New research found Q3 2023 was the fifth consecutive quarter of double-digit year-over-year growth for the data center physical infrastructure market. Analyst firm Dell'Oro Group expects the market will continue to grow to historic levels in 2024, driven by the acceleration of artificial intelligence (AI) deployments.

The thermal management and power distribution segments experienced the most growth in Q3, driven by complications from Nvidia's expensive and supply-constrained H100 GPU that left IT teams limited resources to plan, design and deploy appropriate power and heat management systems.

“Given the sudden emergence of generative AI and the desire to rapidly scale AI [artificial intelligence] workloads, many end users immediately sought out new IT infrastructure, namely Nvidia’s H100/A100/DGX Servers,” Research Director Lucas Beran told SDxCentral. But based on dynamic factors like “who you got [those servers] from, when you got them, how many and at what cost, ... lead times grew to eight to 12 months and costs rapidly grew,” Beran said.

As a result, IT teams deployed other resources in an attempt to snag the necessary IT infrastructure as quickly and as affordable as possible, leaving little room for proper heat and energy management infrastructure deployment. “Due to the effort required here, many end users are only able to address the power and thermal management infrastructure requirements after or close to receiving those initial GPU shipments,” Beran said. “DGX servers have have elevated power and thermal management requirements, so it’s not necessarily as simple as ordering more of what you are already using.”

To address the novel power management requirements of AI infrastructure, many users are turning to customized or partly customized products with capacity to support higher levels of power distribution compared to what's available over the counter.

And to cool down these high-performance servers, IT teams are leveraging supplemental high-density air and air-assisted liquid cooling, which makes it possible to deploy this infrastructure in facilities designed to be air-cooled. Over the longer term, Beran expects to see more facilities designed to deploy liquid cooling technologies at scale.

The data center physical infrastructure market leaders are Vertiv with a 17% market share, Schneider Electric also at 17% and Eaton at No. 3 with a 9% market share, according to the Dell'Oro report.

Vertiv outpaced the market's overall growth in Q3 with two percentage points of growth. The company's presence in the North American market and in fast growing segments like thermal management and power distribution have fueled its growth. “They are now challenging Schneider Electric for the No. 1 worldwide data center physical infrastructure market share leadership position,” Beran said.