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The Edge Computing Market size is estimated to grow by USD 9,928.42 million at a compound annual growth rate (CAGR) of 24.74% between 2022 and 2027. The growth of the market depends on several factors, including the rising demand for decentralized computing, growing limitations of front-end devices, and optimizing network traffic for sustainable energy usage.
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The rising demand for decentralized computing to reduce latency in decision-making is notably driving the market growth, although factors such as competition from low-cost centralized and general-purpose computing infrastructure may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The rising demand for decentralized computing to reduce latency in decision-making is notably driving the market growth. The need for low latency in computing or decision-making tasks is increasing the demand for decentralized solutions. Edge nodes are usually placed a single hop away from the device node, which can save considerable time in reducing the roundabout time between the device and the edge node.
Many companies have started to provide solutions that can operate independently, without the need for full-time internet access. This allows users to reduce decision-making time in critical applications. For example, Amazon AWS Greengrass solution allows the user to run the computation, data caching, synchronization, and machine learning analytics operations for all locally connected devices without the need for internet connectivity. This type of computing environment also leads to the removal of a single point of failure or choke point for internet traffic. These factors are driving the growth of the market trends.
The deployment of Industry 4.0 infrastructure is a key trend influencing the market growth. Industry 4.0 refers to the use of connected automation systems and technologies, such as cyber-physical systems, IoT devices, cloud computing, and cognitive computing, which can enable large-scale automation in factories. The adoption of these technologies is expected to influence the demand.
Industry 4.0-based manufacturing operations and facilities require several IoT sensors, actuators, and communication tools, which constantly generate data. Edge computing plays an important role in the analysis and implementation of this data in the immediate manufacturing environment in real-time. Hence, the demand is expected to grow with the adoption of Industry 4.0 practices. These factors will support the market growth and trends during the forecast period.
Competition from low-cost centralized and general-purpose computing infrastructure may impede market growth. Centralized computing infrastructure includes cloud data centers, supercomputing facilities, and centralized data centers used by organizations to support their global operations. These facilities can be transformed to provide computing or processing capabilities as a service to anywhere in the world virtually.
Many public/private cloud server operators offer low-cost computing and storage services on a pay-as-you-go basis, which poses a threat to the market. Moreover, setting up infrastructure may require additional capital spending, network infrastructure, and skilled labor for maintenance and operation. Furthermore, some companies provide software-based solutions. These factors will impede the growth of the market during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market forecasting report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Amazon - The company offers mobile edge computing services through Google Distributed Cloud Edge.
The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market share growth by the industrial manufacturing segment will be significant during the forecast period. Industrial applications mainly focus on the automation of industrial manufacturing and process environments, which make substantial use of industrial IoT devices, automation hardware, and connected sensors and actuators.
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The industrial manufacturing segment showed a gradual increase in the market share of USD 924.93 million in 2017 and continued to grow by 2021. Some of the end-users in the industrial manufacturing segment are focusing on creating agreements with the companies operating in the market in focus to incorporate in their operations. For instance, in February 2021, Ford and Google announced a six-year strategic partnership on cloud services and the Android operating system. Therefore, such strategic alliances between companies and end-users can influence the growth of the market in focus during the forecast period.
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North America is estimated to account for 42% of the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The market in North America is expected to witness considerable growth owing to the growing emphasis on improving efficiency in IT infrastructure within commercial and industrial environments and the increasing adoption of big data analytics and IoT by end-users. The US and Canada are two of the key markets in North America. Enterprise customers in the US and Canada are keen on switching with many companies giving priority to switching from core-to-network edge systems in the next few years. Some of the companies operating in the region are focusing on launching new platforms. For instance, in May 2020, IBM and Red Hat launched new solutions that would help enterprises and telecommunication companies to speed up their transition to the 5G edge computing era. These factors will drive the growth of the regional market during the forecast period.
The market is witnessing significant growth, revolutionizing IT infrastructures and networking architectures. It offers businesses enhanced traffic distribution, service management, and software development capabilities, with hardware solutions optimizing deployment models. From AI-driven innovations to 5G integration, diverse industries are leveraging edge computing for operational agility and enhanced performance. M&A activities and technological advancements drive market expansion, emphasizing regulatory scrutiny and compliance standards.
Data privacy and security remain paramount, shaping the regulatory framework. Edge computing's strategic importance extends across end-user industries like healthcare, where digital technologies improve patient record management and enable remote care interventions. In industrial settings, smart factories harness AI for efficient operations. Energy and healthcare sectors particularly benefit, promoting environmental sustainability and enhancing patient care through IoT applications and telemedicine programs.
The market growth and forecasting report covers market growth by revenue at global, regional, and country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Edge Computing Market Scope |
|
Report Coverage |
Details |
Page number |
185 |
Base year |
2022 |
Historic period |
2017-2021 |
Edge Computing Market Forecast Period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 24.74% |
Market growth 2023-2027 |
USD 9,928.42 million |
Market structure |
Fragmented |
YoY growth 2022-2023 (%) |
22.67 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 42% |
Key countries |
US, China, Japan, Germany, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Alphabet Inc., Amazon.com Inc., Arrow Electronics Inc., Capgemini Service SAS, ClearBlade Inc., Dell Technologies Inc., EdgeConneX Inc., General Electric Co., Hewlett Packard Enterprise Co., Huawei Technologies Co. Ltd., Intel Corp., Nokia Corp., NVIDIA Corp., Renesas Electronics Corp., Schneider Electric SE, Telefonaktiebolaget LM Ericsson, Aarna Networks Inc., Cisco Systems Inc., International Business Machines Corp., and Microsoft Corp. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our market growth analysis report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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