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Edge computing refers to a distributed computing framework that brings computation and data storage closer to the locations where large volumes of data are being produced from interconnected devices. It facilitates real-time data processing and analysis to deliver actionable insights with low latency. With the proliferation of IoT devices across industries, the volume of data being generated has ballooned exponentially in recent years. Conventional cloud computing infrastructure struggles to deal with such large data loads and real-time analytics requirements. Edge computing addresses this issue by decentralizing storage and computing power away from centralized cloud data centers to the edge nodes located near IoT sensors and endpoint devices. This brings computation closer to the data sources, enabling instant analysis of large and diverse datasets without the need for back-and-forth communication with faraway cloud servers. The distributed edge node network can independently process, store and analyze data in a decentralized manner to gain valuable insights. With enterprises across industries realizing the potential of harnessing real-time insights from massive IoT data for optimizing processes, improving productivity and enabling new revenue streams, the edge computing market is experiencing tremendous growth.
The global Edge Computing Market is estimated to be valued at US$ 111.3 Bn in 2024 and is expected to exhibit a CAGR of 15.% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Cloud-to-edge computing is gaining popularity as hybrid models provide the advantages of both cloud and edge infrastructure. Large private edge networks operated by hyperscalers like Microsoft and Amazon are bridging the gap between centralized clouds and distributed IoT/endpoint devices. This hybrid approach facilitates real-time analytics on critical industrial data at the edge while tapping into scalable compute in the cloud. With rising adoption of 5G networks worldwide, network operators are deploying edge capabilities at telecom towers to tap new revenue opportunities from low latency applications. Edge micro-data centers housed in 5G base stations will allow operators to offer infrastructure as a service to enterprises requiring distributed edge computing facilities. Edge ecosystems involving hyperscalers, telecom operators and enterprises are expected to accelerate innovation in industrial and commercial applications of edge computing over the coming years.
Porter’s Analysis
Threat of new entrants: The threat of new entrants is moderate as the edge computing market requires high capital investment for infrastructure development. However, the emergence of open-source edge computing platforms is reducing the entry barriers.
Bargaining power of buyers: The bargaining power of buyers is high given the presence of many vendors offering edge computing solutions. Buyers can negotiate on better pricing and terms.
Bargaining power of suppliers: A few large technology companies dominate the supply of edge computing hardware and platforms. This gives them significant bargaining power over buyers.
Threat of new substitutes: Edge computing faces competition from traditional cloud and on-premises IT infrastructure. However, the unique advantages of edge computing related to low latency make it difficult to substitute.
Competitive rivalry: The edge computing market sees intense competition among major players. Vendors compete based on capabilities, technologies, services, and pricing to gain market share.
Key Takeaways
The global Edge Computing Market is expected to witness high growth over the forecast period driven by the rising adoption of IoT and deployment of 5G networks.
North America accounts for the largest share of the edge computing market currently due to early adoption among organizations across industries in the region. The Asia Pacific edge computing market is anticipated to grow at the fastest pace during the forecast period owing to the proliferation of cloud and IoT technologies across industries coupled with strong government support for digitalization in major countries.
Key players operating in the edge computing market are Microsoft Corporation, Google LLC, IBM Corporation, Huawei Technologies Co. Limited, and Cisco Systems Inc. Microsoft, Google and IBM hold a major share in the edge analytics and artificial intelligence platforms segment. Huawei and Cisco have built their presence in the edge infrastructure domain by offering edge gateways, modules, and edge servers. These players are focusing on partnerships and acquisitions to expand their product portfolio and customer base in high growth industry verticals.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
