The amount of digital information in existence is incredibly vast, and its growth rate is remarkable. According to the IDC’s Global DataSphere projection, the world’s data volume is expected to double between 2023 and 2037. It is forecasted that in 2025 alone, there will be a staggering 192 trillion gigabytes of data generated globally. Additionally, it is predicted that by that time, the number of Internet of Things connected devices will be three times higher than the global human population.
The expanding data volume has propelled data centers into becoming one of the most sought-after sectors in commercial real estate. JLL reports that 2023 is projected to be another record-breaking year for investments in data centers. However, amidst this increasing demand, the focus is shifting towards the rapidly growing segment known as edge data centers. Unlike hyperscale centers, which are typically situated in urban areas and have the capacity to accommodate 10,000 racks and over 80 megawatts (MW) of power.
Edge data centers have a smaller capacity ranging from 500 kilowatts to 2 megawatts (MW). As the name implies, they are strategically positioned on the outer edge of networks. Their purpose is to bring computing capabilities physically closer to users who are located farther away from the central cloud infrastructure. By doing so, edge data centers aim to reduce latency and enhance performance for users in remote or distributed locations.
The need for speed
In the current era, characterized by data-intensive applications like augmented reality (AR) and driverless cars, achieving faster compute times or “ultra-low latency” has become of utmost importance. As we engage in activities such as online meetings, using ChatGPT for conversational purposes, or streaming films, speed and connectivity have become essential expectations. The demand for seamless experiences and real-time interactions has heightened, necessitating technologies and infrastructure that can deliver rapid data processing and responsive connectivity to support these data-driven applications effectively.
To address the need for reduced latency in content delivery across its network, TV broadcaster RAI in Italy has taken a significant step. They have introduced a platform consisting of 18 new edge data centers, strategically distributed across 20 regions in Italy. The primary objective of this initiative is to achieve a remarkable latency of just 5 milliseconds, ensuring faster and more responsive content delivery to their viewers. By leveraging edge data centers, RAI aims to enhance the overall viewing experience by minimizing delays and providing seamless access to their content across the country.
“The main functionality of an edge center is not to preserve data, but to complete a task and return results as fast as possible,” says Colm Shorten, JLL’s Global Data Centre Business Development Manager. “They improve connectivity and help move packets of information across a wider net, at higher density and speed.”
The manufacturing and energy sectors have emerged as prominent drivers of demand for edge computing in the business landscape. This demand is primarily attributed to the rising levels of digitization and automation within these industries. As a result, a substantial amount of data generated in manufacturing and energy operations originates from machine-to-machine interactions. The implementation of edge computing is pivotal in effectively processing, analyzing, and making real-time decisions based on this machine-generated data. By leveraging edge computing capabilities, the manufacturing and energy sectors can optimize their operations, enhance efficiency, and capitalize on the opportunities presented by digitization and automation.
Although currently less than 10% of business data is created and processed at the edge of the network, Gartner suggests that figure will rise to 75% by 2025, leading to a greater need for distributed infrastructure. Market research analysts predict the global edge data center market to grow at a CAGR of 22.1%, reaching US$ 57.8 billion by 2031.
Small is Beautiful
Despite the persistent demand for data centers, the sector is facing negative sentiment due to the net zero carbon agenda and the associated concerns related to energy consumption. Social, political, and legislative pressures are increasing, leading to restrictions and moratoriums on new data center developments in countries like Ireland, Singapore, and the Netherlands. These challenges have created a supply-demand imbalance, prompting significant growth in secondary markets across Europe.
To address sustainability concerns, data center operators are seeking innovative solutions and turning to smaller sites as part of the solution. Sonic Edge, a modular data center firm in the UK, is actively reducing its environmental impact by utilizing immersion cooling technology and offering prefabricated edge units powered by low-cost, carbon-free energy sources. In partnership with Deep Green, they plan to deploy 50 edge pods across various UK regions, leveraging waste heat to warm swimming pools through co-located modular edge units.
According to industry experts, the expansion of edge data centers is not a matter of if, but when. As lifestyles, work, and technology continue to evolve, there is a growing need to develop sustainable infrastructure that can effectively support the increasing demand for edge computing.
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