Customers are overwhelmed by having to manage and control electrical systems in addition to managing networks. Issues such as heat, battery capacity and UPS uptime require constant supervision, and the transition to server consolidation and high-density data centers further aggravates this situation due to increased heat and power density.
New analysis from Frost & Sullivan, (power.frost.com) North American UPS Services Markets, finds the market earned revenues of $876.3 million in 2007 and estimates to reach $1.29 billion in 2014.
"Revenues for UPS services are primarily driven by the number of installed UPS systems, which is expected to grow during the forecast period," notes Frost & Sullivan Senior Consultant Farah Saeed. "The growth of the installed base has been positively influenced by data center expansions and build-outs."
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Revamped service offerings also increase the attractiveness of outsourced UPS services. A number of companies focus on addressing the entire physical infrastructure of data centers. Physical infrastructure consists of UPS, power distribution units (PDU), chillers, air handlers, pumps and other devices. As a direct result, companies have introduced, launched and marketed service programs that provide holistic solutions to address predictive faults, emergency and preventative maintenance issues.
In an increasingly competitive market, however, vendors are challenged by shrinking margins, rising raw material costs, market mergers and product commoditization. Consequently, vendors bundle services, such as breakdown maintenance, with UPS shipments and use them as a bargaining tool. This, in return, reduces revenue for UPS services.
"Furthermore, there exists a oligopolistic competitive environment with the top four market participants controlling around 53.9 percent of the market, and the remaining market participants controlling less than 3 percent each," says Saeed.
Educating customers on the importance of maintaining uptime through acquired value-added services is important to gain revenue. Many UPS manufacturers resort to production of white papers on the difference between various UPS services and also collaborate with the media to educate end users about benefits of purchasing preventative maintenance contracts.
North American UPS Services Markets is part of the Power Supplies and Batteries Growth Partnership Service program, which also includes research in the following markets: North American Three-phase UPS market, World UPS Market, World Power Distribution Units (PDU) Market, World Server Rack and Rack Options Market, and World Flywheel UPS Market, among others. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. Interviews with the press are available.
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North American UPS Services Markets