Latin American data center infrastructure market to surge beyond $1 billion mark in 2013

USA: The Latin America market for data center infrastructure equipment is set to expand by 9 percent and exceed $1 billion for the first time ever in 2013, as the region engages in aggressive digitalization to become more competitive globally.

Sales of data center infrastructure equipment in Latin America are forecast to climb to $1.01 billion in 2013, up from $926.6 million in 2012, according to the 2013 Latin American Market for Data Center Infrastructure Report from IMS Research. Revenue will continue to rise at a steady pace at least through 2016, when the market will swell to $1.3 billion.

The major categories of data center infrastructure include uninterruptible power supplies (UPS), data center cooling, rack power-distribution units (PDU) and IT racks and enclosures.

“Digitalization is driving the construction of data centers capable of managing the increasing IT workload that Latin American businesses need to compete in the global economy,” said Andres Gallardo, analyst at IHS.

“Technological advancements are causing servers to operate with higher densities, increasing the need for infrastructure equipment that can allow data centers to operate efficiently and securely. Because of this, the Latin American data center market are evolving into a sophisticated business and embracing security practices seen in developed economies, such as the United States.”

The fastest-growing product segment in the Latin American data center infrastructure equipment market will be rack PDUs, expected to enjoy a compound annual growth rate (CAGR) of nearly 20 percent from 2011 to 2016. The next fastest-growing segment will be cooling equipment, expanding at a CAGR of 9.2 percent during the same period.

“The fast growth of rack PDU and cooling equipment sales reflects global and regional realities for the Latin American data center market,” Gallardo said. “First, the need to increase efficiency within a data center is a worldwide trend, and Latin America is no exception. Second, poorly equipped data centers and server rooms in Latin America historically used PDUs and cooling equipment that were not specifically designed for data centers. This means that these products are the first ones to be replaced when updating the data center.”

The largest countries for data center infrastructure gear sales in Latin America are Brazil and Mexico. Together they accounted for 61 percent of the region’s market revenue in 2011.

However, the fastest-growing regions in terms of revenue are the Central America and Caribbean area, as well as Colombia.