Edge Computing — Processing and Managing Data Close to Its Point of Generation (Industry Analysis Report)
Introduction
With modern deployments of internet-connected devices — the Internet of Things (IoT) — and the arrival of fast 5G wireless network, placing compute and analytics close to where data is created has become crucial now more than ever. Edge computing — a distributed network infrastructure that enables data to be processed and analyzed closer to its source — is transforming the way data is being handled and processed from millions of devices around the world. Faster networking technologies are allowing edge computing systems to speed up the support of real-time applications such as self-driving cars, analytics and artificial intelligence (AI).
By processing and managing data closer to the devices that generate it, edge computing combats latency (data transfer delay) issues that can affect an application’s performance. This proximity to data at its source delivers strong business benefits such as better bandwidth availability and improved response times. Companies can save money by processing data locally as opposed to being dependent on a centralized or cloud-based location. The rapid growth of IoT devices together with new applications that require real-time computing power are continually driving the need for edge computing systems.
For most companies, deploying edge computing architecture is primarily influenced by the cost savings involved. However, a crucial benefit of edge computing lies mainly in its ability to process and store data faster, which improves real-time applications that are crucial to businesses. Companies such as NVIDIA have taken great advantage of processing at the edge, and this has led to the development of new system modules that include an AI functionality built on them. NVIDIA’s latest Jetson Xavier NX module small supercomputer can be assembled into smaller devices — such as robots, medical devices and drones — to bring supercomputer performance to the edge in a small form factor system-on-module (SOM).
Most AI algorithms run via costly cloud services because they require large amounts of processing power. The rising growth of AI chipsets that can handle processing at the edge will allow for better and affordable real-time responses in applications that need instant computing. Edge computing essentially helps companies unlock the potential of the vast untapped data that is created by connected devices. It also allows companies to uncover new business opportunities, increase operational efficiency and provide more reliable and consistent experiences for customers.
“With enhanced interconnectivity enabling improved edge access to more core applications, and with new IoT and industry-specific business use cases, edge infrastructure is poised to be one of the main growth engines in the server and storage market for the next decade and beyond.”
— Kuba Stolarski, research director at IDC.
Key Trends in Edge Computing
As edge computing becomes a more practical and ideal solution for enterprise IT providers, there are a number of key trends that technology leaders should be aware of. These include, but are not limited to:
Computing Edge Will Help Solve Challenges That Come With IoT Data
For enterprises that have been investing in IoT in search of new business opportunities, a common problem encountered has been the large volume of data that these devices generate, and how hard it can be to manage that data. By turning to edge computing and processing data close to the point of generation, companies can effectively manage storage costs while using AI and machine learning to identify data patterns that can impact their businesses.
Operational Technology (OT) and IT Will Converge
Historically, companies in industries like transportation and manufacturing had separate organizations for managing enterprise IT systems and industrial operations. To modernize infrastructure for the implementation of predictive maintenance solutions, these companies have started merging IT systems with industrial operations, whereby edge computing forms the core of these systems. Companies can effectively combine IT and OT operations using common hardware and a software-defined approach.
Digital Transformation Will Lead to Increased Demand for Computing Edge Solutions
To compete in today’s digital economy, many companies are turning to digital transformation. As these companies explore new data streams and continue to further digitize their operations, they will turn to edge computing as an effective means of optimizing operations.
Edge Data Centers Will Simplify Connecting Locally to the Cloud
A growing number of businesses are interested in using multiple cloud platforms, and they make their choices based on the complementary services and the capabilities of each cloud service provider. With traditional network architectures, where enterprises must come to the cloud, the benefits offered by cloud service providers are often limited. Moreover, most businesses find it challenging to connect themselves to the cloud, and they often run into failed or delayed migrations and vendor-lock due to their inherent lack of in-house cloud expertise. Edge data centers can help enterprises overcome these challenges by partnering with cloud enablers to make it more economical and faster to connect to the cloud locally. This will be beneficial for many businesses whose key goal is to be able to leverage hybrid and multi-cloud strategies.
“If edge computing is going to be a realistic future for enterprise IT, it needs the hybrid cloud and open source to thrive.”
– Paul Cormier, Red Hat President and CEO.
Applications
Edge computing can be used for shifting applications, services and data away from centralized hubs to logical extremes of a network. By using edge computing infrastructure, industries like mining, retail and banking are building strategies to personalize customer experiences and maintain continuous operations. Within each industry, there are particular use cases that drive the need for edge computing systems.
By adopting edge computing technology, mining companies can use their data to improve worker safety, optimize operations, increase productivity and reduce energy consumption. Banks can use the technology to analyze ATM video feeds in real-time to increase consumer safety. Retailers can use the technology to personalize customers’ shopping experiences and be able to communicate specialized offers. By using edge computing technology, kiosk services can automate the management and remote distribution of their services, even in situations of poor network connectivity.
Smart cities will benefit significantly from edge computing since it makes it workable for devices that control public administrations to respond quickly to changing conditions in real-time. In healthcare facilities, patients’ essential data can be continuously accessed using edge computing systems instead of interfacing with moderate and fragmented databases. By turning to edge computing technology, modern autonomous vehicles can exchange real-time sensory data and improve decisions with fewer onboard-resources — lowering the growing expense of autonomous AI systems. With its many other uses in various industries, edge computing is yet to transform the modern world in unprecedented ways.
Key Players
The following companies are some of the key players in edge computing:
Microsoft
As one of the best-known market leaders in cloud computing and intelligent business operations, Microsoft currently holds more than 300 patents in the edge computing field. The company recently launched its Azure IoT service, which features an all-in-one package of tools and container modules for the modern-day cloud innovators.
Amazon Web Services
Amazon Web Services has soared to the top of the charts for its various cloud offerings over the years, and is currently one of the leading cloud solutions that offer easy entry points into edge computing. The company’s CloudFront environment offers an easy edge-based content delivery infrastructure.
IBM
IBM has been disrupting the tech industry by specializing in almost every aspect of digital transformation. The company provides an autonomous management offering that addresses the variability, scale and rate of change in edge environments. This offering provides solutions to help telecommunication companies modernize their networks and provide new services at the edge.
Dell Technologies
Dell is another well-known company that has been making its way into the edge computing environment. The key elements of the company’s approach to edge computing have included offerings like Edge Gateways, Isilon storage facilities and PowerEdge C-Series servers. Furthermore, the company is working on Project IRIS, which is aimed at delivering extended security strategies along the edge of cloud computing.
Hewlett-Packard
Hewlett-Packard Enterprise recently invested $4 billion into its developing edge network portfolio. The company offers access to its “Edgeline Converged Edge Systems” which converge operational technology (OT) with enterprise-class IT to enable innovative new abilities at the edge.
Cisco
Cisco has started experimenting with new opportunities on the edge of cloud computing. The company allows users to deploy a low-latency range of edge services using its most trusted infrastructure environments. Its “Network Services Orchestrator” can be used by businesses to deliver high-quality services to end-users on the edge.
Google Cloud Platform (GCP) recently unveiled a new Global Mobile Edge Cloud (GMEC) strategy tied to the flourishing 5G wireless network initiative. As part of the GMEC strategy, GCP and telecommunications company AT&T will collaborate to help enterprises leverage Google Cloud’s technologies and capabilities using AT&T’s network connectivity at the edge.
10% of enterprise-generated data is created and processed at the edge — outside a traditional centralized data center or cloud. The figure will rise to 75% by 2025, according to a report by Gartner.
Market Size
According to Grand View Research, the global edge computing market size was valued at USD $3.5 billion in 2019. The market registers a compound annual growth rate (CAGR) exceeding 37% from 2020 to 2027. The market continues to grow exponentially since companies are starting to offer AI-enabled edge solutions to meet the demand for more powerful computing at the edge. In the USA, the edge computing market is flourishing and shows significant growth as recorded from 2016 onward (see Figure 2). Among the various industries shown in Figure 2, manufacturing emerges as the industry with a significant share of the market value.
Edge computing for IoT is expected to bring several advantages for many IoT deployments as compared to using the cloud for processing and managing data. Many IoT processors deliver an increased level of automation at the edge, resulting in low latency which is useful for rapid data processing. For this reason, IoT-edge partnerships are expected to revolutionize data computing and contribute significantly to the growth of the edge computing market.
To show the competitive analysis for the various key stakeholders in edge computing, Fact.MR market research company has compiled results shown in Figure 3. These results are based on the strategies adopted and the brands’ current offerings.
As can be noted from the results shown in Figure 3, front runners in the edge computing market are those that adopt strong strategies while providing quality offerings. Brands such as Microsoft have proven to be competent, while others, such as the HUESKER group, still have to work towards improving their strategies and current offerings in order to strengthen their presence in the market.
29 billion: That is the latest projection for the number of connected devices on the global network by 2022. Roughly 18 billion of those devices will be related to the Internet of Things — requiring technologies such as edge computing to mitigate data latency issues, according to Telecommunications Industry Association.
Benefits
Edge computing comes with a plethora of benefits for the digital world, and some of them include:
Speed
A crucial benefit of edge computing lies in is its ability to increase network performance by reducing latency. For most companies, speed is vital for the core running of a business. For companies that provide data-driven services to customers, lagging speeds can frustrate customers and cause long-term damage to their brand.
Security
Traditional cloud computing architecture is inherently centralized, and this makes it vulnerable to distributed denial of service (DDoS) attacks — the malicious attempts to disrupt normal traffic of a targeted server or network. Edge computing makes it difficult for any single disruption to take down the network by distributing processing, storage and applications across a wide range of devices and data centers.
Scalability
The developments of cloud-based technology and edge computing have made it easier than ever for businesses to scale their operations. Computing, analytics and storage capabilities can be bundled into devices that can be placed nearer to end-users. Edge computing systems allow companies to leverage these devices to expand their edge network’s reach and capabilities without having to worry about insufficient computing resources.
Versatility
Since edge computing is scalable, this also makes it versatile. By partnering local edge data centers, companies can target desirable markets without having to invest in expensive infrastructure expansion. Edge data centers allow such companies to service end-users efficiently with little physical distance or latency, which is especially valuable for content providers looking to deliver uninterrupted streaming services. By incorporating new IoT devices into their edge network architecture, companies can offer new and better services without having to overhaul their IT infrastructure.
Reliability
Since IoT edge computing devices and edge data centers are positioned closer to end-users, there is less chance of a network problem in a distant location affecting local customers. Even in the cases where there is a nearby data center outage, IoT edge computing devices will continue to operate on their own since they handle vital processing functions natively.
Challenges
Despite the many benefits that edge computing has, there are several challenges that businesses need to be aware of. These include:
Power
Businesses will need high-power processors in order to provide their commercial customers with cloud-like remote services. As a result of this, these businesses will need high-voltage, three-phase electricity, which can be difficult to attain in rural, remote areas.
Data Wastage
Edge computing uses a subset of data for processing purposes, implying that a lot of raw data goes to waste. Part of this wasted data may have been crucial and could have provided some additional insights that may have been overlooked. Businesses are thus challenged to segregate data in a way that improves efficiency while avoiding the loss of critical data.
Network Bandwidth
As more data is stored on the edge, the network bandwidth will shift. Usually, enterprises allocate higher bandwidth to data centers while a lower portion is allocated to the endpoints. A challenge posed by edge computing is the need to balance more bandwidth across the network.
Use Cases
Businesses need to correctly identify the functions they want to perform on the cloud and those that must be carried out at the edge. This will somehow be challenging but will be critical as it will eventually justify such businesses’ return on investments.
Conclusion
The rapid growth and increasing computing power of the Internet of Things (IoT) devices have resulted in unprecedented volumes of data, and these will continue to grow as 5G networks increase the number of connected devices. In the past, the cloud and artificial intelligence (AI) were highly depended on for speeding innovation by driving actionable insight from data. However, the scale and complexity of data created by connected devices have outpaced modern network and infrastructure capabilities. Edge computing offers a more efficient alternative whereby data is processed and analyzed closer to its point of generation. Since this data does not traverse over a network to a cloud or data center to be processed, latency and bandwidth issues are significantly reduced.
Despite the plethora of benefits that edge computing has, there are several challenges that businesses still need to consider. These include high power requirements and the need to segregate data in a way that improves efficiency while avoiding critical data wastage. Nevertheless, edge computing stands out since it enables faster and more comprehensive data analysis — creating the opportunity for faster response times and improved customer experiences. Improvements in modern, fast wireless networks and the rise in real-time applications that need processing at the edge will only continue to drive the technology ahead. Businesses thus need to explore how edge computing could impact their current operations and how it could open up new opportunities for growth.
