Spending on Racks Expected to Grow

Spending on server racks hit $2.42 billion in 2006, and is expected to grow in coming years.

Spending on server racks hit $2.42 billion in 2006, growing 12.3 percent from a year earlier, and is expected to increase further over the next several years as the data center industry continues its expansion.

"The implementation of network and infrastructure plans provide a strong foothold for all IT and telecom businesses and related industries, such as rack and rack options manufacturers, to grow," notes Frost & Sullivan research analyst Eduardo LoboGuerrero. "Although rack mount equipment has become denser, faster and smaller in form factor, an increasing amount of racks are likely needed to accommodate new equipment."

Product development and positioning will be an issue, the analyst added. "Consumer awareness plays a crucial role in capturing market share, as racks have been traditionally viewed as commodities and today's racks integrate all major components of a modern datacenter," LoboGuerro said. The report also notes that some vendors will continue to " target the production of low-priced racks, despite increase in raw material prices over the past few years."