"The development of new devices and software technologies in response to growing requirements is accelerating global computing demand,” said Vlad Galabov, principal analyst for data center IT, at Omdia. “At the same time, the nature of devices and applications is changing where the collection and real-time processing of data are becoming increasingly important. As a result, latency and bandwidth are becoming key performance determinants and are driving the need for better telecommunication networks and more computing power to be placed closer to end users and machines.”
Omdia defines the edge as locations with a maximum 20 milliseconds (ms) round trip time (RTT) to the end user, device or machine. This includes telco IT-operated sites like central offices (COs) and regional data centers (DCs), cloud service provider points of presence with equipment deployed at colocation provider DCs and enterprises deploying servers at branch offices, retail stores, campus sites and colocation provider DCs.
Omdia's research found that 32.2 percent of servers shipped to telcos in 2024 will be deployed at edge locations, up from 22.8 percent in 2019. A large portion of the servers telcos have deployed at the edge so far are used for content delivery networks (CDNs). Surveying telcos, Omdia found that many edge located server deployments will be justified by cost savings achieved by virtualizing network functions, followed by revenue-bearing new services.
“By 2024, a smaller portion of telco edge located servers will be running CDNs or virtual network functions (VNFs) in favour of other workloads such as video content delivery, vehicular communication for autonomous vehicles, AR/VR and gaming,” Galabov said.
Omdia expects 12.2 percent of servers shipped to hyperscale cloud service providers (CSPs) to be deployed at edge locations by 2024, up from 5 percent in 2019. Drivers for the growth of the hyperscale CSP edge include the popularization of video streaming, which requires effective content delivery networks, and the pursuit of new services such as cloud gaming, PC as a service, and cloud AR and VR, where the latency between the end user inputting commands and the cloud-located server becomes critical.
The tier-two CSP edge will represent 36.7 percent of all servers shipped to tier-two CSPs in 2024, up from 31.4 percent in 2019. Many of the local second-tier CSPs, which largely operate within a country, by default have their data centres located within very close proximity to their end users. This close proximity has been one of the unique differentiators for local CSPs when faced with competition from hyperscalers.
Latency tests between servers located in the same region/city as end users showed that nearly half of those servers had sub-20ms RTT.
The Omdia forecast takes into account the local tier-two CSPs’ close proximity to the end user/device and the fact that larger Tier 2 CSPs like IBM, Apple, Oracle, and SAP currently have a more centralised server deployment model, resembling a hyperscale CSP. Omdia expects the latter to increase their number of edge locations to launch new services in an attempt to compete with hyperscale CSPs.
Omdia forecasts 37.6 percent of servers shipped to enterprises will be deployed at edge locations by 2024, up from 28.4 percent in 2019. As shown in the figure below, enterprises were early adopters of edge computing for latency sensitive workloads like healthcare and industrial applications; on-site data consolidation, data sharing, and analytics; and retail store management.
“One driver for enterprises moving more servers to the edge is the expansion of automated manufacturing and the use of IoT devices. Just a few examples of latency-bound workloads that spring to mind are smart factory motion control, real-time plant asset management and self-diagnosis, augmented reality for factory management and repair, robot-aided surgery and new retail store operation models,” Galabov said.
