI, government, retail, and healthcare. A data center rack is mainly designed to store servers of various shapes and sizes, such as rack-mounted or blade servers. While their main purpose is to accommodate servers, some racks are also designed to hold other components, such as networking equipment, telecommunication equipment, cooling systems, and UPS.


The data center market growth is majorly attributed to the widespread adoption of cloud computing services by businesses and organizations, significant capital inflow by private equity firms, infrastructure funds, sovereign wealth, and other organizations into the data center ecosystem, and the rapid rollout of 5G across the world. 5G technology enables faster data transmission speeds and lower latency, driving the proliferation of data-intensive applications such as high-definition video streaming, augmented reality (AR), virtual reality (VR), and Internet of Things (IoT) devices. This surge in data traffic necessitates the expansion of data center infrastructure to handle the increased workload, leading to a higher demand for data racks to house servers, networking equipment, and storage devices.


The novel coronavirus pandemic augmented market growth due to the increased use of tech, social media & online streaming, and a rapid shift to remote working. According to the Asia Pacific Investor Intentions Survey by CBRE, in 2020, around 30% of respondents across the Asia Pacific region considered investing in data centers during the COVID-19 pandemic, a remarkable growth from 18% recorded in 2019.


IMPACT OF GENERATIVE AI


Increased Computational Demand for Training and Deploying Generative AI Models to Fuel Market Growth


Generative AI-powered chatbots have been making waves since the launch of ChatGPT. The ChatGPT is an AI chatbot that represents a major advancement in generative AI systems and has the potential to transform several industries. The growing adoption of generative AI applications is anticipated to increase demand for IT infrastructure. Generative AI has significantly impacted the architecture of AI clusters, needing a larger neural network and more hardware. This, in turn, results in the consumption of multiple megawatts of power, requiring denser server racks and cutting-edge cooling systems.


The energy required to train various AI models is contributing to high carbon emissions, prompting data center operators to prioritize more innovative and sustainable IT infrastructure to minimize their carbon footprint. Furthermore, due to the requirement of high computational power and storage, AI applications drive the demand for specialized racks capable of supporting high-density computing and storage infrastructure, leading to increased sales of racks.  


Data Center Rack Market Trends


Rise in Adoption of High-density and Modular Rack Designs to Propel the Market Growth


Data center operators are increasingly adopting high-density racks to accommodate more computing power in smaller footprints. This trend is majorly driven by the need for energy efficiency and space optimization in hyperscale data centers. As per the "2022 Global Data Center Survey" by Uptime Institute, more than a third of data center operators stated that their rack densities have increased rapidly in the last three years. This shift is majorly driven by the rapid adoption of high-performance computing (HPC) applications in aerospace, seismic engineering, 3D modeling, research and development, simulation, Artificial Intelligence (AI), weather forecasting, big data analytics, and 3D film rendering.


Traditional air cooling cannot dissipate the extreme heat generated by servers in a high-density rack, making it crucial for rack vendors to upgrade cooling technology systems. In high-density racks, liquid cooling solutions are majorly used to manage the heat generated by servers. These solutions use coolant to efficiently dissipate heat from servers and other hardware. Moreover, the racks used in data centers are becoming more modular, allowing for easy scalability. This approach simplifies the adoption or removal of equipment as needed, aligning with changing business requirements. Modular data center racks are equipped with efficient cable management solutions for reducing clutter and improving airflow. Innovations in cable management within racks help optimize data center performance.


Request a Free sample to learn more about this report.


Data Center Rack Market Growth Factors


Increasing Number of Data Center Facilities across the Globe to Boost Market Growth


Data centers play an important role in efficiently managing vast amounts of data generated from digital services, Internet of Things (IoT) devices, social media, and online transactions. As a result, businesses and organizations require more data center capacities to store and process this data. As per Avendus Capital Private Limited, data centre market in India is poised to reach around 1,700 MW capacity by 2025 at approximately 40% CAGR, attracting USD 5 billion. The increasing demand for data storage and processing capacity fuels the construction of data centers, thereby driving the demand for racks to house server equipment.


Increasing concerns about energy consumption and environmental impact generated by data centers is another major factor attributed to the data center rack market growth. According to Vertiv Group Corp., data centers were responsible for about 3% of global electricity consumption in 2022 and are expected to reach 4% by 2030. This has led to the adoption of energy-efficient data center infrastructure, including racks designed to optimize airflow and cooling efficiency, thereby reducing operational costs and environmental footprint.


Governments and regulators across the world are closely monitoring the development of data centers to address sustainability concerns emerging from energy-intensive facilities and are imposing sustainability standards on newly built data centers. For instance,



  • In January 2024, a new data center efficiency bill HB 116 was presented in the Virginia House of Delegates, mandating data center operators to meet various energy efficiency conditions. As per the bill, the operators of data centers would only be eligible for sales and utilize tax exemptions if they achieve a power usage effectiveness score of 1.2 or less.


Such developments are anticipated to increase the demand for racks with optimal airflow management, thereby reducing environmental impact.


RESTRAINING FACTORS


Supply Chain Disruptions and High Initial Investment to Hamper the Market Growth


Global supply chain disruptions caused by ongoing geopolitical instability, material shortages, macroeconomic volatility, manufacturing delays, and transportation bottlenecks impact the availability and cost of data center racks. These supply chain challenges are anticipated to delay timely deployments and strain procurement of rack components and accessories.


In addition, building and maintaining data center facilities, including racks, is expensive. This includes costs related to construction, cooling systems, electricity, and ongoing maintenance. Cost considerations can impact the decision to expand or upgrade rack infrastructure for some price-sensitive customers. High-density racks generate more heat, which requires robust cooling solutions, presenting a challenge in balancing power and cooling needs. Incorporating new racks into existing data center facilities can be complex and time-consuming. Compatibility issues, interoperability challenges, and the requirement of skilled personnel to handle rack deployment and maintenance can pose restraints for organizations. 


Data Center Rack Market Segmentation Analysis


By Rack Type Analysis


Growing Importance of Physical Security of the Equipment to Augment Cabinets/Enclosed Racks Demand


Based on rack type, the market is segmented into cabinets/enclosed racks and open frame racks.


Cabinets/enclosed racks to hold major data center rack market share during the forecast period. The locked enclosures of these racks ensure physical security for the equipment. With the rise of generative AI and the need to quickly expand AI workloads, numerous users quickly looked for new IT infrastructure. Amazon Web Services (AWS), Microsoft, and Google are currently delivering large amounts of computing power to customer sites, such as private data centers, central offices, and on-premises locations within businesses. This allows customers to create and operate cloud-based applications from their own facilities, utilizing the platform provided by the service provider.


Additionally, the open frame racks segment is predicted to record the highest CAGR during the forecast period due to the numerous advantages offered they offer such as easy access to IT equipment and cabling, ease of installation, and cost-effectiveness. Open frame racks are inexpensive compared to enclosed server racks. The open frame racks are easier to ship, enabling customers to save money while buying, transporting, and installing it.


By Data Center Size Analysis


Large Data Centers Segment Dominated the Market Owing to Proliferation of Digital Technologies


Based on data center size, the market for data center rack is divided into small & medium-sized enterprises and large enterprises.


Large data centers dominated the market in 2023 due to the increasing demand for data storage and processing capacity across the world. This is driven by the proliferation of digital services, cloud computing, IoT, and big data analytics fuels the construction of large data centers, thereby driving the demand for racks to house server equipment.


Small and mid sized data centers are expected to grow with the highest CAGR during the forecast period, as they are cost-effective, flexible, and scalable, making it easier to adapt to a rapidly changing business landscape. In addition, they are easy to install and maintain. Their simplified operations, with less complexity in terms of infrastructure, networking, and equipment, contribute to their growth.


By Rack Height Analysis


41U up to 50U Rack Segment Dominated the Market Owing to Ability to Provide High Security to Data Center Equipment


Based on the rack height, the market is divided into 40U and below, 41U up to 50U, and above 51U.


41U up to 50U dominated the market in 2023, as 43U racks come with advanced locking mechanisms and other security features to safeguard the equipment from unauthorized access, adding an extra layer of physical security. Furthermore, enterprises can gain higher equipment density and consolidation using a 43U rack, minimizing the necessity for additional rack units and optimizing space usage.


40U and below racks are anticipated to expand at the highest CAGR, as they are more space-efficient and highly suitable for settings with limited available floor space including small server rooms or office closets. In addition, smaller racks are more inexpensive than larger ones, and they need less physical space, which results in lower construction and operational costs.    


By Industry Analysis


To know how our report can help streamline your business, Speak to Analyst


Increasing Dependence on E-commerce Operations Propels the Adoption of Data Center Racks in Retail


By industry, the market is categorized into BFSI, retail, IT & telecom, government, healthcare, and others (education and media & entertainment).


The retail segment dominated the data center rack market in 2023, as retailers with online stores and e-commerce platforms depend on data center racks for hosting their websites, managing databases, and facilitating online shopping applications. Moreover, these racks aid in efficiently monitoring and controlling inventory levels.


The healthcare sector is anticipated to grow at the highest CAGR in the coming years. The healthcare sector's growing focus on digital technologies leads to a significant increase in data, ranging from electronic health records (EHRs) to medical imaging. These storage systems ensure the safekeeping and organization of this sensitive information. As a result, the rapid adoption of digital technologies in healthcare is expected to drive market growth in the foreseeable future.


REGIONAL INSIGHTS


Geographically, the market for data center rack is studied across five major regions, including North America, South America, Europe, the Middle East & Africa, and the Asia Pacific. They are further categorized into countries.


North America Data Center Rack Market Size, 2023 (USD Billion)

To get more information on the regional analysis of this market, Request a Free sample


North America is expected to account for the largest market share during the forecast period. The growth in this region can be attributed to the rapid adoption of data centers, the surge in the adoption of AI applications across various sectors, and strong technology investment activity bolstered by government funding and support. The regional growth can also be attributed to the presence of well-established IT software and hardware providers such as HPE, Dell Inc., and Vertiv Group Corp., among others.


The U.S. has maintained its dominant position in the region due to the robust investment in AI research. As per the new report by Stanford University, the U.S. government spending on AI contracts reached around USD 3.3 billion in 2022. Furthermore, the U.S. boasts the highest number of data centers globally. In the U.S., Northern Virginia is currently the largest data center market in the world, with over 275 facilities. Additionally, Dallas/Ft. Worth, Chicago and Silicon Valley are witnessing significant construction activity. These advancements are expected to drive market expansion in the coming years.


To know how our report can help streamline your business, Speak to Analyst


Moreover, the Asia Pacific market is anticipated to show the highest growth rate due to the increasing demand for data storage and processing capacity in the region.  The proliferation of digital services, cloud computing, IoT, and big data analytics fuels the construction of data centers, thereby driving the demand for racks to house server equipment. The rollout of 5G networks and the expansion of telecommunications services across the region further augment market growth in the region. In 2019, South Korea became the first country across the globe to roll out a nationwide 5G network, followed by Australia, China, the Philippines, and New Zealand.  


The market in Europe is primarily fueled by robust AI and ML investments, the presence of high-quality digital infrastructure, and the rapid adoption of HPC. Many companies in Europe are investing in data center facilities to support digital government initiatives, public services, and data analytics. For instance,



  • In January 2024, Alphabet Inc. (Google) announced an investment of USD 1 billion in the U.K. for a new data center, aimed at addressing the rising demand for internet services in the country.    


In South America, the adoption of cloud-based solutions is expected to augment market growth. Brazil is anticipated to maintain its dominant position on account of the rapid adoption of Industry 4.0 technologies in the manufacturing sector, requiring racks to support automation, IoT devices, and data analytics in production environments. 


The Middle East & African countries are increasingly adopting digital technologies. The Gulf Cooperation Council (GCC) nations are increasingly spending on high-tech technology as part of economic transformation strategies. All these factors are expected to offer ample growth opportunities to market players in the region.  


List of Key Companies in Data Center Rack Market


Key Players Focused on Strengthening their Market Position to Boost their Product Portfolio


The global market is dominated by the leading players such as Schneider Electric SE, Vertiv Group Corp., Eaton Corporation plc, Cyber Power Systems, Inc., Legrand S.A., nVent Electric plc, Hewlett Packard Enterprise Development LP, Rittal GmbH & Co. KG, Dell Technologies Inc., and FUJITSU Limited.


These key players are expanding their operations by adopting strategies such as mergers, acquisitions, product launches, collaborations, and partnerships. For instance, in May 2023, nVent Electric plc launched RDHX PRO rear door coolers (RDC) for cooling high-density racks up to 78kW. RDC helps to meet the demand for the increasing use of AI-based applications, higher energy efficiency and sustainability, and the requirement for data center space utilization.


List of Key Companies Profiled:



  • Schneider Electric SE (France)

  • Vertiv Group Corp. (U.S.)

  • Eaton Corporation plc (Ireland)

  • Cyber Power Systems, Inc. (Taiwan)

  • Legrand S.A. (France)

  • nVent Electric plc (U.K.)

  • Hewlett Packard Enterprise Development LP (U.S.)

  • Rittal GmbH & Co. KG (Germany)

  • Dell Technologies Inc. (U.S.)

  • FUJITSU Limited (Japan) 


KEY INDUSTRY DEVELOPMENTS:



  • August 2023: Cyber Power Systems, Inc. redesigned their server racks and rack accessories to lighter and smaller models. The new server racks include CR42U11001, a 42U freestanding server rack, and three wall-mount rack models in various sizes from 6U to 12U.

  • March 2023: Vertiv Group Corp. launched Intelligent Fingerprint Rack Access Control System (iFACS) in India. iFACS helps to secure racks housing equipment, assets, and enterprise data.

  • February 2023: Eaton added Rittal GmbH & Co. KG, a manufacturer of enclosures to its xModular partner programme to augment innovations within the modular data center space.

  • May 2022: Legrand unveiled a new Nexpand configure-to-order cabinet series for data centers. Nexpand cabinets feature solid doors, and electronic temper-proof locks, with superior cable management system. Nexpand offers the scalability and sustainable architecture required to support the rise in Internet-of-Things (IoT) connectivity, 5G services, edge computing, and Artificial Intelligence (AI) applications.

  • April 2022: Rittal GmbH & Co. KG announced a partnership with TD SYNNEX Corporation, an IT distribution firm to distribute IT rack enclosures and accessories to information technology (IT) customers through TD SYNNEX.


REPORT COVERAGE


An Infographic Representation of Data Center Rack Market

To get information on various segments, share your queries with us



The report offers qualitative and quantitative insights into the market and a detailed analysis of the size & growth rate for all possible segments in the market. It also provides an elaborative analysis of market dynamics, emerging trends, and the competitive landscape. The report offers key insights, such as the implementation of automation in specific market segments, recent industry developments, such as partnerships, mergers, funding, acquisitions, consolidated SWOT analysis of key players, business strategies of leading market players, macro & micro economic indicators, and major industry trends. This detailed analysis provides a comprehensive view of the market and its potential for growth and development.


To gain extensive insights into the market, Request for Customization


REPORT SCOPE & SEGMENTATION










































ATTRIBUTE



DETAILS



Study Period



2019 – 2032



Base Year



2023



Estimated Year



2024



Forecast Period



2024 – 2032



Historical Period



2019 – 2022



Growth Rate



CAGR of 10.5% from 2024 to 2032



Unit



Value (USD billion)



Segmentation



By Rack Type



  • Cabinets/Enclosed Racks

  • Open Frame Racks


By Data Center Size



  • Small and Mid-sized Data Centers

  • Large Data Centers


By Rack Height



  • 40U and Below

  • 41U up to 50U

  • Above 51U


 By Industry



  • BFSI

  • Retail

  • IT & Telecom

  • Government

  • Healthcare

  • Others (Education and Media & Entertainment)


By Region



  • North America

    • U.S. (By Industry)

    • Canada (By Industry)

    • Mexico (By Industry)



  • South America

    • Brazil (By Industry)

    • Argentina (By Industry)

    • Rest of South America



  • Europe

    • U.K. (By Industry)

    • Germany (By Industry)

    • France (By Industry)

    • Italy (By Industry)

    • Spain (By Industry)

    • Russia (By Industry)

    • Benelux (By Industry)

    • Nordics (By Industry)

    • Rest of Europe



  • Middle East & Africa

    • Turkey (By Industry)

    • Israel (By Industry)

    • GCC (By Industry)

    • North Africa (By Industry)

    • South Africa (By Industry)

    • Rest of Middle East & Africa



  • Asia Pacific

    • China (By Industry)

    • Japan (By Industry)

    • India (By Industry)

    • South Korea (By Industry)

    • ASEAN (By Industry)

    • Oceania (By Industry)

    • Rest of Asia Pacific








Frequently Asked Questions

According to Fortune Business Insights, the global market is predicted to reach USD 13.80 billion by 2032.

In 2023, the market value stood at USD 5.73 billion.

The market is projected to record a CAGR of 10.5% during the forecast period of 2024 – 2032.

By rack type, cabinets/enclosed rack is expected to capture the major market share and lead the market.

Increasing number of data center facilities across the globe is a key factor boosting the market growth.

Some of the top players in the market are Schneider Electric SE, Vertiv Group Corp., Eaton Corporation plc, and others.

Asia Pacific is expected to show the highest growth rate due to the rapid 5G rollout and data center expansion in the region.

By industry, the healthcare segment is expected to grow at the highest CAGR during the forecast period.

Seeking Comprehensive Intelligence on Different Markets?
Get in Touch with Our Experts
Speak to an Expert
  • 2019-2032
  • 2023
  • 2019-2022
  • 170
Multi-report Purchase Plan
    A Customized Plan Will be Created Based on the number of reports you wish to purchase
Client Testimonials

“We are quite happy with the methodology you outlined. We really appreciate the time your team has spent on this project, and the efforts of your team to answer our questions.”

- One of the largest & renowned medical research centers based in the U.S. on a report on the U.S. NIPT Market.

“Thanks a million. The report looks great!”

- Feedback from a consultant on a report on the U.S. Beef Market.

“Thanks for the excellent report and the insights regarding the lactose market.”

- Brazil based company specializing in production of protein ingredients.

“I liked the report; would it be possible to send me the PPT version as I want to use a few slides in an internal presentation that I am preparing.”

- Global Digital Services Agency on a report on the Global Luxury Goods Market.

“This report is really well done and we really appreciate it! Again, I may have questions as we dig in deeper. Thanks again for some really good work.”

- U.S.-based biotechnology company focussing on treatment of chronic pain.

“Kudos to your team. Thank you very much for your support and agility to answer our questions.”

- Europe-based provider of solutions to automate data centre operations.

“We appreciate you and your team taking out time to share the report and data file with us, and we are grateful for the flexibility provided to modify the document as per request. This does help us in our business decision making. We would be pleased to work with you again, and hope to continue our business relationship long into the future.”

- India-based manufacturer of industrial and specialty intermediates with a strong global presence.

“I want to first congratulate you on the great work done on the Medical Platforms project. Thank you so much for all your efforts.”

- One of the largest cosmetics company in the world.

“Thank you very much. I really appreciate the work your team has done. I feel very comfortable recommending your services to some of the other startups that I’m working with, and will likely establish a good long partnership with you.”

- U.S. based startup operating in the cultivated meat market.

“We received the below report on the U.S. market from you. We were very satisfied with the report.”

- Global hearing aids manufacturer.

“I just finished my first pass-through of the report. Great work! Thank you!”

- U.S. based solar racking solutions provider.

“Thanks again for the great work on our last partnership. We are ramping up a new project to understand the imaging and imaging service and distribution market in the U.S.”

- World’s leading advisory firm.

“We feel positive about the results. Based on the presented results, we will do strategic review of this new information and might commission a detailed study on some of the modules included in the report after end of the year. Overall we are very satisfied and please pass on the praise to the team. Thank you for the co-operation!”

- Germany based machine construction company.

“Thank you very much for the very good report. I have another requirement on cutting tools, paper crafts and decorative items.”

- Japanese manufacturing company of stationery products.

“We are happy with the professionalism of your in-house research team as well as the quality of your research reports. Looking forward to work together on similar projects”

- One of the Leading Food Companies in Germany

“We appreciate the teamwork and efficiency for such an exhaustive and comprehensive report. The data offered to us was exactly what we were looking for. Thank you!”

- Intuitive Surgical

“I recommend Fortune Business Insights for their honesty and flexibility. Not only that they were very responsive and dealt with all my questions very quickly but they also responded honestly and flexibly to the detailed requests from us in preparing the research report. We value them as a research company worthy of building long-term relationships.”

- Major Food Company in Japan

“Well done Fortune Business Insights! The report covered all the points and was very detailed. Looking forward to work together in the future”

- Ziering Medical

“It has been a delightful experience working with you guys. Thank you Fortune Business Insights for your efforts and prompt response”

- Major Manufacturer of Precision Machine Parts in India

“I had a great experience working with Fortune Business Insights. The report was very accurate and as per my requirements. Very satisfied with the overall report as it has helped me to build strategies for my business”

- Hewlett-Packard

“This is regarding the recent report I bought from Fortune Business insights. Remarkable job and great efforts by your research team. I would also like to thank the back end team for offering a continuous support and stitching together a report that is so comprehensive and exhaustive”

- Global Management Consulting Firm

“Please pass on our sincere thanks to the whole team at Fortune Business Insights. This is a very good piece of work and will be very helpful to us going forward. We know where we will be getting business intelligence from in the future.”

- UK-based Start-up in the Medical Devices Sector

“Thank you for sending the market report and data. It looks quite comprehensive and the data is exactly what I was looking for. I appreciate the timeliness and responsiveness of you and your team.”

- One of the Largest Companies in the Defence Industry
We use cookies to enhance your experience. By continuing to visit this site you agree to our use of cookies . Privacy.
X