There is a silver lining for UPS suppliers in a stagnating European datacentre market hit by declining telecom-related activities and the bursting of the internet bubble. In response to the changed market situation, strongly related industries like uninterruptible power supplies (UPS) will have to adopt new strategies to succeed.
From late 2000, the UPS market began to feel the brunt of the dramatic slowdown. According to a new strategy study by Frost & Sullivan*, a reversal of this trend is expected only in 2003 with the recovery of the datacentre constituency. Thereafter, demand is projected to increase up to 2005 until it tapers off on maturation of the European datacentre market.
In the near future, beleaguered datacentre operators are looking to cut costs by adding UPS systems incrementally. Orders for single UPS systems that do not cover the entire demand will, in turn, require UPS suppliers to adopt modular solutions.
The study states that manufacturers need to be able to offer modular solutions that allow for easy upgrading. Such systems will contribute to making UPS investments by datacentre operators more progressive, based on their investments and their expected expansion.
UPS suppliers will have to move beyond the large output ranges that datacentres use, and provide for customer segments that use systems with smaller output ranges. Secondly, survival will also depend on UPS suppliers’ willingness to move beyond excessive reliance on one market segment, particularly the dotcom market with its sharp swings. F & S also recommend the forming of strategic partnerships among supplier companies and architect-engineers.
*Opportunities for UPS Suppliers in the European Datacentre Market. January 2002, price: ยค5000.