Reducing OpEx and automating workflows

Forging toward the edge, while increasing productivity and accelerating decision-making, has become ubiquitously mainstream.

The pandemic brought a vast number of realities to the forefront. Distributed computing is no longer a nice-to-have option, but an imperative decision. Several enabling technologies, such as hybrid cloud and 5G connectivity, are finally tying in together and enabling the new standard in distributed computing – which is edge.

Edge’s impact will not be restricted only to software and solutions; verticals like manufacturing will also be vastly improved. Ahead of 2022, trends like the edge/ML confluence, 5G interplay, and its convergence with IT and operational technology held sway. Now, most industry forecasting centers around its adoption and further refinement, and the industry is bracing to reach edge-native, a state of complete synergy. One of the resultant issues is the sheer scale of edge operations.

Edge computing is transforming the way data is being handled, processed, and delivered from millions of devices around the world. It allows data from Internet of Things (IoT) devices to be analyzed at the edge of the network before being sent to a data center or cloud. The explosive growth of internet-connected devices – the IoT – along with new applications that require real-time computing power, continues to drive edge-computing systems.

The security issues concerning edge computing are complex and have the potential to cause roadblocks in its growth. As the enterprise edge expands to encompass everything from the factory floor and oil rigs to solar arrays and retail stores, overcoming the challenges of processing, managing, and securing data traffic close to the source has become a top priority for many organizations.

The edge gateways, while processing data from sensors, monitors, industrial controllers, and other devices at the edge, are the devices that pass only actionable information over the WAN to cloud and enterprise data centers, weeding out bandwidth-hogging noise – for example, pressure sensors on an oil rig showing everything is fine.

As it stands, the edge-gateway market is immature and fractured. A range of infrastructure incumbents, providers of data-center gear, and startups have launched new edge-gateway products in the last couple of years, offering a variety of approaches to taming the edge.

Table stakes for edge gateways are still being defined, but at a minimum they must move at least some processing and storage capabilities from the data center to the edge. Encryption, device security and management, connectivity to constrained devices and OT networks, WAN connectivity, and ruggedization are common across edge gateways. And their features, such as zero-trust and pre-built integration with analytics platforms, vary from vendor to vendor.

The shifts in the edge computing market can be directly traced to pandemic-driven internet traffic spikes. Stay-at-home orders during 2020 pushed huge numbers of workers and students online. The internet traffic on fiber copper networks peaked, as did mobile internet traffic, and traffic on cable networks above pre-pandemic thresholds.

As a result, operators that had earmarked money for edge computing tests and deployments before the pandemic immediately redirected that spending into their core operations to handle the spikes. That left companies hoping to support operators’ edge computing services – whether it was cloud gaming or streaming virtual reality – high and dry; perhaps, not surprisingly, some edge computing players did not make it through Covid-19.

For example, less than two years after its formation, Ericsson’s Edge Gravity, an accelerated unit launched within the giant vendor, came crashing to the ground. The internal startup unit had been developing a global edge cloud network that Ericsson could offer to the many telcos seeking to build an edge services business. During its brief history, the Edge Gravity team had attracted scores of partners, including the likes of Bharti Airtel, China Unicom, KDDI, NTT DoCoMo, SingTel, Telenor, Telstra, Vodafone, and more.

The decision by Ericsson to abandon the initiative indicates how tough it is for any company to rival the webscale giants, which have a global presence, tried and trusted platforms that application developers are happy to work with, and increasingly close relationships with telcos – Amazon Web Services (AWS) is offering its Wavelength and Outpost distributed platforms, which are like catnip to telcos, such as Verizon, SK Telecom, Vodafone, and more; Google Cloud is forging multiple edge partnerships with the likes of Telefónica and TIM, based on its Global Mobile Edge Cloud and Anthos for telecom offerings; and Microsoft Azure has developed its Stack Edge offering for CSPs.

When Ericsson launched Edge Gravity, the webscale giants were largely seen as rivals to the telcos – now, though, the telcos and webscales are best buddies, with their relationships deepening by the day, leaving little opportunity for vendors to build a collaborative, cross-industry proposition in the telco edge market that can compete.

Other startups too faced similar fate. EdgeMicro entered liquidation. In 2019, EdgePresence had announced it would build EdgePods. DigitalBridge’s DataBank had announced a USD 30-million investment into EdgePresence, DigitalBridge’s cell tower business, Vertical Bridge, now has plans to eventually install EdgePresence’s mini data centers at the base of some of its cell towers. AlefEdge, and Vapor IO too had to rework their strategic focus.

The global market for edge computing, estimated at USD 4 billion in the year 2020, is projected to reach a revised size of USD 17.8 billion by 2026, growing at a CAGR of 27 percent over the 2011–2026 period by ResearchAndMarkets.

Edge meets local computing requirements as data being processed in micro-data centers. Applications that are process-intensive, involving advanced technologies like AI, ML, and IoT have and continue to witness rapid development. An increasing number of smart cities have started investing in edge computing to avoid reliance on the cloud for data processing and analytics.

Growing emphasis on process automation and cost reduction, combined with intensifying business competition, is also anticipated to drive market growth. Increased adoption of edge computing for data center application would also lead to market growth.

Hardware is projected to grow at a 26.2-percent CAGR to reach USD 10.4 billion by the end of 2026. The growth in the Platform segment has been readjusted to a revised 28.3-percent CAGR for the next seven-year period.

This segment currently accounts for a 19.8-percent share of the global edge computing market. Technologies, such as MEC, EDC, and AMR are increasingly employing routers, sensors, gateways, and edge nodes, which is propelling the requirement for hardware components in edge computing. The hardware segment is also expected to grow at a substantial pace over the next decade, attributed to large-scale deployment of hardware components in edge computing services.

India too has its share of edge-computing startups. MobiDev, SPEC India, Lihjt IT, Queppelin, Ksolves India, Stratahive Services, Arnowa India, DAC.Digital, and Nutanix are the leading companies.

The future outlay is clear for the edge. Computers are running more complex calculations, sending more data, and often sending transient data that does not require cloud storage. Devices are getting smarter, and there are more of them out there. Companies and consumers want to access their data quickly, reliably, and securely. Edge computing satisfies these growing demands, and it will grow accordingly.

Many telcos are looking at edge computing as a good opportunity to leverage their existing assets and resources to innovate and move up the value chain. Cloud hyperscalers, especially the biggest three – Amazon Web Services (AWS), Microsoft Azure, and Google – are at the forefront of the market too. However, each stakeholder lacks a significant piece of the stack which the other has. This is the cloud platform for operators and the physical location for hyperscalers.

Operators acknowledge that even if they do own the edge stack, they still need the support of hyperscaler clouds to create a seamlessly distributed computing environment required by many applications. To fuel the edge market and build its momentum, operators will, in the most part, work with the cloud providers. Partnerships between operators and hyperscalers are starting to take place and shape the market, impacting edge computing short- and long-term strategies for operators as well as hyperscalers and other players in the market.

Going to market alone might not be an attractive option for either operators or hyperscalers at the moment, given the high investment requirement without a guaranteed return. The partnerships between two of the biggest forces in the market will provide the necessary push for the use-cases to be developed and enterprise adoption to be accelerated. However, as markets grow and change, so do the stakeholders’ strategies and relationships between them.

Private cellular networks too cannot be decoupled from edge computing. Mobile network operators (MNOs) are continuously looking for new sources of revenue beyond providing traditional connectivity, particularly in the enterprise segment. MNOs can take private network solutions to market, coupled with edge computing platforms and applications. An example of this is Vodafone, who is working with Microsoft to provide Azure Private Edge Zones to enterprises.

Non-mobile operators are also making a play. Verizon Business announced a partnership with Nokia to take private 5G networks to market, even though the telco does not own spectrum in markets outside the US However, it believes it is in a good position to take such solutions to enterprises, given the size of its existing enterprise network services business globally.

Around the world, carriers are deploying 5G wireless technologies, which promise the benefits of high bandwidth and low latency. Instead of just offering the faster speeds and telling companies to continue processing data in the cloud, many carriers are working edge-computing strategies into their 5G deployments in order to offer faster real-time processing, especially for mobile devices, connected cars and self-driving cars.

Wireless carriers have begun rolling out licensed edge services for an even less hands-on option than managed hardware. The idea here is to have edge nodes live virtually at, say, a Verizon base station near the edge deployment, using 5G’s network-slicing feature to carve out some spectrum for instant, no-installation-required connectivity. Verizon’s 5G Edge, AT&T’s Multi-Access Edge, and T-Mobile’s partnership with Lumen all represent this type of option.

Gartner’s 2021 strategic roadmap for edge computing highlights the continued industry interest in 5G for edge computing, saying that edge has become part and parcel of many 5G deployments.

With constantly increasing volumes of data cycling, there are some non-negotiable capabilities telcos need to employ to meet demand while pursuing day-to-day functions. Though it may seem daunting, telecom operators that want to modernize at the edge will need to transform their IT architecture and operations, integrating capabilities with business priorities. They will need to find tools to ingest their massive amounts of data with demonstrated data-heavy use-cases, provide low latency, high-speed processing, and ensure 99.999-percent data availability at edge locations closest to end-users. Doing so will position them for high performance and edge leadership, especially while pursuing a low total cost of ownership or high total economic impact. It is only then that they can expect to experience lower churn rates, increased subscribers, and higher revenues.

5G as a technology is a long-term play that will take place over the next several years, but organizations should get started on their journeys, or risk being left behind. The use-cases and benefits are clear, and barriers to entry are manageable for enterprises to overcome. By leaning into edge computing as a core catalyst to scale 5G across the business through the convergence of fast, reliable connectivity, and data, companies will capture the full potential of all the value 5G has to offer.