Asia/Pacific Edge Spending Expected to Hit $84 Billion in 2028 -- IDC

According to the latest IDC Worldwide Edge Spending Guide, Asia/Pacific* spending on edge computing is forecasted to reach $48.9 billion in 2024, an increase of 16.2% over 2023. This includes combined enterprise and service provider spending on hardware, software, professional services, and provisioned services for edge solutions. IDC expects spending on Edge to grow at a five-year CAGR of 15% over the forecast period (2023-28) and reach USD 84 billion by 2028.

IDC defines edge computing as encompassing all technology-related actions outside of centralized data centers, serving as an intermediary between connected endpoints and the core IT environment.

Edge is a crucial technology infrastructure that extends and innovates the capabilities found in core datacenters, whether enterprise- or service-provider-oriented. The edge ecosystem comprises various technologies and services, including:

  • Computing infrastructure, such as servers, storage, and networking equipment;

  • Software solutions, including system infrastructure, security, and application development and deployment;

  • Professional services for implementation and management services; and

  • Provisioned services, delivering cloud-based technologies.

The IDC Edge Spending Guide segments edge spending for more than 500 named enterprise use cases related to six domains – Artificial Intelligence (AI), Internet of Things (IoT), Augmented Reality (AR), Virtual Reality (VR), Drones, and Robotics – unlocking significant opportunities across various industries.

“Synergy between the different domains will help create new use cases further and drive traffic flows between end user devices, edge server/storage infrastructure, and cloud-hosted infrastructure. End user devices such as smartphones are already being equipped with neural, image, and graphics processors which can be used to execute Generative AI models, albeit reduced, to provide learning capability which in turn will drive the performance and capacity requirements for AI, AR, drones and VR domains at the edge infrastructure,“ says Bill Rojas, Adjunct Research Director for IDC Asia/Pacific.

IDC forecasts all 19 enterprise industries profiled in the spending guide will see a five-year double-digit compound annual growth rates (CAGRs) over the forecast period in the region. Manufacturing will see the largest investment in 2024 on edge solutions from an industry end-user perspective, followed by Professional Services, Government, and Telecommunication. Businesses and industries in the region are investing in edge to harness the benefits of low latency, real-time analytics, and improved efficiency in various applications. Production Asset Management, Autonomic Operations, Inventory Intelligence, Telecom Base Station Remote Management, General Infrastructure PSER, and Supply Chain Resilience are the top use cases that are witnessing rapid adoption in the region and follow similar growth patterns to the host industries.

The service provider segment is expected to grow at 18.2 % CAGR. This growth is driven by infrastructure investments in edge service delivery, particularly in areas like multi-access edge computing (MEC), content delivery networks, and virtual network functions.

“Asia/Pacific* will experience a surge in the adoption of edge, largely due to enterprises investing in building edge applications that necessitate faster decision-making, improved operational efficiency, and reduced latency, and the region's rapid adoption of IoT, 5G, and AI technologies,” says Sharad Kotagi, Market Analyst, IT Spending Guides, IDC Asia/Pacific.

From a technology perspective, in 2024, the largest portion of spending is expected to remain in the hardware category, followed by provisioned services, primarily driven by purchases of connectivity and SaaS. Services will be the fastest growing technology category with a five-year CAGR of 21.5% with a focus on support and deployment and project-oriented services. Software spending will grow at 8.8% CAGR during the forecast period, accounting for 10.3% of the total spending in 2028.

China is projected to maintain its position as the dominant market for edge, with more than 60% in 2024, followed by ANZ (Australia & New Zealand), India, and South Korea. Countries with the fastest edge spending in 2024 are China and Indonesia. This rapid growth is primarily driven by strategic initiatives such as smart cities, Industry 4.0, deployment of commercial 5G, and e-commerce.

To learn more, visit: www.idc.com

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