The global edge data center market size was valued at USD 8.27 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 17.9% from 2022 to 2030. Global demand for edge data centers is expected to increase as more industries are adopting emerging technologies such as the internet of things, big data, artificial intelligence, cloud, streaming services, and 5G. Most of the prominent players have moved to public and private clouds, co-location facilities, the edge cloud, and evolving data centers using virtualization and software-defined networks. The reasons for the shift toward edge data centers include smart agility, convenience, and cost-effectiveness. Edge data centers are relatively smaller than large cloud data centers and will need to be located near places where people congregate and move. It has decentralized facilities, equipped with power and cooling infrastructure that provides computing and storage in a location closer to where data is being generated and/or used. There are two types of edge data centers: metro and mobile. They are typically the size of a shipping container, are placed at the base of cell towers, and provide substantial support to IoT (Internet of Things) and the autonomous vehicle segment to increase processing capability and enhance customers’ experience. They are also helping mobile network operators (MNOs) to provide faster content services to mobile subscribers and prefabricated modular edge data centers, which are ideal for a variety of industries that need hyper-local computing and storage capacity. These technologies create high volumes of data in the network, generating new performance and computing demands in the data center, which is ultimately driving the demand for edge data center solutions and services. In addition, the demand for low operating costs, real-time data analysis, reduced network traffic, improved application performance, and business agility will accelerate the growth of the market.
The COVID-19 pandemic had a positive impact on the market. Increased corporate awareness regarding the benefits of edge computing services, increased pressure to provide more secure and robust IT environments, and the establishment of local data centers throughout the regions have all contributed to the data center industry growth. In addition, the growing popularity of OTT platforms and e-commerce is expected to drive demand for edge data centers in the projected period.
Health safety compliances and mandatory containment measures have put huge pressure on remote operations in several industries, such as automotive, manufacturing, retail, and logistics. For instance, numerous automotive companies, such as Fiat Chrysler, Ford, and GM, had shut down their centers and operations across Europe and North America. This has resulted in the demand for edge computing solutions to support remote monitoring across these industries.
The solution segment accounted for the largest revenue share of over 85.0% in 2021 and is expected to continue to dominate the market over the forecast period. The solution segment includes hardware and software solutions such as networking equipment, IT racks and enclosures, DCIM software, and data center analytics solutions. Factors such as the emergence of next-generation DCIM offerings, the rise in data center workloads during COVID-19, and the need to improve data center energy efficiency are driving the demand for edge data center solutions. In terms of component, the market is segmented into solutions and services.
The service segment is anticipated to witness the highest growth rate of 19.8% during the forecast period. The service segment is bifurcated into professional services and managed services. Edge data center professional services improve service delivery, simplify IT operations, and enable cloud initiatives. It includes services such as integration and implementation and consulting services.
The large facility segment held the largest revenue share of over 75.0% in 2021. Facilities with 12-49 racks or more and a power draw of 12 to 14 kW/rack or cabinet fall under the large facility segment. As they easily expand and support an organization's data center capabilities, these large facility data centers are perfect for businesses with several branch offices. They are also ideal for reducing space, deploying quickly, and offering ways to cut costs.
The small and medium facility segment is expected to register the highest growth rate of 18.7% during the forecast period. In the upcoming years, SMEs are anticipated to quickly adopt edge data center solutions as they are witnessing strong digitization and providing online services, both of which require data-intensive applications. Thus, demand for small and medium-edge data centers is expected to increase during the forecast period.
The IT and telecom segment held the largest revenue share of over 35.0% in 2021 and is expected to maintain its position over the forecast period. With the introduction of various technologies such as IoT, 5G, augmented and virtual reality, and AI/ML, the IT and telecom sector is growing to meet the needs of large data processing and low latency. Thus, to meet these demands, IT and telecom data centers are going through a transformation to handle low latency and high data volume needs, which is ultimately driving the demand for edge data centers. Based on the end-use industry, the global market is segmented into IT & telecom, BFSI, manufacturing & automotive, government, healthcare & life science, retail & E-commerce, gaming & entertainment, and others.
The manufacturing and automotive segment is expected to register the highest growth rate of 20.4% during the forecast period. Increasing adoption of technologies such as 5G and edge computing in the automotive sector as they can provide high bandwidth, low latency, and mobile applications in a reliable and secure way is the major factor behind the segment growth.
North America dominated the market with a share of over 30.0% in 2021 and is anticipated to retain its position over the forecast period. The high adoption of edge data center solutions and services in this region is the major factor behind the market growth. In addition, North America has prominent edge data center solutions and service providers, which makes North America a promising region for the market. The region is likely to witness significant growth owing to the growing commercialization and deployment of 5G networks in the region.
Asia Pacific is anticipated to expand at the highest CAGR of 18.7% during the forecast period. The market for edge data centers in this region is driven by the rise in investments in the IT sector, the growth of end-use industries, and the vast presence of edge computing companies such as Huawei Technologies Co., Ltd., and Fujitsu.
The market has a fragmented competitive landscape as it features various global and regional market players. Leading industry players are undertaking strategies such as product launches, collaborations, and partnerships to survive the highly competitive environment and expand their business footprints.
For instance, in June 2022, Cisco and Kyndryl announced a technology collaboration to aid enterprise customers to increase their transformation into data-driven businesses powered by Kyndryl-managed services and Cisco solutions. By utilizing cloud computing technologies that simplify difficult hybrid IT management with increased manageability, visibility, and flexibility, Cisco and Kyndryl will work together to assist businesses in transforming their operations. In addition, in October 2021, to support the acceleration of HPE's edge-to-cloud strategy, Hewlett Packard Enterprise announced strategies to extend its venture financing program, Hewlett Packard Pathfinder. Over the course of the upcoming year, Pathfinder aims to considerably increase the rate of its investments, beginning with new investments that address three important client challenges such as cloud, edge, and data. Some prominent players in the global edge data center market include:
Cisco Systems Inc.
Dell Inc.
Flexential Corporation
Rittal GmbH & Co. KG
Vapor IO, Inc.
Eaton
Fujitsu
Hewlett Packard Enterprise Development LP
Huawei Technologies Co., Ltd.
IBM
NVIDIA Corporation
Schneider Electric
Vertiv Group Corp.
CommScope
365 Data Centers
Report Attribute |
Details |
Market size value in 2022 |
USD 9.36 billion |
Revenue forecast in 2030 |
USD 34.91 billion |
Growth Rate |
CAGR of 17.9% from 2022 to 2030 |
Base year for estimation |
2021 |
Historical data |
2017 - 2020 |
Forecast period |
2022 - 2030 |
Quantitative units |
Revenue in USD million/billion and CAGR from 2022 to 2030 |
Report coverage |
Revenue forecast, company ranking, competitive landscape, growth factors, and trends |
Segments covered |
Component, facility size, end-use industry, region |
Regional scope |
North America; Europe; Asia Pacific; Latin America; MEA |
Country scope |
U.S.; Canada; U.K.; Germany; France; Italy; Rest of Europe; China; India; Japan; Australia; Rest of Asia Pacific; Brazil; Mexico; Rest of Latin America; UAE; Saudi Arabia; South Africa; Rest of Middle East And Africa |
Key companies profiled |
Cisco Systems Inc.; Dell Inc.; Eaton; Fujitsu; Hewlett Packard Enterprise Development LP; Huawei Technologies Co., Ltd.; IBM; NVIDIA Corporation; Schneider Electric; Vertiv Group Corp.; CommScope; 365 Data Centers |
Customization scope |
Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional, and segment scope. |
Pricing and purchase options |
Avail customized purchase options to meet your exact research needs. Explore purchase options |
This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global edge data center market report based on component, facility size, end-use industry, and region:
Component Outlook (Revenue, USD Million, 2017 - 2030)
Solution
Hardware
Software
Service
Professional
Managed
Facility Size Outlook (Revenue, USD Million, 2017 - 2030)
Small And Medium Facility
Large Facility
End-use Industry Outlook (Revenue, USD Million, 2017 - 2030)
IT And Telecom
BFSI
Healthcare And Lifesciences
Manufacturing & Automotive
Government
Gaming And Entertainment
Retail And E-Commerce
Others
Regional Outlook (Revenue, USD Million, 2017 - 2030)
North America
U.S.
Canada
Europe
U.K.
Germany
Italy
France
Rest of Europe
Asia Pacific
China
India
Japan
Australia
Rest of Asia Pacific
Latin America
Brazil
Mexico
Rest of Latin America
Middle East & Africa
UAE
Saudi Arabia
South Africa
Rest of MEA
b. The global edge data center market size was estimated at USD 8.27 billion in 2021 and is expected to reach USD 9.36 billion in 2022
b. The global edge data center market is expected to grow at a compound annual growth rate of 17.9% from 2022 to 2030 to reach USD 34.91 billion by 2030
b. North America dominated the edge data center market with a market share of 33.2% in 2021. This is attributed to the large presence of prominent industry players in the region
b. Some key players operating in the edge data center market include Cisco Systems Inc., Dell Inc., Eaton, Fujitsu, Hewlett Packard Enterprise Development LP, Huawei Technologies Co., Ltd., IBM, NVIDIA Corporation, Schneider Electric, Vertiv Group Corp., CommScope, 365 Data Centers
b. Key factors driving the edge data center market growth include surged spending on data center technology and increased adoption of edge computing solutions
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