Lucas Beran, research director at Dell’Oro Group, said AI will have a major impact on the data center market in the future.
“DCPI vendors are ramping up manufacturing capacity to support anticipated order sizes for dedicated AI facilities,” he said, “while end users continue to plan, design, and develop the operational readiness of these facilities.” “We are doing this,” he said.
He added: “We have a few more quarters left before this materializes in a meaningful way, which is why I characterize 2024, or at least the first half of this year, as the calm before the storm.”
Dell’Oro expects DCPI’s revenue growth to slow to a low single-digit rate in 2024, before accelerating to higher growth rates from 2025 to 2028.
Increased rack power density
As data center physical infrastructure (DCPI) vendors increase capacity to support dedicated AI facilities, the primary focus will be on rack power density.
Dell’Oro estimates that the average power density of today’s racks is approximately 15 kW per rack. AI workloads require 60 to 120 kW per rack to support nearby accelerated servers.
“While this will require innovation and product development on the power distribution side, a larger change is underway in thermal management: the transition from air cooling to liquid cooling,” Beran said. “With the advent of accelerated computing, liquid cooling will become a mainstream technology and will likely be present in most greenfield facilities.”
He added: “We have raised our forecast for liquid cooling to exceed $3 billion in 2028.”
Cloud colocation remains mainstream
Most of Dell’Oro’s growth during the forecast period is expected to come from cloud and colocation service providers. The research firm said it expects growth in the corporate customer segment to be moderate.
From a regional perspective, Asia Pacific (excluding China), North America, Europe, the Middle East and Africa (EMEA) are projected to grow at the fastest CAGR during the forecast period.
Growth in China, the Caribbean and Latin America (CALA) is expected to slow.
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