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The growth of edge computing and what it means for data centers

September 21, 2020

The growth of edge computing and what it means for data centers
Businesses are investing in edge computing in a big way—the market is expected to surpass $3.24 billion by 2025. Enterprises are projected to spend an average of 30 percent of their IT budgets on edge cloud computing over the next three years, according to “Strategies for Success at the Edge, 2019,” a report by the global consulting firm, Analysys Mason.
The IT industry is seeing a paradigm shift—with companies now processing a larger portion of their data locally “at the edge” and sending it to the cloud after it’s processed rather than moving it back and forth to and from the cloud. Gartner predicts by 2025, three-quarters of enterprise-generated data will be created and processed at the edge—outside a traditional centralized data center or cloud. This represents a 10% increase since 2018.
Here are some trends you can expect to see moving forward:
#1       Major cloud providers are moving to the edge
“Hybrid is no longer a dirty word,” says Dave McCarthy, research director at IDC. “Cloud service providers are offering solutions that extend on-premise or on-device and are partnering with co-location providers and telecom providers to enable enterprises to deploy applications at the city or neighborhood level.”

#2       5G will have a major impact
Among the reasons for growth in edge computing are the inherent limitations of cloud computing—factors such as latency, bandwidth and regulatory data restrictions. The emergence of 5G will help address these drawbacks. “5G will enable both more flexibility in using the cloud to house traditionally latency-prone applications and, at the same time, will enable new opportunities for edge computing because of improvements in bandwidth speed and cost,” writes Jamie Bourassa of APC by Schneider Electric.

#3       Micro data centers will become more prevalent
Edge computing appliances are being miniaturized—expect to see more and more IT servers that are one-third the size of traditional servers. This will speed up the growth of micro data centers serving as the core infrastructure for edge computing. These micro data centers can be monitored remotely, helping to streamline technology deployments and eliminating the need for IT personnel on site.
#4       IT and operational technology (OT) will converge
Up until now, companies in verticals like manufacturing, transportation and energy have had completely separate organizations to manage enterprise IT systems and day-to-day operations. That is changing in the era of edge computing, with businesses moving to a software-defined approach—making use of common hardware to manage both IT and OT workloads for greater efficiency.
The push for digital transformation is fueling demand for edge computing
As companies further digitize their operations and explore new data streams for more precise and targeted decision-making, edge computing has become an attractive option—not as a replacement but as an extension of the cloud model. To learn more about what edge computing can mean for your data center customers, contact one of our data center experts: Samuel Alt at samuel.alt@ingrammicro.com or Nick Vermiglio at nick.vermiglio@ingrammicro.com.


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