IDC says worldwide spending on edge computing is projected to hit $232 billion in 2024, marking a 15.4 percent increase from 2023.
This surge in spending on edge computing is expected to continue robustly through 2027, with combined enterprise and service provider investments across hardware, software, professional services, and provisioned services for edge solutions nearing $350 billion.
IDC defines edge computing as ICT-related actions performed outside of centralized data centers, serving as an intermediary between connected endpoints and the core IT environment. Characterized by its distributed, software-defined, and flexible nature, edge computing’s value lies in moving computing resources to physical locations where data is created, transacted, or stored, thereby enhancing business processes, decisions, and intelligence outside of the core IT environment.
Dave McCarthy, Research Vice President for Cloud and Edge Services at IDC, emphasized the pivotal role of edge computing in the deployment of AI applications, noting that organizations seeking scalability and performance enhancements are turning to the distributed architecture provided by edge computing. This trend presents a significant market opportunity for Original Equipment Manufacturers (OEMs), Independent Software Vendors (ISVs), and service providers, who are expanding their feature sets to facilitate AI in edge locations.
IDC segments edge ICT spending across 19 enterprise industries, encompassing more than 500 named enterprise use cases in six domains. In the service provider sector, investments are primarily directed towards edge services delivery, focusing on infrastructure spending for multi-access edge computing (MEC), content delivery networks, and virtual network functions, which collectively account for nearly 22 percent of all edge spending.
Enterprise adopters, including the public sector, are making substantial investments in various edge use cases, such as augmented maintenance, production asset management, AI-augmented supply and logistics, and in-home remote patient monitoring. Emerging edge use cases, including autonomous mining operations and augmented training, are anticipated to experience rapid spending growth over the forecast period.
Marcus Torchia, Research Vice President for Data & Analytics at IDC, highlighted the shift in enterprise investments towards infrastructure expansion and greenfield deployments over the past 24 months, driven by the desire to bolster local computing infrastructure capabilities and deliver new services and products. Torchia noted that while multi-access edge computing offerings are expected to receive significant investment, enterprises are also seeking to rationalize total service provider outlays, leading to a dynamic market of capex and opex-based edge offerings competing for investment dollars.
Hardware investment will continue to dominate edge spending, particularly driven by service provider infrastructure, with edge gateways, servers, and network equipment being key areas of focus. Adoption of provisioned services by enterprises is anticipated to surge, surpassing hardware share by 2026 for the first time. Within provisioned services, connectivity and Infrastructure-as-a-Service (IaaS) are expected to represent the greatest share and fastest growth categories, respectively. On-premise software will remain a critical component of edge infrastructure but is expected to be the smallest category in terms of overall spending.
