Originally published on Technavio:Rugged Servers Market Analysis by End-user, Type, and Geography - Forecast and Analysis 2023-2027
The rugged servers market is projected to grow by USD 751.25 million, with a Compound Annual Growth Rate (CAGR) of 5.51% expected between 2022 and 2027. This growth hinges on various factors, including increased adoption of cloud applications, expansion in spending within the oil and gas industry, and a global rise in military expenditure.

The report provides an in-depth analysis of drivers, trends, and challenges, along with historic market data from 2017 to 2021.
Rugged Servers Market Size

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Rugged Server Market Dynamics
The market's growth is notably driven by increased adoption of cloud applications, although factors such as high procurement costs may hinder growth. Our researchers conducted an extensive study using data from 2022 as the base year and estimated year 2023, presenting key drivers, trends, and challenges for the market.

Key Market Driver

Increased adoption of cloud applications significantly drives global market growth. Enterprises seek data storage centers in cold climatic zones to reduce power consumption of cooling units needed to maintain stable temperatures within the data center. Moreover, the global data center market has been influenced by the popularity of cloud storage. Several networking service companies, such as Facebook, Google, and Amazon, offer cloud storage services, disrupting the global data center market. Cloud computing, providing centralized computation through data centers, has led to increased data center numbers worldwide. Investments in data centers in cold regions positively impact the market. Additionally, increased focus on data centers by the military sector will have a positive market impact.

Major Market Trend

The emergence of containerized data centers will fuel global market growth. These portable data centers can increase capacity as required and be placed in any location. Equipped with standard components, modular containerized data centers allow easy integration with existing networks. These centers, consisting of servers, storage, and networking equipment, are transported in standard shipping containers. Top firms like IBM and CISCO have developed containerized data centers. The requirement for servers compatible with containerized data centers presents an opportunity for vendors in the global market.

Significant Market Challenge

High procurement costs pose a major challenge to global market growth. Rugged equipment, including servers, is nearly twice as expensive as commercial equipment. However, rugged equipment's total cost of ownership remains lower in the long run. While consumer-grade products may seem attractive due to lower initial acquisition costs, their total cost of ownership surpasses that of rugged equipment. Although rugged equipment's high procurement cost hinders its adoption across applications, it offers lower annualized total cost of ownership compared to non-rugged equipment, which impacts the market negatively.

Key Market Customer Landscape

Our analysis of the Global market's Life Cycle indicates a movement from the innovator’s stage to the laggard’s stage. The report illustrates the lifecycle, focusing on adoption rates in major countries including the US, Canada, China, Japan, India, and Germany. Key purchase criteria, adoption rates, lifecycles, and drivers of price sensitivity are included to aid companies in evaluating and developing growth strategies from 2022 to 2027.

Global Market Customer Landscape
Companies employ various strategies such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches to enhance their market presence.

core-systems.com - The company offers products like M114 designed for applications with a maximum of 14 in-depth requirements and tested for military use. Additionally, the company develops semiconductor ion implant outsourcing technology for designing and manufacturing industrial and military computing designs based on customer specifications.

The report also provides detailed analyses of the market's competitive landscape and information on 20 market players, including.
Rugged Servers Market Share by Geography

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North America is projected to contribute 32% by 2027. Technavio analysts explain regional trends and drivers shaping the market, with North America expected to dominate due to increased demand for data centers in the US and Canada. Rising demand for cloud-based solutions also drives market growth, with Technavio expecting North America to lead the global data center market during the forecast period due to numerous data center construction projects.

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High-performance computing and high-capacity data storage needs in demanding environments like military and aerospace drive market growth. Despite challenges such as travel bans and business shutdowns, the market grows due to increasing demand for electronics that can withstand extreme conditions. Rugged servers are essential for enhancing Intelligence, Surveillance, and Reconnaissance (ISR) performance by enabling real-time high-speed sensor data collection and hot-swappable data extraction. Adoption of rugged servers is evident in data center construction projects, ensuring continuous and reliable operations in critical applications.

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