Data center switch

An edge computing forecast from IDC calls for worldwide spending on edge computing hardware, software and services this year to reach $208 billion, a 13.1% increase over 2022.

The firm says that the category will continue to grow at that rate through 2026 when worldwide spending will reach almost $317 billion. The United States will be the leader, with 40% of the worldwide total. It will be followed by western Europe and China.

Service provider spending will be the fastest growing of all 19 industries profiled, with a compound annual growth rate (CAGR) of 21.1%. All of the other 18 industries profiled also will enjoy double digit growth.

The firm suggests why the growth rate is high. It says that it has identified more than 400 use cases across industries and domains. The three atop a long list of investments for next year are content delivery networks, virtual network functions and multi-access edge computing (CDNs, VNFs and MEC). These all, according to the firm, are “foundational to service providers’ edge services offerings.”

“Edge computing has gone mainstream,” Dave McCarthy, IDC’s research vice president, Cloud and Edge Infrastructure Services, said in a press release about the edge computing forecast. “The ability to distribute applications and data to field locations is a key element of most digital transformation initiatives. As vendors extend existing feature sets and create new edge-specific offerings, customers are accelerating their adoption plans.”

IDC says that the most spending will be on professional and provisioned services. Almost half of this will be on connectivity services. That subcategory will be followed by software-as-a-service and support and deployment services. Hardware spending will focus on edge gateways, servers, and network equipment. Software will grow by the smallest amount.

In October 2021, IDC said that MEC revenues would grow from $3.5 billion in 2020 to $16.7 billion in 2025 and have a CAGR of 37%.

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