It might be as difficult to forecast edge computing capital investment as it is to forecast edge computing demand. For starters, there are many different definitions of potential “edge” computing. Edge computing can happen directly on user devices; on a premises using a local data center; someplace three to five miles distant (base of cell tower); within a metro area or hundreds of miles distant.
So a judgment has to be made about how to evaluate the edge computing capex “on device.” Is it the full cost of the appliance or the incremental cost of the AI capability? Do we include software? And is “capex” cost the relevant metric, or do we include the on-going costs of subscriptions, which might better capture the full cost of using AI capabilities?
To be sure, if all we are measuring is capital investment, then software subscriptions are not relevant. But that full cost does matter if we are trying to compare the cost of creating and using remote and edge computing.
The U.S. cloud computing services market was valued at approximately $216.91 billion in 2023 by Grand View Research, with projections indicating growth at a compound annual growth rate (CAGR) of 20 percent from 2024 to 2030. Meanwhile, the revenue from smartphone sales in the United States is projected to be around $109.8 billion in 2024.
If edge computing revenue grows, that should also imply that capex grows. The other issue is that we normally only measure “capex” on the producer side of a market. Consumer expenditures on computing gear, including smartphones, are not counted as “capex.”
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