Data Center Cooling Market revenue to hit USD 220 Billion by 2035, says Research Nester

Prominent data center cooling market players include Airedale International Air Conditioning Ltd., Asetek, Inc., Black Box Limited, Nortek Air Solution LLC, Vertiv Group Corporation, Rittal GmBh & Co.KG, Stulz Gmbh, Johnson Controls International plc, Intel Corporation, and ST Engineering Ltd.

New York, Jan. 16, 2024 (GLOBE NEWSWIRE) -- The global data center cooling market size is slated to expand at ~15% CAGR between 2023 and 2035. The market is poised to garner a revenue of USD 220 billion by the end of 2035, up from a revenue of ~USD 16 billion in the year 2022.This growth is driven by the increasing adoption of cloud computing and data-intensive applications such as machine learning and artificial intelligence. Over 62% of all corporate data worldwide is stored in cloud environments. Cloud data centers contribute to around 4% of the energy consumption. The revenue generated by cloud infrastructure services amounts to a USD 170 billion annually.

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An overwhelming majority of enterprises about 92% have embraced the adoption of multi cloud infrastructures. With the increasing amount of data and need for computing power, the need for efficient cooling solutions has become essential for the success of these data centers. As a result, there has been an increase in demand for cooling solutions that can help reduce the energy and operational costs of these data centers.

Growing Reliance on Digitalization and Rapid Adoption Of Edge Computing to Boost Market Growth

As more businesses rely on digital services such as cloud computing, data storage, and analytics, they require data centers to store and process their data. As data centers become more complex and require more cooling capacity, the demand for cooling solutions, including Data Center Cooling, will increase. Data centers generate a lot of heat, so they need cooling solutions to keep the temperature of their servers and other equipment at optimal levels. Cooling solutions also need to be energy-efficient and cost-effective, as data centers consume large amounts of energy.

Moreover, edge computing is becoming increasingly popular as it allows businesses to process data closer to its source, thus reducing latency and increasing efficiency. The number of network edge data centers is expected to increase to just under 1,300 by 2026, from just under 240 in 2022. This increased need for processing power is driving demand for data centers, which in turn is driving demand for cooling solutions.

 Data Center Cooling Market: Regional Overview

The market is segmented into five major regions including North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa region. 

Increasing Demand For Data-Intensive Applications Such As Video Streaming, Gaming, And Cloud Computing to Drive the Growth in the Asia Pacific Region

The data center cooling market in Asia Pacific region is estimated to garner the largest revenue by the end of 2035 driven by the increasing demand for data-intensive applications such as video streaming, gaming, and cloud computing. As of 2022, India's video streaming industry had surpassed 90 million subscribers. According to data released in February 2022, there are about 700 million live streaming users in China. This indicates that there is a massive demand for data-intensive applications in the region, which in turn is driving the need for data centers to provide reliable cooling solutions. Additionally, the rising demand for energy-efficient cooling solutions and growing awareness about the environmental impact of data centers are expected to drive the Asia Pacific data center cooling market.

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The Growing Demand For Streaming Services to Drive the Growth in the North America Region

The North America data center cooling market is estimated to garner the largest revenue by the end of 2035 driven by the growing demand for streaming services, as well as the increasing amount of data being generated, has resulted in a need for more data centers and more powerful cooling systems. Additionally, the North America region is expected to remain the leader in the market due to its high concentration of data centers. Approximately 5,300 data centers were reported in the United States as of September 2023. This high concentration of data centers is due to the region's robust economy, large population, and high concentration of tech companies. Additionally, the region's strong infrastructure, such as its power grid, makes it an attractive location for data centers.

Data Center Cooling Segmentation by End User

  • BFSI
  • IT & Telecom
  • Manufacturing
  • Retail
  • Healthcare

The IT & Telecom segment is anticipated to hold the largest revenue by the end of 2035 driven by the increasing demand for more efficient cooling solutions to cope with the increasing use of data centers for data storage and processing. Additionally, the need for reliable cooling solutions to prevent equipment overheating is also expected to drive this segment's growth. Moreover, as more and more organizations deploy IT infrastructure and telecom networks, they require more data centers, which will lead to increased demand for cooling solutions. The amount of money enterprise organizations spent on cloud infrastructure services in 2022 was 220 billion U.S. dollars. This is expected to rise in the coming years as organizations continue to migrate their workloads to the cloud, which will require more efficient cooling solutions.

Data Center Cooling Segmentation by Data Center

  • Large
  • Medium
  • Small-Scale DC

The large scale segment is anticipated to hold the largest revenue by 2035, driven by its requirement for more energy-efficient cooling solutions, as large-scale data centers consume more power and require larger cooling units. As of the end of 2021, there were 690 hyperscale data centers around the world. Additionally, a large number of hyperscale data centers are located in areas where the cost of cooling is high, which further drives the demand for more efficient cooling solutions. Furthermore, the large scale segment is also more likely to adopt new cooling technologies, such as Artificial Intelligence (AI)-driven cooling, which are expected to improve energy efficiency and reduce operational costs.

A few of the well-known industry leaders in data center cooling market that are profiled by Research Nester are Airedale International Air Conditioning Ltd., Asetek, Inc., Black Box Limited, Nortek Air Solution LLC, Vertiv Group Corporation, Rittal GmBh & Co.KG, Stulz Gmbh, Johnson Controls International plc, Intel Corporation, ST Engineering Ltd., and other key market players.

Recent Development in the Market

  • In July 2022 ST Engineering, a defense and engineering group ventured into the data center cooling market with the introduction of cooling technology. This technology aims to assist operators in climates by reducing energy consumption by 20% resulting in savings of approximately SGD 104 per kilowatt hour of heat load annually.
  • Intel invested USD 700 million into a research center focused on liquid and immersion cooling to prioritize data center sustainability. In May 2022 Intel made an effort to promote the adoption of this method worldwide by introducing the initial standard layout, for immersion cooling on the market.

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