According to our new research study on "Edge Computing Market Forecast to 2028 - COVID-19 Impact and Global Analysis - by Component, Organization Size, Application, Industry, and Geography," the edge computing market is projected to reach US$ 132.11 billion by 2028 from US$ 40.84 billion in 2022; the market size is estimated to grow at a CAGR of 21.6% from 2022 to 2028.
The concept of network slicing and composable networking is ushering in a new era of user-centric networks, thanks to the capabilities of 5G connectivity. This technology allows network service providers to intelligently route traffic to the optimal location, creating a demand for faster network speeds. However, with the advent of distributed cloud computing, providers can now move beyond traditional connectivity-service models. Communication Service Providers (CSPs) are seeking new revenue streams to spur growth in their businesses, and the emergence of 5G and edge computing is enabling them to do so. 5G technology can improve application response times, reduce latency, and enhance data collection and processing capabilities, allowing enterprises to optimize their operational systems and improve productivity and customer experiences. Additionally, the specialized and complex nature of edge computing applications can be supported by 5G network infrastructure, which enables seamless communication without delays. The introduction of 5G with an edge messaging system creates lightning-fast connectivity services and instantaneous communication experiences, contributing to the growing demand for edge computing.
Edge computing offers benefits such as enhanced speed, security, and privacy, along with reduced operational costs and latency. It eliminates the need to transfer data from endpoints to the cloud and back, which enhances reliability and resiliency in high-speed operations. Edge computing delivers ultra-high network performance, real-time analytics, integrated virtual probes, and deployment flexibility across various applications. Industrial edge computing supports the connection of assets used in manufacturing, oil & gas, energy, and transportation, and enables local data processing. As data volumes are projected to surge, the need for low-latency processing and real-time decision-making solutions, IoT adoption across industries, and the advent of 5G networks for high-speed communication experiences have become significant drivers of the edge computing market. These factors, coupled with the emergence of autonomous vehicles and connected car infrastructure, highlight the need for efficient management of growing data volumes and the rising demand for low-latency processing.
Organizations across industries are relying on centralized cloud computing and storage solutions to manage the increasing amount of data. However, edge computing is becoming a popular solution that can help businesses streamline their operations, enhance performance, and automate core processes. The growth of the edge computing market is further supported by the increasing adoption of 5G networks and the demand for high-performance smartphone applications. In April 2022, Casa Systems, a technology solutions provider, secured a multi-year contract from Verizon to supply its 5G Core Network Functions for the company's public mobile edge computing service offering. Additionally, Verizon plans to invest around US$ 40 million in Casa Common Stock, indicating a positive growth trend for the edge computing market, especially with major players investing in the technology.
Impact of COVID-19 Pandemic on Edge Computing Market
North America is a leading market for smartphones and IoT-based technologies, owing to its high adoption and development rates of emerging technologies. Throughout the COVID-19 pandemic, North America held the largest share of the edge computing market. The United States and Canada are the dominant players in North America's IT sector. The work-from-home model has led to an increase in the deployment of edge computing in businesses. Even after the pandemic subsides, the significant shift in day-to-day activities due to remote working models, virtual collaboration, increased video streaming, surged online gaming, and greater data security needs will continue to impact the edge computing market.
Key Findings of Study
The edge computing market has been analysed on the basis of the following segments: component, application, enterprise size, industry, and geography. Based on component, the market is further segmented into hardware, software, and services. The software segment is expected to hold the largest share in the edge computing market during the forecast period. The edge computing market, by application, is sub segmented into smart cities, Industrial Internet of Things (IIoT), content delivery, augmented reality and virtual reality, and others. The smart cities segment is expected to hold the largest share in the edge computing market during the forecast period. The market, by enterprise size, is sub segmented into small and medium enterprises, and large enterprises. The SMEs segment is expected to grow at the height CAGR in the edge computing market during the forecast period. The edge computing market, based on industry, is further segmented into manufacturing, energy & utility, government, IT and telecom, healthcare, retail and consumer goods, and others. The IT and telecom segment is expected to led the edge computing market during the forecast period. In terms of geography, the edge computing market is further segmented into five major regions-North America, Europe, Asia Pacific, the Middle East & Africa, and South America. North America dominated the overall market in 2021, and Europe accounted for the second-largest share of the market in 2021.
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