Philippines Data Center Cooling Market

Philippines Data Center Cooling Market Analysis

The Philippines Data Center Cooling Market size is estimated at USD 80.36 million in 2025, and is expected to reach USD 220.27 million by 2031, at a CAGR of 18.3% during the forecast period (2025-2031).

• The increasing demand for cloud computing among SMEs, government regulations for local data security, and growing investment by domestic players are some of the major factors driving the demand for data centers in the Philippines.
• The IT load capacity of the Philippine data center cooling market is expected to reach above 950 MW by 2030. The country's construction of raised floor area is expected to increase above 5.3 million sq. ft by 2030.
• The country's total number of racks to be installed is expected to reach more than 260 thousand units by 2030. NCR (Metro Manila) is expected to house the maximum number of racks by 2030. The average annual temperature of the country is 27.1 °C, with relatively small seasonal variations of about 3 °C. Depending upon climatic conditions, DC cooling is processed in the DC facilities.
• There are close to 23 submarine cable systems connecting the Philippines, and many are under construction.

Philippines Data Center Cooling Market Trends

Liquid-based Cooling is the Fastest-growing Segment of the Market

• Liquid cooling takes advantage of the superior heat transfer properties of water or other liquids to support efficient and cost-effective cooling of high-density racks, up to 3,000 times more effective than air. Long proven in mainframe and gaming applications, liquid cooling is increasingly being used to protect rack servers in data centers across the region.
• Direct liquid cooling solutions consistently deliver impressive partial power usage effectiveness (PUE) ranging from 1.02 to 1.03, surpassing the efficiency of even the most efficient air cooling systems by a marginal single-digit percentage. However, it is essential to note that a significant portion of the energy efficiency improvement attributed to DLC is not reflected in the PUE metric. This is due to the fact that traditional servers incorporate fans that draw power from the rack, and their control mechanisms are factored into the IT power consumption portion of the PUE calculation. These fan power requirements are considered part of the data center's overall payload.
• Technological advances have made liquid cooling easier to maintain, scalable, and affordable, reducing data center liquid consumption by more than 15% in tropical climates and 80% in greener areas. The energy used for liquid cooling can be recycled to heat buildings and water, and advanced artificial refrigerants can effectively reduce the carbon footprint of air conditioners.
• Furthermore, the demand for online shopping has increased considerably post-pandemic. Cashless payments, product quality, and shopping at the convenience of the home have increased the demand proportionally for these online e-commerce platforms. The leading online e-commerce platforms are Shopee, Lazada, Zalora, and BeautyMNL. The Philippine e-commerce market is expected to increase in value from USD 17 billion to USD 24 billion by 2025. Thus, growing data consumption and the need for storage are expected to aid in the expansion of data center facilities in the country.

IT and Telecommunication is the Largest Segment of the Market

• The ICT industry includes both IT and telecommunications markets. IT investment is on the rise, and the demand for the ICT industry is expected to grow significantly over the next five years. According to the Department of International Trade, the sales of Philippine software services are expected to reach USD 95 million by 2025.
• The Philippine Development Plan (PDP) 2023-2028 highlights digital transformation as a key theme. During his second State of the Nation Address (SONA), President Marcos mandated all government agencies to digitize essential public services. Initiatives supporting this directive encompass the creation of additional common tower infrastructures to bolster connectivity, the digitalization of business registration processes at the local government level, and the consolidation of online government services into a unified platform via the eGov PH Super App.
• Cyberattacks are expected to increase over the next five years. Advances in IT operations protect the ICT industry from cyberattacks. As cloud-based platforms and enterprise software provide real-time data, they create greater value for businesses, especially by providing remote access. For example, Microsoft introduced new and enhanced security services under a new service category known as "Microsoft Enterprise Security Professionals."
• Given the increasing digital adoption, Alibaba Cloud Intelligence intends to invest more in the Philippines after opening a data center. Allen Guo, the country manager for the technology firm, said at a press conference in Makati that the company was considering expanding the capacity of its data center to accommodate the growing use of digital platforms. Around 88% of the companies in the Philippines use cloud-based solutions. The growing demand for analytics and software for business purposes by the public and private industries is expected to boost the growth of the segment.

Philippines Data Center Cooling Industry Overview

The Philippine data center cooling market is moderately competitive, having gained a significant competitive edge in recent years. Currently, a handful of major players, including Stulz GmbH, Schneider Electric SE, Vertiv Group Corp., Rittal GmbH & Co. KG, and Mitsubishi Electric Hydronics & IT Cooling Systems SpA, dominate the market in terms of market share. These industry giants, boasting significant market shares, are actively engaged in expanding their customer base throughout the region. Their growth strategies primarily hinge on strategic collaborative efforts aimed at enhancing market share and overall profitability. Moreover, companies such as Schneider Electric SE and Johnson Controls Inc. offer liquid and air-based cooling products.

Philippines Data Center Cooling Market Leaders

Philippines Data Center Cooling Market News

• October 2023: GRC, DCV Industries, and Dell Technologies collaborated to deliver high-efficiency, containerized data centers to the Middle East. This collaboration leverages GRC's patented single-phase immersion cooling systems, DCV's durable containerized data center enclosures, and Dell's high-density PowerEdge servers. These components are expected to form a comprehensive solution that notably slashes data center construction, upkeep, and energy expenses, especially in challenging environments.
• March 2023: Interactive, a leading managed service provider (MSP), unveiled its groundbreaking immersion data center cooling solution aimed at enhancing high-performance computing (HPC) capabilities for its valued clientele. Collaborating closely with digital infrastructure provider Vertiv, Interactive integrated cutting-edge Green Revolution Cooling tanks into its system. These tanks utilize a single-phase, non-conductive coolant renowned for its electrical component safety, boasting an impressive heat transfer capacity that surpasses that of air by a staggering 1,200 times.