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What’s Really Driving Edge Data Center Market Increases (Hint: It’s Not 5G)


The edge data center market is projected to grow by 23% over the next 6 years, but what is driving the trend? Compass Data Center’s Keith Rutledge discusses the true driver behind increased demand for edge data centers and why industries need to jump on board now. 

There’s a lot of talk about 5G driving demand for edge data centers. But we look at things a little differently at Compass. To us, it’s actually the applications that require a low-latency connection for full functionality at the forefront of this evolution. Applications are the cart that goes before the horse…the horse being edge data centers connected with 5G reigns.  

The Growing Importance of Edge Computing

Edge data centers are uniquely able to deliver scalable computing power, reduced latency and data security at a cost that’s more accessible than a full-scale data center. Edge centers can be installed and operating in a matter of weeks to bring the network closer to the end user users. To the extent there is demand for high horsepower applications, businesses will find ways to earn a return on delivering those capabilities.

Opportunities to monetize

Reframing the edge conversation to look at applications as the drivers and 5G and edge data centers as enablers, there are endless opportunities. There will be as many different implementations of the edge as there are types of buildings and businesses. Some of the verticals likely to be early movers thereby reaping financial rewards from their investment edge centers are:  

  • Manufacturing. IOT devices, artificial intelligence, robotics, milling machines and other applications will drive growth in edge centers to support manufacturing. Advanced automation requires incredible compute capacity. The return on investment comes through ability to scale and enhance production, lessen waste and error, and reduce labor costs.
  • Commercial real estate. Edge centers make it possible for building owners to offer tenants access to enhanced connectivity to support data hosting, faster processing, greater reliability and privacy, and provide the power to run (increasingly) smart buildings.  
  • Residential. Smart homes are quickly becoming a multibillion-dollar industry but what happens when the internet is down? You can’t turn on your lights, control your thermostat or — heaven forbid — watch movies or games. Residential developers offering dedicated hosting in resilient structures with uninterruptible power are creating a unique selling proposition.

According to a report by the National Multifamily Housing Council, high-speed internet is the second-most important feature renters look for when they’re considering a new home, after only air conditioning. 93 percent of renters want high-speed internet access, and 63 percent say they’d refuse to rent an apartment without it. Exceptional, gigabit-capable internet has been proven to increase a building’s profitability. Low latency can increase rental value by 8%, which leads to an 11% net income gain.

Secure connectivity, close to the point of use, means manufacturing lines work more reliably and autonomously, a smart home will be up and running 24×7, and your tenants or residents can keep their internet-dependent applications up and running securely and at peak efficiency.

5G and Edge Computing: A Catalyst for Next-Generation Innovation

The train has left the station. With the enablers expanding at a rapid clip – 5g connectivity and Edge data centers – it seems we’re on the cusp of seeing tremendous growth in next generation, bandwidth-intensive applications.  No one expects this trend to go away or lessen. If anything, newer, better and more bandwidth-intensive applications will arise. As ingenuity exceeds the limitations of our imaginations, the proliferation of edge data centers will provide the home for the future waves of applications. 

In a future blog, I’ll talk about how the next generation of antenna’s (really more than just antenna’s) will work together with edge datacenters to deliver twenty-first century computing services.  5G with its arrays of antennas and multiple frequency spectrums will combine with edge datacenters to make ubiquitous high-speed wireless connectivity practical.  

1 High-speed internet can boost your building’s bottom line  and your bank account 02/06/20


Keith Rutledge

General Manager

Keith Rutledge General Manager for Edgepoint at Compass Datacenters. Compass Datacenters Edgepoint is a zero touch Edge datacenter solution at scale. Keith is responsible for client engagements for Edgepoint.

In a long career at IBM, Keith was a printed circuit board designer, a software developer, a product manager, and a sales executive. As a product manager, Keith wrote The Business Case for Java and edited The Business Case for eBusiness. He ran Central Europe Middle East and Africa for IBM’s AS/400 product and was Worldwide Director of Sales for the AS/400. Keith led a strategic outsourcing practice in China for IBM. At Sirius, Keith was responsible for partners and routes to market before becoming Director of Sales and General Manager for Sirius Southeast.

He also had a long military career in Special Forces, retiring in 1999 as a Team Sergeant from 19th Special Forces Group.