Edge compute and artificial intelligence will outgrow core compute power over the next five years, according to an IDC report commissioned by Inspur systems.
The annual study analyzed the compute-related economic trends across the US, Canada, South Korea, Australia, the UK, France, Germany, Italy, China, India, Malaysia, Brazil, Russia, and South Africa — and found edge compute and AI were among the fastest-growing segments.
In the wake of the COVID-19 pandemic, IDC reports server spending tanked, only to be offset by a surge in edge compute spending. This trend should come as no surprise, since the tech – which pushes compute resources out of the datacenter and closer to users – is seen as a key enabler for several emerging and established markets, including 5G, IoT, robotics, AI, transportation, manufacturing, and energy.
According to IDC, while the US and China — the two leaders across the board — have dominated the edge compute market over the last several years, Germany and the UK have “stepped up their efforts” to carve out a niche in this lucrative market.
The report found Germany and the UK’s edge compute power grew at a much faster pace compared to other developed nations. What’s more, European organizations reported a strong desire for edge compute technologies, with 30 percent saying they plan to deploy the tech within the next two years.
It’s a similar story with AI, which accounts for 12 percent of all IT spend today, IDC reports. That’s up from 9 percent in 2016, and is expected to reach 25 percent by 2025.
“Based on distributed computing systems, large-scale, pre-trained models have demonstrated unprecedented performance in many AI tasks, continuously increasing the industry’s expectations of the capacity boundaries of deep learning models,” the report reads.
Together, IDC estimates that edge and AI will account for roughly half of all IT spend by 2025.
Datacenters aren’t dead
While edge and AI have seen explosive growth in recent years, the datacenter remains home to the majority of compute power. Hyperscale datacenters account for 50 percent of all computing power across the countries surveyed, with the majority based in the US and China.
Datacenter may still be top dog when it comes to compute density, but public and private cloud are growing significantly faster. This is fueled in part by strong demand among leading countries, like the US and China, for public and private cloud resources.
So while collectively the cloud only accounts for 20.4 percent of IT infrastructure, IDC found “up to 60.7 percent and 31 percent in the leading and catchup countries” preferred cloud compute.
The internet is the king of compute, finance and manufacturing on the rise
These trends are borne out in IDC’s analysis of compute distribution across industries. Unsurprisingly, internet-related industries continue to consume the largest stake of compute resources, accounting for roughly 30 percent of all IT spend in 2021.
According to the report, 90 percent of IT infrastructure purchased by internet enterprises last year was deployed in cloud computing environments.
But while internet-related businesses remained the largest consumer of compute, the past year saw the financial market narrowly leapfrog manufacturing for the number two spot.
“The financial industry has outperformed the manufacturing industry in terms of total investment and growth rate in compute capacity and applications represented by AI and big data, resulting in its rise to second place,” IDC reports.
This is due in large part to the wide scale use of AI in this space, predominantly for customer service and risk management. “Major global banks, including Bank of America, JPMorgan Chase, Capital One, Mastercard, and American Express have adopted chatbots to optimize their digital banking services,” the report found.
While finance is head over heels for AI, the manufacturing space is all about edge compute and IoT. In 2021, IDC reports that manufacturing accounted for 12 percent of the global compute capacity. And as manufacturing tolerances grow tighter, analysts expect manufacturers will adopt these technologies in greater numbers as a cost-saving measure.
Taken together, IDC expects the digital economy to account for an ever larger portion of gross domestic product, reaching 41.4 percent by 2025.
“In the future, the digital economy will be the mainstay of economic development and recovery,” the report predicts. ®
This UrIoTNews article is syndicated fromGoogle News