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Macroeconomic uncertainty and lingering supply chain constraints are currently short-term headwinds, however, long-term growth is forecast to remain resilient supported by sustainability-minded cloud and colocation data center expansions and on-premises enterprise modernization.
“Next generation processors and accelerators, from the likes of AMD, Intel, and NVIDIA, are rapidly changing the power and thermal management requirements for data center physical infrastructure,” said Lucas Beran, Principal Analyst at Dell’Oro Group. “The Thermal Design Power (TDP) of these semiconductor components continues to rise, with TDPs of 350W and 400W for the latest generation of CPUs, and up to 700W for GPUs. And product roadmaps show further increases from here. This is ultimately leading to higher rack power densities, with architectural changes in backup power, power distribution, and thermal management required.
“At the same time, data center sustainability has risen to the top of decision making, planning, and design criteria in the industry. This has opened the door for a significant technology transition during this forecast period – the transition from air to liquid-based thermal management. The two primary technologies, direct liquid cooling and immersion cooling (single-phase and two-phase), are forecast to grow significantly and reach $1.7 billion, or 24 percent, of thermal management revenue by 2027,” continued Beran.
Additional highlights from the Data Center Physical Infrastructure 5-Year January 2023 Forecast Report:
DCPI revenue growth is forecast to remain resilient in 2023, growing 9 percent, supported by historically high DCPI vendor backlogs.
Asia Pacific (Excluding China) is forecast to grow at the fastest CAGR during the forecast period, followed by EMEA and China.
Data Center Thermal Management is forecast to grow at the fastest rate of any market segment during the forecast period, surpassing $7 billion in vendor revenues in 2027.
The Service Providers (Top 10 Cloud, Rest-of-Cloud, Colocation, and Telco) customer segment is forecast to grow at a double-digit CAGR during the forecast period, while the Enterprise customer segment (Large Enterprise, Rest-of-Enterprise) is forecast to grow at a much lower rate.