Edge Data Center Market Size By Component (Solution [Cooling, Power {UPS}, IT Racks & Enclosures, Networking Equipment, DCIM] Service [Installation & Integration, Managed, Consulting]), By Data Center Size (Micro Data Centers, Hyperscale/Enterprise Data Center), By Application (BFSI, Colocation, Energy, Government, Healthcare, Manufacturing, IT & Telecom), Industry Analysis Report, Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2020 – 2026

Published Date: Sep 2020  |  Report ID: GMI2421  |  Authors: Preeti Wadhwani, Saloni Gankar

Report Format: PDF   |   Pages: 375   |   Base Year: 2019




Summary Table of Contents Industry Coverage Methodology

Industry Trends

Edge Data Center Market size exceeded USD 5.5 billion in 2019 and is poised to grow at a CAGR of 23% between 2020 and 2026. The rise in demand for high computational power is encouraging service providers to host data centers at edge locations for low-latency connectivity, providing several growth opportunities to the market.
 


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The growing usage of internet services followed by rise in the number of connected devices has shifted the trend toward bandwidth-intensive applications. Increasing adoption of digital services is changing the way data centers are being deployed. As the distance from the data center increases, it takes more time to deliver digital services to customers. Establishing data centers closer to the point of application offers a complete control over data processing and storage at the edge of a network compared to establishing it in a centralized warehouse. The demand for reduced network traffic, real-time data analysis, low operating costs, and improved application performance will boost edge data center market growth.
 

There is a growing adoption of colocation services from SMEs to avoid large upfront costs in constructing and operating data centers. Managing IT infrastructure is a challenging and time-consuming process for SMEs. Colocation has been of growing interest to businesses due to fast deployment capacity and the providers’ core expertise in edge data center operations. Players in the colocation industry are focusing on offering robust solutions for managing the massive data generated in several application industries, boosting the edge data center market revenue.
 

The ongoing coronavirus (COVID-19) pandemic has negatively affected the global economic conditions and will pose a significant challenge for the edge data center market demand. Lockdowns imposed by several government administrations to ensure social distancing and stop the spread of the virus resulted in the temporary closure of industries in several countries. The temporary shutdown of factories coupled with the restrictions imposed on travel have hampered the market growth in the first half of 2020. However, with relaxations in lockdown rules and resumption of industrial activities in the second half of 2020, the market will regain traction.
 

Edge Data Center Market Report Coverage
Report Coverage Details
Base Year: 2019 Market Size in 2019: 5.5 Billion (USD)
Historical Data for: 2016 to 2019 Forecast Period: 2020 to 2026
Forecast Period 2020 to 2026 CAGR: 23% 2026 Value Projection: 20 Billion (USD)
Pages: 375 Tables, Charts & Figures: 451
Geographies covered (20): U.S., Canada, Mexico, UK, Germany, France, Spain, Poland, Benelux, China, India, Japan, Australia, Singapore, Brazil, Argentina, Chile, Colombia, South Africa, GCC
Segments covered: Component, Data Center Size, Application and Region
Companies covered (23): 365 Operating Company LLC, Dell Technologies, Inc., Eaton Corporation, EdgeConneX, Inc., EdgeMicro, EdgePresence, Flexential Corporation, Fujitsu Ltd., Hewlett Packard Enterprise (HPE) Company, Huawei Technologies Co., Ltd., IBM Corporation, Netrality Properties LP, NVIDIA Corporation, Panduit Corporation, Rittal Gmbh & Co. KG, Schneider Electric SE, Servtech Inc., Smart Edge Data Centres Limited, Systel, Inc., Vapor IO, Inc., Vertiv Group Co., vXchnge Holdings LLC, Zella DC
Growth Drivers:
  • Increasing usage of online services in North America
  • Growing demand for edge computing in autonomous vehicles in Europe
  • Flourishing telecommunication sector in Asia Pacific
  • Growing penetration of colocation data centers in South America
  • Rising consumer demand for high bandwidth services in the MEA
Pitfalls & Challenges:
  • High initial investments
  • Security issues in green storage technologies

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Micro edge data centers will witness high demand from the Indian market owing to the ongoing industrialization

Rapid urbanization in India has led to the growth of industrialization. The industries are focusing on automating all processes by replacing human labor with machines, driving the demand for smaller data centers at network edge. Cloud and IT providers are expanding their presence in the Indian market by establishing edge micro data centers. In April 2019, Reichle & De-Massari (R&M) Holding AG launched micro data center for edge deployments in India. The data centers are supporting the development of compact, high-performance data center infrastructure on the edge of the cloud.
 

Demand for advanced infrastructure solutions to ensure optimal data center operations

The DCIM segment in the edge data center market will expand at 28% CAGR during the forecast timespan. Increase in the energy consumed by data centers has prompted several government authorities to stress on reducing energy consumption and maintain Power Usage Effectiveness (PUE). DCIM software allows operators to monitor, measure, and manage data center parameters, covering both IT equipment and supporting infrastructure such as cooling and power systems. It helps data center managers to achieve maximum energy efficiency and prevent equipment failure that leads to downtime.
 

DCIM enables automation and monitoring of the IT room and facility power, security, and environmental control. It ensures the efficient functioning of data centers and delivers user-configurable thresholds for alarms on devices including air conditioning, ventilation, and heat. Development and implementation software enable market players to make necessary changes, install new equipment for maximum efficiency, and track assets.
 

The rising awareness of energy efficiency is expected to encourage edge data center providers to implement DCIM solutions. The edge data center market leaders are focusing on offering robust infrastructure solutions to provide enhanced services to customers. For instance, Vertiv Group Co. provides Trellis DCIM platform to help companies in managing and monitoring data center infrastructure including assets, connections, and energy use.
 

Strong manufacturing industry in Europe supporting the adoption of digital technologies

Europe Edge Data Center Market

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Manufacturing applications in the Europe edge data center market held a revenue share of around 10% in 2019 and is predicted to register 20% growth through 2026. Europe has a strong manufacturing sector that implements advanced technologies such as IoT, 5G, robotics, and machine learning to boost productivity. Industry 4.0 initiative of Germany government under the Ministry for Economic Affairs and Energy (BMWI) and Ministry of Education and Research (BMBF) aims at driving digitization in the manufacturing sector.
 

With increasing adoption of connected devices among manufacturers, the demand for edge data centers for high performance IT & network infrastructure solutions will escalate, propelling the edge data center market size expansion. The strong automotive industry in the UK, Germany, and Italy markets with the presence of leading companies, such as BMW, AG, and Volkswagen, is driving the trend of autonomous vehicles that require fast processing of large amount of data in real-time. Edge data center providers are capitalizing on the growing automotive sector in the European market. The growing demand to handle the surging amounts of data from manufacturing as well as automotive sectors will propel the market demand for high performance edge data centers to reduce latency and bandwidth costs.
 

Growing use of social media resulting in the mounting digital data will drive the edge data center market demand in Asia Pacific

Asia Pacific Edge Data Center Market

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The Asia Pacific edge data center market size is expected to observe growth rate of 25% from 2020 to 2026. The growing popularity of OTT platforms, such as YouTube, Hulu, Netflix, and Amazon, in several countries in the region will surge the market demand for robust edge data centers for effective data management.
 

Several social media platforms have gained popularity in South Korea, particularly amongst the young generation of the country. People use social media platforms, such as Facebook and Instagram, to upload content online. The internet has reached more than 95% of the country. According to Linkinfluence, a social media intelligence company, South Korea had the third highest rate of active social media users globally as of January 2019. As stated by Cisco Systems Inc., social networking will account for 22% of traffic within data centers by 2021. High demand for fast data processing will fuel the market growth in the region.
 

Growing demand for edge data centers across several industry verticals will encourage market players to introduce pioneering solutions

Key companies operating in the edge data center market include Eaton Corporation, EdgeConnex Inc., Fujitsu Ltd., Hewlett Packard Enterprise Company, Huawei Technologies Co. Ltd., IBM Corporation, Panduit Corporation, Rittal GmbH & Co. Kg., Schneider Electric SE, and Vertiv Co.
 

The edge data center market players are focusing on research and development to incorporate the latest technologies in their offerings and introduce innovative solutions in the market. They are integrating advanced technologies into edge data centers to ensure efficient operation and maximum productivity.
 

For instance, in May 2020, Nvidia Corporation launched the EGX A100 and Jetson Xavier NX for its EGX edge AI platform. The EGX A 100 is for larger servers while the Jetson Xavier NX is for micro edge servers that deliver secure AI processing at the edge. With the Nvidia Edge AI platform, factories, stores, and hospitals can perform real-time processing of large amounts of data streaming from several edge sensors.
 

The edge data center market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue in USD from 2016 to 2026 for the following segments:

Market, By Component

  • Solution
    • Cooling
    • Power
      • UPS
    • IT racks & enclosures
    • Networking equipment
    • DCIM
  • Service
    • Installation & integration
    • Managed
    • Consulting

Market, By Data Center Size

  • Micro data centers
  • Hyperscale/enterprise data center
  • Others

Market, By Application

  • BFSI
  • Colocation
  • Energy
  • Government
  • Healthcare
  • Manufacturing
  • IT & Telecom
  • Others

The above information has been provided for the following regions and countries:

  • North America
    • U.S.
    • Canada
    • Mexico
  • Europe
    • UK
    • Germany
    • France
    • Spain
    • Poland
    • Benelux
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • Singapore
  • South America
    • Brazil
    • Argentina
    • Colombia
    • Chile
  • MEA
    • South Africa
    • GCC

 

Frequently Asked Questions (FAQ) :

The market for edge data centers will register nearly 23% CAGR during 2020-2026 owing to the increased number of connected devices worldwide and the demand for low-latency connectivity near points of application.
DCIM solutions will record around 28% CAGR up to 2026, with the need for monitoring, measuring, and managing edge data center parameters to ensure highest efficiencies and prevent equipment failure.
Europe industry share from manufacturing applications is expected to expand at 20% CAGR through 2026, owing to rapid deployment of technologies like robotics, IoT, 5G and machine learning.
The Asia Pacific market will to witness 25% growth through 2026 as the need for effective data management increases with the rise in users of social media and OTT platforms including Netflix, YouTube, Facebook and Amazon.

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Premium Report Details

  • Published Date: Sep 2020
  • Pages: 375
  • Tables: 416
  • Charts / Figures: 35
  • Companies covered: 23
  • Countries covered: 20

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