Innovations in chip technology, rise in adoption of cloud computing, and favorable government regulations regarding localization of data centers facilitate the growth in the market. However, very high costs of operation restrain market growth. On the other hand, the increase in the number of smart computing devices is expected to create numerous opportunities in the industry.
Factors such as advancement in cloud computing and chip technology and growing government regulations regarding localizations of data centers are acting as drivers for the growth of the market. Moreover, an increase in smart computing devices offers lucrative growth opportunities for the market. As per Allied Market Research’s report on data center chip market, the market is anticipated to accrue a sum of $15,641.1 million by 2025, thereby growing at a CAGR of 9.4% during the forecast period, 2018 - 2025.
Based on regions, North America contributed to nearly two-fifths of the total share in terms of revenue in 2017 and will maintain its dominance by 2025. This is due to the rise in technological advancements and investments in research and development activities for data centers. On the other hand, LAMEA is expected to grow at the highest CAGR of 12.1% from during the forecast period, 2018–2025. This is due to an increase in demand from emerging economies such as Brazil and Chile and developed economies including South Africa and UAE. The research also discusses Asia-Pacific and Europe.
Based on the chip type, the GPU segment held the major market share, accounting for nearly one-third of the total share in 2017. This segment is estimated to continue its dominance throughout the forecast period. This is due to the increase in parallel processing capabilities along with rising in applications such as artificial intelligence (AI) for carrying out large scale data computations. On the other hand, the FPGA segment would register the highest CAGR of 11.2% from 2018 to 2025, owing to a rise in adoption across various verticals for its excellent reprogramming functionality. The report also discusses chip types such as CPU, ASIC, and others.
The growing demand for data center chips is pushing manufacturers to introduce new and innovative products in the market. Companies in the space are also focusing on strategies such as acquisitions and others to increase their market share and expand their market reach. For instance, in January ‘19, Huawei Technologies, a telecommunication equipment company, launched a new data center chipset aimed at enhancing performance and reducing power consumption. In February ’19, Arm Ltd. introduced two seven-nanometer Neoverse chips designed for data centers and 5G networks. Nvidia recently announced its plans to acquire Mellanox Technologies for data center chips for a sum of $6.8 billion.
Explore More@ https://www.alliedmarketresearch.com/data-center-chip-market