Does the European market for data center power distribution products have untapped potential?

Data center power distribution in Europe accounts for a very small amount of the $440 million accumulated in 2011. The potential for a growing market exists, but a lack of visibility and investment remains a hurdle.

05/21/2012


With an estimated size of around $50 million in 2011, EMEA’s market for three-phase data center power distribution hardware was smaller even than that of Asia’s developing markets. A new study by IMS Research, recently acquired by IHS Inc., shows that the global data center power distribution market was worth $440 million in 2011; the Europe, the Middle East and Africa (EMEA) market accounted for only 11% of this, with most revenues coming from the Middle East. However, because EMEA’s markets for both data centers and uninterruptable power supplies (UPS) are of similar size to those in the Americas, it is possible that EMEA is merely an untapped potential waiting to become the next $100 million dollar market by 2016 for these types of specialty power distribution products.

The study considered product hardware for the three-phase power distribution market including transformer-based power distribution units (PDU), remote power panels (RPP), static transfer switches (STS), overhead busway, and branch circuit monitoring (BCM). With a high price tag, commanding upwards of $30,000 for just one unit, transformer-based PDUs make up 37% of hardware revenues. As most of EMEA, with the exception of the Middle East, uses 400/230 Vac distribution, the need for the step-down voltage transformation provided by PDUs is unnecessary; this eliminates the potential for upwards of $100 million in revenues from PDUs in EMEA.

“The lack of need for a step-down transformer is just one of the reasons for the difference in size between the American and EMEA markets,” says IMS Research market analyst Lori Lewis. “Instead of using expensive hardware such as PDUs and RPPs, the market has been satisfied by local panel builders using generic equipment to build low cost wall panels.”

Furthermore, limited visibility and product knowledge of the more relevant equipment, such as overhead busway, have delayed significant sales in EMEA. Overhead busway offers the benefits of bringing circuit breakers closer to the loads without consuming floor space while also allowing for much more flexible reconfigurations in the ever-changing data center environment. “Because this product was developed as an alternative to the transformer-based PDU, most manufacturers of overhead busways and their installed user base are in the US. Therefore, the market for overhead busway has yet to establish itself in EMEA,” explains Lewis. “Should more companies begin to showcase busway products in EMEA data centers, the more likely these products will catch on in the region.”

Universal Electric has been selling its Starline track busway product into European data centers through European resellers for a few years now. More recently, Power Distribution, Inc. signed an international licensing deal with UK-based Mardix to sell PDI’s overhead busway line in EMEA. Such expanded marketing is what is needed to bring three-phase power distribution products into EMEA data centers and create product awareness in equipment such as branch circuit monitoring and overhead busway. “We feel that there is a market for these products in EMEA, but until more suppliers begin exploring these opportunities for growth, it is likely to take longer than five years before EMEA hits the $100 million dollar mark.”



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