By Angus Loten
Companies are expected to raise spending over the next few years
on technology designed to power data-processing tools installed
directly on factory-floor machinery, cellphone towers, train-track
signals or store-checkout hardware -- instead of in a data
center.
The goal of edge computing is to improve the performance of
production and service applications by processing data where it is
being generated and apply it at lightning speed. The rapid growth
of edge computing across industries comes as digitized functions
and processes spew massive amounts of data, which is increasingly
stored and processes in the cloud, analysts say.
Software company Red Hat Inc., an affiliate of International
Business Machines Corp., last week launched an edge-computing
platform designed to operate across multiple cloud services.
"With so much data, we have to get it closer to where it's
needed," Red Hat Chief Executive Paul Cormier said. "You can't
always take the time on a factory floor to push all that data down
the line; you need it right on the production line to make very
quick decisions," he said.
Companies world-wide are on pace to spend $240.6 billion on edge
computing through 2024, investing in hardware, software and
services, at a compound annual growth rate of more than 15%,
according to the latest forecast by tech industry research firm
International Data Corp.
Beyond big data, the race to install edge capabilities is also
accelerating alongside the growth of the Internet of Things, a
network of connected equipment and other devices used in
manufacturing or retail sales, among other sectors.
Industrial giants such as General Electric Co., Siemens AG and
Robert Bosch GmbH are using edge-computing technology to optimize
production-line machines in real time. Typically powered by
artificial intelligence, edge-computing systems parse production
data at the source and make tiny near-instantaneous tweaks, such as
adjusting the electrical current load in welding robots or the
force applied by a machine press.
Likewise, energy companies have used edge tools to improve
analysis at oil-and-gas wells, and retailers have applied it to
enhance remote checkout services.
"Like the cloud before it, edge is fueling the next wave of
innovation, enabling organizations to automate operations, create
rich customer experiences, and bring new products and services to
market," said Dave McCarthy, IDC's vice president of cloud and edge
Infrastructure services.
Mr. McCarthy said the spending trend offers a fertile area of
growth for cloud-service providers, such as Amazon.com Inc.'s
Amazon Web Services, Microsoft Corp.'s Azure and Alphabet Inc.'s
Google Cloud -- all of which have unveiled edge-computing tools in
recent years: "By extending their cloud platforms to distributed
edge locations, cloud service providers can address a wider set of
use cases than previously possible," he said.
Alstom SA, a France-based rail transportation manufacturer that
provides signaling for major North American railway routes, says it
plans to boost spending on edge computing in the year ahead.
The company recently installed edge tools developed by Red Hat
in wayside devices alongside tracks, including railway grade
crossings.
Among other functions, the devices exchange real-time data to
route trains via trackside signals, while predicting and flagging
track maintenance needs, without bouncing data back to a core
server, the company says.
"The information synthesized is used to automatically alert
operations and maintenance teams to conditions that may require
attention," said Emilio Barcelos, product manager at Alstom who
covers wayside intelligence and analytics. He added that the aim of
its edge strategy is to improve safety and efficiency.
"About half of our clients doing edge are doing it for the
bottom line -- automate, reduce costs, improve efficiency," said
Thomas Bittman, distinguished research vice president at
information-technology research and consulting firm Gartner Inc.
The other half, he added, are looking to leverage edge technology
for new revenue opportunities. The second half is growing the
fastest, he said.
Mr. Bittman said most companies are applying edge computing to
areas in which a real-time response is required, where a lot of
data is being generated and cannot easily or cheaply be transferred
back and forth, or for semi-automated functions. Many are
approaching edge computing as an extension of their cloud
strategies, he added.
Gartner expects companies world-wide to spend roughly $332
billion on cloud services by the end of the year, up from $270
billion in 2020, or about 23%.
Write to Angus Loten at angus.loten@wsj.com
(END) Dow Jones Newswires
May 03, 2021 18:34 ET (22:34 GMT)
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