As wireless operators begin lighting up next-generation 5G networks, the combination of faster mobile broadband speeds coupled with massive modern data loads is expected to drive an emerging technology: edge computing.

Edge computing aims to make data processing more efficient by cutting down on the distance that information must travel. The major U.S. wireless carriers are all testing edge processing platforms to compete for this next wave of computing, with demand driven by increased data consumption as consumers, businesses and municipalities embrace a growing number of connected devices, and the internet of things expands.

Hewlett Packard Enterprise Co. estimates that as much as 75% of enterprise data will be generated and processed at the edge by 2025, Gerald Kleyn, vice president of edge and IoT at HP, said in an interview. The company has committed to a $4 billion investment in edge technologies over the next four years.

"I view [edge computing] as a greenfield opportunity, much as the cloud was a greenfield opportunity 15 years ago," Kleyn said.

Moving to the edge

While cloud computing's central processing servers opened up new possibilities for data storage, edge computing brings more processing power closer to where the data is generated. Some edge computing applications are already in use, but the rise of faster 5G mobile networks and the ability to put more computing power in smaller and smaller microchips are expected to ramp up demand for edge computing.

"Mobility is the glue that will hold [edge computing] together," said Christina Cheng, AT&T Inc. assistant vice president of enterprise mobility solutions, in an interview. AT&T found that moving data processing from the cloud to a local edge network using 5G wireless broadband can decrease latency by 10x, from 60 milliseconds to 6 milliseconds in one test, Cheng noted.

AT&T began rolling out an edge-computing platform to enterprise customers in a pilot in June. The company partnered with HP to develop the new service.

Other mobile providers are investing in mobile edge networks. Verizon Communications Inc. is testing its own edge-computing service, though it has yet to launch. The company has done as many as 20 demos of its multi-access edge computing platforms in development, Chief Technology Officer Kyle Malady said during a June investor event. One recent test supported a smart-city initiative to augment AMBER alert warnings with image capture to locate potential kidnap victims in real time.

Such enterprise and smart-city applications are expected to add to the already growing amount of video traveling over mobile networks.

Measuring market appeal

"I think the edge in many ways will see faster adoption … than cloud did because the data has already been generated and companies are trying to figure out how to use that to make operations more efficient," said Matt Kimball, senior analyst at Moor Insights and Strategies, in an interview.

Microchip manufacturer ARM Holdings PLC estimates that by 2035, the edge-focused IoT industry will crest $1 trillion in spending, driven by the growth in new IoT devices.

The rise of edge computing will not directly threaten existing cloud providers like Amazon.com Inc., Microsoft Corp. and Alphabet Inc., experts agreed. Rather, edge computing is expected to develop alongside the cloud as an option for processing large amounts of data from local devices.

"The cloud isn't going away, and the data centers aren't going away," HP's Kleyn said. "It just can't all possibly go back to the cloud."