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Edge data centre growth to reach $14bn by 2026

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Edge data centres will account for most of the telecom server market growth and is projected to reach US$14 billion by 2026 according to a new report from Dell’Oro Group.

“Data centre IT and telecom network infrastructure have been converging in recent years,” said Baron Fung, research director at Dell’Oro Group.

“Service providers have been replacing dedicated devices with unique hardware architectures in the mobile core network with commercial off-the-shelf (COTS) hardware to virtualise various network functions.”

The Telecom Server Advance Research Report includes a five-year market forecast for servers deployed by service providers for IT and network functions and servers deployed by enterprises for MEC applications.

It adds that edge use cases for broadband access, MEC and RAN are still in the nascent stage and are expected to exceed 50% compound annual growth rate (CAGR) in server revenue over the company’s forecast horizon.

“Network function virtualization has the potential to reduce capex through the use of less expensive and commoditised COTS hardware, instead of dedicated or proprietary hardware for network services,” added Fung.

“Furthermore, a new class of latency-sensitive applications in the form of multi-access edge computing (MEC), and virtualisation of the baseband functions in the radio access networks in the form of Open RAN, will pave the way for the explosive growth of a new class of servers located at the network edge.”