4 Cloud Computing Trends Signaling the Growth of the Edge

Imagine an autonomous car needing to turn left or right at a busy intersection. What powers this car – as much as its engine – is a two-way high-velocity data exchange; a “conversation” between the car's on-board computer and the network it connects to. Any turn the vehicle makes is a dynamic decision that needs to be made quickly, based on shifting traffic patterns and road closures.

High-velocity data exchanges like this happen in the billions of IoT devices proliferating around the globe. And these networked IoT devices won’t just send data – they'll also need to receive instructions for adapting to changing contexts. These high-velocity, two-way conversations are the next generation of computing. 

We’re shifting from a one-way consumption model of data distribution to a more “conversational” model. But how do we get from here to there?

Edge computing. 

Why edge computing? Why now?

The need to geographically distribute network infrastructure becomes even clearer during a time of social distancing: a more geographically distributed workforce requires a more geographically distributed network infrastructure to support it. Proximity to what you need matters. 

Edge computing is growing today because it supports the evolving need for two-way, faster data exchanges. There are 5 billion edge devices in use today, with a projected 150 billion on the market by 2025. By 2030, the capital expenditure (CAPEX) on edge is projected to reach $700 billion. As more demand for faster data distribution and reduced latency become obvious, so does the value of the edge.

Indicators of growth in the edge

Intricately data has uncovered four clear signals that the edge will increasingly facilitate the future of computing, a future marked by more devices, more need for speed in data distribution, and more continuous two-way “conversations” rather than one-way data consumption.

1. Increasing Points of Presence (PoPs)

Points of presence, according to the Network Encyclopedia, “consist of the high-speed telecommunications equipment and technologies that enable users to connect to the Internet via their ISP. The PoP might include call aggregators, modem banks, routers, and high-speed Asynchronous Transfer Mode (ATM) switches.” 

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The growing number of PoPs represents a leading indicator that companies have begun decentralizing their cloud offerings and are increasingly moving infrastructure closer to users, for all the reasons we’ve described above: more access, a need for speed, and reduced latency.

2. Content delivery growth is evident across all sizes of business

Content Delivery Networks (CDNs) are geographically distributed networks of servers and their data centers that push out massive amounts of data to users rapidly by – you guessed it – being closer in proximity to users and their devices.

According to Intricately data, YoY CDN adoption grew steadily from February of 2020 to February of 2021. Adoption grew 27% for startups, 5% for small businesses, 4% for middle market businesses and 2% for enterprises.

3. Content delivery growth is global

The regional distribution of CDN buyers indicates another important trend signaling the global move towards Edge computing. While about 750,000 CDN buyers are located in North America, a far larger number (1.25 million) are outside of North America, with EMEA having 668,000 buyers, Asia-Pacific having 464,000 and Latin America with 118,000.

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The number of internet users is growing much faster globally than within North America: between 2010 and 2020, according to data from Statista, internet users tripled in Asia (from 825 million people to 2.5 billion) and increased fivefold in Africa (from 111 million people to 566 million).

4. Hybrid cloud hosting is outpacing data centers

A hybrid cloud is a computing infrastructure that combines an on-premises data center (also called a private cloud) with a public cloud, allowing data and applications to be shared between them. Hybridization aligns closely to company size, according to Intricately research. 

In terms of the percentage of applications hosted by environment type, hybrid cloud hosts 8% of apps for small businesses, 22% for middle market businesses (versus 17% for data centers), and 31% for enterprises (versus 16% for data centers). The rise of hybridization in mid-market and enterprise companies means that even the largest, most established organizations are moving closer to the edge.

Want to learn more about macro trends currently moving computing infrastructure towards the Edge? Download our Intricately State of the Edge Computing Market Report today.

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