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.
Growth Drivers
Challenges
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Base Year |
2022 |
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Forecast Year |
2023-2035 |
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CAGR |
~26% |
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Base Year Market Size (2022) |
~ USD 8 Billion |
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Forecast Year Market Size (2035) |
~ USD 67 Billion |
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Regional Scope |
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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:
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By Component |
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By Organization |
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By Application |
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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.
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
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