Edge Data Center Market Size & Share, by Component (Solution, Service); Organization (Large Enterprise, SMEs); Application (Retail, BFSI, Logistics & Transportation, Healthcare, Government, IT & Telecom) - Global Supply & Demand Analysis, Growth Forecasts, Statistics Report 2023-2035

  • Report ID: 4764
  • Published Date: Mar 29, 2023
  • Report Format: PDF, PPT

Global Market Size, Forecast, and Trend Highlights Over 2023-2035

Edge Data Center Market size is projected to cross USD 67 Billion by the end of 2035, growing at a CAGR of 26% during the forecast period, i.e., 2023-2035. In the year 2022, the industry size of edge data center was over USD 8 Billion.The growth of the market can be attributed to growing adoption of internet of things (IoT). Globally, about 8 billion Internet of Things (IoT) devices are expected to exist in 2020, almost tripling to more than 28 billion IoT devices in 2030. IoT is estimated to be benefited more by edge data center. It reduces communication latency between IoT devices and the main IT networks and also lead to quicker response times and higher operational effectiveness along with an increase in network bandwidth.

Moreover, the growing initiatives by government in enriching their nation digitally is also estimated to boost the growth of the edge data center market over the forecast period. For instance, RailTel, a central government PSU in India, was tasked with building "edge data centres" at railroad facilities in 102 different locations, primarily in tier-2 and tier-3 cities around the nation. RailTel was estimated to establish the "edge data centres" in collaboration with partners. Additionally, edge data center has been benefiting different industries including automobile, telemedicine, and telecommunication. Further, growing adoption of consumer electronics such as wearable, and smartwatches is also expected to boost the demand for edge data center. Hence, the construction of edge data center is also being conducted on large scale.


Edge Data Center Market
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Edge Data Center Sector: Growth Drivers and Challenges

Growth Drivers

  • Growth in Adoption of IoT - Over the past ten years, use of IoT has rapidly increased. About 14 billion devices were installed as of 2015, and by 2022, that number would almost triple to approximately 41 billion, globally. Edge computing and IoT work together to provide a more efficient way to gather and handle data. Edge computing handles data processing in real-time, which lowers network latency and congestion, increasing efficiency and improving the user experience. Moreover, IoT gadgets could act as cloud gateways, facilitating even more data gathering and processing. IoT and edge computing combine to provide a comprehensive approach to processing and managing data. Hence with the growing adoption of IoT, the demand for edge data center is also estimated to increase.
  • Rise in Establishing Network of Edge Data Centers - In 2022, the Government of Uttar Pradesh, in India inked an MoU with the Noida-based data center company VueNow Infotech Pvt Ltd to create a network of edge data center at about 749 locations throughout the state. It was projected that constructing the amenities would cost approximately USD 2 billion.
  • Surge in Demand for Robotic Surgeries - Robotic operations were carried out in the US in 753,000 cases in 2018, 883,000 cases in 2019, and 876,000 cases in 2020. Edge data centers could provide the extremely low latency and network stability that some medical equipment, such as those used in robotic surgery, needs.
  • Growth in Demand for Autonomous Vehicles - Globally, there were reportedly about 30 million autonomous vehicles in 2019, and this figure is expected to rise to approximately 53 million by 2024. Hence, with the growing demand for autonomous vehicles, the edge data center market is also estimated to grow. In autonomous vehicles, edge computing enables every bus, truck, and automobile on the road to function as a data warehouse. This makes it possible to provide mobility as a service, where data may be used by outside parties to provide services such as ride-sharing, route counselling for travelers, and information-gathering for traffic flow control by road authorities.
  • Upsurge in Adoption of Smartphones - In 2023, the total number of smartphone users in the globe would be 5 billion, representing approximately 85% of the global population. Using cell-tower edge data centers, telecom companies could connect wireless sensors and mobile devices to improve their closeness to end customers.

Challenges

  • Needs Heavy Initial Capital Investment - The need for significant capital expenditure in the research and development of edge-enabled software frameworks and hardware devices would certainly increase the initial cost of using edge data centers. Through taking into account the heterogeneity of hardware and platforms as well as the capacity with the arrival of edge, this investment is necessary to support a variety of key applications and workloads. Given the absence of digitalization and network infrastructure, the initial capital investment for leveraging requisite infrastructure and knowledge is considerably higher in emerging economies. While evaluating other IT investments inside the company, edge technology investment is frequently in competition.
  • Unable to Provide High Speed Connections in Rural Area
  • Issues Regarding Security in Green Storage Technologies

Edge Data Center Market: Key Insights

Base Year

2022

Forecast Year

2023-2035

CAGR

~26%

Base Year Market Size (2022)

~ USD 8 Billion

Forecast Year Market Size (2035)

~ USD 67 Billion

Regional Scope

  • North America (U.S., and Canada)
  • Latin America (Mexico, Argentina, Rest of Latin America)
  • Asia-Pacific (Japan, China, India, Indonesia, Malaysia, Australia, Rest of Asia-Pacific)
  • Europe (U.K., Germany, France, Italy, Spain, Russia, NORDIC, Rest of Europe)
  • Middle East and Africa (Israel, GCC North Africa, South Africa, Rest of the Middle East and Africa)
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Edge Data Center Segmentation

Organization (Large Enterprise, SMEs)

The global edge data center market is segmented and analyzed for demand and supply by organization into large enterprise, and SMEs. Out of which, the SMEs segment is anticipated to garner the highest revenue by the end of 2035. The growth of the segment can be attributed to surge in number of SMEs company. In 2021, there were projected to be about 330 million SMEs globally, a small increase from the approximately 325 million expected in 2019. Moreover, the adoption of edge computing is high among SMEs. The speed of edge computing is one of its appeals to SMEs. Edge computing reduces latency by eliminating the need to transport data to be analyzed elsewhere, such as a centralized cloud. This gives SMEs a fighting chance against larger organizations who have access to much more powerful computing resources. Additionally, SMEs are constantly concerned about cybersecurity. With edge computing, businesses may choose which data is to be sent to centralized processing units and which is kept on-site at local sources, maintaining control over their data. This protects both sensitive personal information and business-related data. Therefore, the market for edge data center is estimated to boost.

Application (Retail, BFSI, Logistics & Transportation, Healthcare, Government, IT & Telecom)

The global edge data center market is also segmented and analyzed for demand and supply by application into retail, BFSI, logistics & transportation, healthcare, government, and IT & telecom. Amongst which, the IT & telecom segment is expected to have a significant growth over the forecast period, backed by growing amount of data generated by industries, along with consumers. Edge computing embeds processing and storage capabilities closer to users, moving them out of centralized data centers. This paradigm offers telecoms strong chances to get into the application and platform area and expand their position beyond network and connectivity services. Moreover, edge application implementation lowers the amount of data that needs to be exchanged, the traffic that results from those transfers, and the distance the data needs to travel. The time between the point of data collection and the actual processing is drastically cut down by this innovative data processing technique.

Our in-depth analysis of the global market includes the following segments:

     By Component

  • Solution
  • Service

     By Organization

  • Large Enterprise
  • SMEs

 

     By Application

  • Retail
  • BFSI
  • Logistics & Telecommunication
  • Healthcare
  • Government
  • IT & Telecom

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Edge Data Center Industry - Regional Synopsis

North American Market Forecast

The edge data center market share in North America is projected to have the highest growth by the end of 2035, backed by growth in data traffic, along with surge in government initiatives in order to develop data centers. By 2027, it is anticipated that North America's monthly data traffic would reach about 18 exabytes (EB). The average monthly data traffic in 2021 was close to approximately 4 EB. Moreover, in order to speed up applications such as streaming video, factory automation, and telemedicine as well as enable new technologies such as autonomous cars and augmented and virtual reality (AR/VR), businesses, telecommunications companies, and cloud service providers is anticipated to increasingly invest in edge data centers in the coming years in this region. Also, the demand for low-latency connectivity among consumers in North America region is arguably expanding at the quickest rate in eSports and video games. Hence, even this factor is estimated to boost the growth of the market in this region.

APAC Market Statistics

The Asia Pacific edge data center market is estimated to be the second largest, to hold the highest market share over the forecast period. The growth of the market in this region can be attributed to growth in investment in IT sector and presence of prominent key players in this sector. Moreover, the increased use of digital services is changing how data centers are set up. When the distance from the data center increases, providing digital services to customers takes longer. Through locating data centers near the application's core, as opposed to keeping data in a centralized warehouse, full control over data processing and storage at the network's edge is possible. Furthermore, one of the major factors propelling the expansion of the edge data center market in the region is the rise in mobile data traffic. Furthermore, both the quantity of mobile data traffic and the number of smartphones and IoT devices are increasing in the region. In light of this, there is an increasing need for edge data centers, which in turn, is predicted to boost the growth of the region in the market.

Europe Market Forecast

Additionally, the edge data center market in Europe is also estimated to have a significant growth over the forecast period. Demand for edge computing has surged as a result of the exponential explosion of data brought on by the digital transformation. Furthermore, the development of smaller data centers that are located closer to population centers has also been accelerated by the rise in edge computing in the region. Therefore, the need for edge computing is expected to increase dramatically in a smaller emerging market of Europe as it processes data and provides services closer to the end user.

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Edge Data Center Market Size
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Companies Dominating the Edge Data Center Landscape

top-features-companies
    • Cisco Systems Inc.
      • Company Overview
      • Business Strategy
      • Key Product Offerings
      • Financial Performance
      • Key Performance Indicators
      • Risk Analysis
      • Recent Development
      • Regional Presence
      • SWOT Analysis
    • Dell Inc.
    • Flexential Corporation
    • Rittal GmbH & Co. KG
    • Vapor IO, Inc.
    • Eaton
    • Fujitsu
    • Hewlett Packard Enterprise Development LP
    • Huawei Technologies Co., Ltd.
    • IBM Corporation

In-the-news

In The News

  • The world's top independent wireless telecommunications provider in Europe, Cellnex Telecom, has partnered with Vapor IO, Inc., the creators of the Kinetic Grid platform, the world's first Open Grid network for offering edge and grid services, to expand its network edge to Europe.

  • In order to facilitate deployments and increase value from data generated and processed outside of the conventional data centre and public cloud—from rugged and remote locations to retail stores and factory floors—Dell, Inc. announced edge innovations across its infrastructure and PC portfolio.

Author Credits:  Abhishek Verma, Hetal Singh


  • Report ID: 4764
  • Published Date: Mar 29, 2023
  • Report Format: PDF, PPT

Frequently Asked Questions (FAQ)

The major factors driving the growth of the market are growth in adoption of IoT, rise in establishing network of edge data centers, surge in demand for robotic surgeries, and others.

The market size of edge data center is anticipated to attain a CAGR of 26% over the forecast period, i.e., 2023-2035.

Needs heavy initial capital investment, unable to provide high speed connections in rural area, and issues regarding security in green storage technologies are estimated to be the growth hindering factors for the market expansion.

The market in the North American region is projected to hold the largest market share by the end of 2035 and provide more business opportunities in the future.

The major players in the market are Cisco Systems Inc., Dell Inc., Flexential Corporation, Rittal GmbH & Co. KG, and more.

The company profiles are selected based on the revenues generated from the product segment, the geographical presence of the company which determines the revenue generating capacity as well as the new products being launched into the market by the company.

The market is segmented by component, organization, application, and by region.

The SMEs segment is anticipated to garner the largest market size by the end of 2035 and display significant growth opportunities.
Edge Data Center Market Report Scope
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