Data center servers are one of the most energy-intensive building types, consuming 10 to 50 times the energy per floor space of a typical commercial office building. A data center server is a physical facility that organizations utilize for critical applications. A data center's server design is based on a network of computing and storage resources that possess the ability of shared applications and data. Modern data center servers are different from traditional ones. Infrastructure has shifted from traditional on-premises physical servers to virtual networks that support applications and workloads across the pool of physical infrastructure to a multi-cloud environment.

Market Drivers and Trends

Data Center Server Virtualization

Data center operators usually configure at least one physical server per application, accounting for testing/development, staging, and disaster recovery resulting in 3 to 5 servers per application as per the statistics revealed by the US Environmental Protection Agency.  According to a 2012 New York Times report, the average server utilization rate was 6 to 12 percent in the past. As a result, rather than running a large number of servers at low utilization, virtualization consolidates computing power into a smaller number of servers that run at higher overall utilization. Virtualization also increases scalability, decreases downtime, and allows for quicker implementation. Apart from that, virtual data servers accelerate recovery by allowing applications to be restarted much more quickly.

Consolidation of lightly utilized data center servers 

With an intention to reduce heat and high energy consumption, consolidation allows data center servers to be replaced with new server purchases and installation.  An examination of all servers and their utilization rates in most data centers would reveal servers that are performing single, infrequent, or minimal tasks. These servers will be consolidated to remove systems and save money on resources, hardware, and maintenance. In general, consolidation allows you to retire servers and/or postpone the purchase of new servers, reducing energy usage and waste heat. According to the Uptime Institute, decommissioning a single 1 U rack data center server will save $500 in electricity, $500 in operating system licenses, and $1,500 in hardware maintenance costs per year. Therefore, server consolidation by light utilized data center servers is a good idea today.  

Remote Management climbs towards all-time high growth 

As the new generation of Data Center Infrastructure Management (DCIM) incorporates cloud services, the cloud-based DCIM utilizes artificial intelligence (AI) to provide performance optimization and data modeling. Another fast-growing concept is Remote Infrastructure Management (RIM), in which a company's IT infrastructure can be handled entirely from a remote location. RIM is a valuable commodity that reduces costs, improves service availability, and improves efficiencies in the organization's IT processes. Unmanned data centers are also seen as an emerging trend that is expected to develop rapidly over the forecast period. Currently, centralized data centers handle about 90% of all business data. It is predicted that in 2021 and the following years it will grow at a rapid pace. This is one of the most important factors that will propel the data center server industry in the coming years. Companies will now share their IT workloads between off-site alignment with the providers and cloud hosting services due to the expense and implications of providing in-house servers and private clouds.

Market Segmentation

The data center servers market is segmented based on product, application, and verticals. By product, the market is segmented into rack servers, blade servers, micro servers, and tower servers. Based on application, the market is bifurcated into industrial servers and commercial servers. Furthermore, by verticals, the market is segmented as BFSI, IT and Telecom, Government and Defense, and others.

Regional Landscape

North America holds dominating share for the data center servers market globally

North America holds the largest share and will continue to do so in the coming years. The involvement of a large number of data center rack server vendors, as well as growing technology adoption among North American provinces, are the factors that contribute for the growth of data center servers market globally.

According to the United States Data Center Energy Use Study, data centers in the United States consumed an estimated 70 billion kW in 2014. The significant energy improvements in the design and operation of the data center over the past decade have allowed US data center energy use to remain constant as it was witnessed that there is a drastic increase in demand for data center services. Several measures are implemented by the department to save energy. One such implementation of modernized technology is the implementation of Improved Management (IM). Power Use Effectiveness (PUE) and the elimination of inactive servers are two major components of IM. Improved PUE is an attempt by smaller data centers to reduce their infrastructure energy demand by improving airflow and thermal management. By implementing successful PUE and IM, overall energy savings in 2020 was expected to be 2.5 percent from energy savings due to the elimination of inactive servers and 7.5 percent from infrastructure energy savings due to the decreased server energy coupled with increased PUE.

Europe, on the other hand, would account for a significant share of the global data centre servers industry. The increasing use of cloud computing services in Europe has resulted in an increase in the number of IT infrastructure components. In Europe, Finland, Denmark, and Sweden are the major countries that contribute to cloud adoption technologies that bolster the demand for data center servers in European markets. Additionally, data centre servers market in Asia Pacific is expected to grow at a significant rate in the coming years. The demand for new data centers is driven by the data connectivity platforms and a paradigm shift toward digitization. This is one of the most important factors driving the data centre servers market in the Asia Pacific region to its full potential.

Competitive Landscape

The prominent players of the data center servers industry involve Cisco Systems, Inc., The Hewlett Packard Enterprise Company, IBM Corporation, Fujitsu Limited, Lenovo, Oracle Corporation, Dell, and others.

Market Segmentation

Market By Product

Rack Servers
Blade Servers 
Micro Servers
Tower Servers

Market By Application

Industrial Servers 
Commercial Servers

Market By Verticals

BFSI
IT and Telecom
Government 
Defense
Others

Market By Geography

North America
•    U.S.
•    Canada

Europe
•    U.K.
•    Germany
•    France
•    Spain
•    Rest of Europe

Asia-Pacific
•    China
•    Japan
•    India
•    Australia
•    South Korea
•    Rest of Asia-Pacific

Latin America
•    Brazil 
•    Mexico
•    Rest of Latin America

Middle East & Africa
•    GCC
•    South Africa
•    Rest of Middle East & Africa