A report by global real estate consulting firm JLL has revealed that projected surge in data-dependent technologies, including the Internet of Things (IoT) and generative artificial intelligence (AI) will require substantial IT infrastructure support provided by edge data centers. JLL predicts edge IT infrastructure and data centers will become a US$ 317 billion market globally by 2026, representing a 107% growth from the 2020 market valued at US$ 153 billion.
“Edge data centers will be essential to ensure both seamless business operations in the future economy while also improving security measures and protecting against potential disruptions,” said Jonathan Kinsey, EMEA Lead and Global Chair, Data Centre Solutions, JLL, adding, “By lowering latency by bringing the computing infrastructure closer to the data source and user, edge IT infrastructure will become an essential component in the international economy.”
JLL’s estimate of a US$ 317 billion total addressable market comprises the complete IT infrastructure, colocation revenue, colocation supply and cloud services revenue, all specifically at the edge. From the IT infrastructure lens, the edge computing market consists of all the IT hardware, including storage, computing and networking equipment that enable the delivery of digital services at the furthest points of a network.
The report said that globally, the growth of edge computing will be influenced by the not only the emergence several technology-based megatrends, but also the need for faster data transfer and high computation, as well as factors such as policies and regulations. It further said that the rise of edge IT infrastructure focused on data centers will mirror the growth of IoT devices, which JLL analysis projects will expand at a compound annual growth rate (CAGR) of 9.8% over the next five years.
In addition, the report revealed that Asia Pacific (APAC) and the Middle East North Africa (MENA) regions, which hold significant growth potential due to rising internet and mobile penetration among the rural population, will further support opportunities in the addressable edge data center market.