The Future of Edge Computing: Worldwide Spending to Reach US$232 Billion by 2024

The future of technology is on the edge, quite literally. According to the latest forecast from the IDC Worldwide Edge Spending Guide, worldwide spending on edge computing is set to reach a staggering US$232 billion in 2024, marking a significant 15.4% increase from the previous year. This trend is expected to continue through 2027, with spending projected to reach nearly US$350 billion.

But what exactly is edge computing? IDC defines it as the ICT actions performed outside of centralized data centers, acting as the intermediary between connected endpoints and the core IT environment. Characterized by its distributed, software-defined, and flexible nature, edge computing brings computing resources closer to where data is created, transacted, or stored, enabling businesses to make faster decisions and drive intelligence outside of traditional IT environments.

Dave McCarthy, research vice president at IDC, highlights the pivotal role that edge computing will play in deploying AI applications. To meet scalability and performance requirements, organizations will need to adopt a distributed architecture approach that edge computing provides. This market opportunity is being seized by OEMs, ISVs, and service providers who are extending their feature sets to enable AI in edge locations.

The IDC report segments edge ICT spending across 19 enterprise industries, covering more than 500 named use cases in six domains. For service providers, investments in edge services delivery are focused on infrastructure spending for multi-access edge computing (MEC), content delivery networks, and virtual network functions, accounting for nearly 22% of all edge spending this year.

Enterprise adopters, including the public sector, are investing in a variety of edge use cases with rapid growth potential through 2027. These include augmented reality, AI-augmented supply chain management, remote patient monitoring, and contextualized marketing, among others. Emerging edge use cases such as autonomous mining operations, pipeline inspection, and expert shopping advisors are also forecasted to see significant spending growth in the coming years.

Marcus Torchia, research vice president at IDC, notes that enterprise investments are shifting towards infrastructure expansion and greenfield deployments, with a focus on building robust local computing capabilities. The largest portion of investments in edge solutions this year will come from discrete and process manufacturing industries, followed by retail and professional services.

As the market for edge computing continues to evolve, hardware spending will remain a key component, driven by investments in edge gateways, servers, and network equipment. However, provisioned services are expected to surge in adoption, surpassing hardware spending by 2026. Connectivity and Infrastructure as a Service (IaaS) will represent the greatest share and fastest growth categories within provisioned services.

China is expected to experience the fastest spending growth in the coming years, with compound annual growth rates of 16.2% and 15.3%, respectively. With the increasing adoption of edge computing across industries, the future of technology is undoubtedly on the edge.