IDC has predicted a bright future for the managed edge computing services market as multiple drivers compel businesses to rethink their computing architectures.
The market research company forecasts worldwide revenues of $445.3 million for the managed edge services market this year, up 43.5% compared to 2020. This positive trend will continue until at least 2025, with a compound annual growth rate of 55.1% during that period.
Managed edge services are low-latency services that process data near the edge of a network, closer to where it is consumed and produced. Services in this emerging market range from content distribution through to edge application hosting and real-time data analytics.
IDC has identified three types of managed edge services environments. On-premises or private deployments located at the customer’s facilities, such as production plants or health care facilities, will be the fastest-growing use case with a five-year CAGR of 74.5%. An example might be augmented reality services or industrial automation.
Service provider deployments in a public cloud service or telco’s premises will enjoy the second-fastest growth. IDC added that this use case will involve fixed and mobile deployments and would be significant for sector-specific applications. It expects a CAGR of 59.2%, making it the largest market segment by next year.
Finally, IDC singled out content distribution network (CDN) services as a specific use case. CDNs will continue to refine their services with new edge technologies. IDC expects more personalized and interactive media experiences from the CDN managed edge services segment, enjoying a 41.9% CAGR over five years.
A key driver for the deployment of managed edge services is the need for process efficiencies. Analysts also pointed to new consumer applications, such as augmented and virtual reality.
Data sovereignty and security measures will also be big drivers as companies strive to maintain regulatory compliance while pursuing better customer experiences.
5G will also play a big part in managed edge services, the company said. Cloud service providers will partner with 5G infrastructure companies — typically telcos. Data center operators will also be eager to participate, as will network equipment vendors and software companies.