Cloud Computing vs. Edge Computing: Which Is Best for Your Business?
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Aron Wagner
Posted: Aug 2, 2023, 1:26 PM

Digital data is growing at a phenomenal rate!

The International Data Corporation (IDC) predicts that worldwide data will grow at an annual rate of 61%  to 175 zettabytes by 2025. To put that in perspective, a zettabyte is equivalent to 1,000 exabytes, while one exabyte is equal to a billion gigabytes.

Businesses thrive on this data to leverage valuable insights and optimize their decision-making processes. The type of computing environment a business uses determines requirements around data storage needs, latency, and processing power, among other things. Naturally, businesses must choose a computing environment in keeping with their service requirements and the nature and confidentiality of the data at stake.

Cloud computing and edge computing are data network environments that serve distinctive needs and are often utilized in complement to each other. There is an urgent need for businesses to understand the features and implications of each computing environment to make the right choice between the two.

Let’s understand these two computing environments in more detail.

Cloud Computing and Edge Computing – Unraveling Their Respective Strengths:

Both cloud and edge paradigms have their distinct functionalities.

Edge computing is an infrastructure environment that moves computing closer to end-users, devices, and data centers. In contrast, the traditional model of cloud computing works to centralize the processing of tasks through remote, third-party hosted server architecture, such as those deployed by major cloud service providers like AWS, Alibaba, and Microsoft Azure.

Cloud Computing

The market size of the cloud computing industry stood at over $545 billion in 2022 and is expected to expand at a CAGR of over 14% from 2023 to 2030. Cloud provider services have helped businesses benefit from faster innovation, increased collaboration, and hyperscaling of their commercial activities. It has three main types:

  • Public clouds
  • Private clouds
  • Hybrid clouds

Here are some noteworthy strengths of cloud computing:

  • Business Scalability - Cloud technology allows companies to rapidly expand without worrying about data storage issues or geographical location. It enhances computing flexibility by adjusting cloud storage according to business needs, scaling up and down as required.
  • Cost-saving - Cloud computing helps companies save on capital investment by offloading infrastructure costs to a third-party cloud service provider. Companies benefit from cutting down on upfront hardware expenses and overhead maintenance costs.
  • Mobility and Accessibility - Cloud applications can be used anywhere and anytime with a simple internet connection. This non-confinement of data has led to an evolution of the workplace and rapid expansion of collaborative environments through remote access.
  • Unlimited Storage - Cloud computing lets you store, access, and retrieve data easily. High storage capacities mean users can share and access files remotely whenever necessary.

Although every business may not require cloud computing services, it remains a key driver of competitive enterprises.

Edge Computing

Edge technologies have their own use cases and advantages.  Its market size is valued at over $13.50 billion in 2023. Edge computing is set to make a boom with the emergence of 5G, the Internet of Things (IoT), and AI-enabled technologies relying on real-time data handling.  Here are some of its key benefits:

  1. Latency Reduction - Moving the compute point closer to the origin of data allows for latency reduction. Edge computing lowers response time by eliminating the need to move data from endpoints to a centralized cloud system. This is a critical consideration for the deployment of many technologies.
  2. Real-time analysis of data - Companies benefit from cutting down on lag time and improving real-time handling of data to improve quick decision-making. For instance, autonomous vehicles and image processing in medical use cases require instantaneous movement of data to function safely. Every microsecond counts.
  3. Better for Compliance - Gathering, storing, and using customer data is increasingly subject to data privacy regulations today. Data breaches are costly, with the stakes varying according to the nature and sensitivity of the data. Edge computing makes compliance easier by storing data locally and ensuring data sovereignty.
  4. Improved Security - Enterprises can minimize security risks by staying in an offline computing environment instead of data transmission over the internet. When edge computing is hosted on-premise by the customer, there is a considerably lower risk of data theft.

Edge versus Cloud: Emerging Industry Trends

While cloud computing continues to make rapid strides, edge computing has gained quite some traction too in recent years. This is due in part to maturing bandwidth speeds that make it efficient and reliable.

  • Edge has gained remarkable prowess in the fields of augmented reality (AR) and the Internet of Things (IoT), which together allow for immersive and personalized experiences to be delivered.
  • IoT in healthcare has become a key driver of edge computing, with many use cases such as real-time monitoring of temperatures for cold-storage supply chains for vaccines and other medical amenities. At-home IoT medical equipment also helps in serving patients better by tracking vital signs and other health metrics.
  • Another area of application for edge computing is autonomous vehicles, which require real-time data with little margin for error. With them, it is crucial to correctly interpret traffic signals, obstacles, and road conditions for live instructions to the vehicle. Edge computing offers low latency and saves up on network bandwidth to ensure smooth data processing at source.

Cloud computing, for its part, offers unique points of strength. It has become a standard for storing and managing data. Streamlined cloud storage allows users to access files at any point at the tip of their fingers.  For users, this means easier backup options in case of electronic failures or disaster recovery.

  • Quick access to large swathes of centralized data is also driving AI/ML-based enterprises to take stock of cloud services, with emerging uses in finance, energy, and retail, among others.
  • Cloud provides large-scale data storage and computing resources that can digest high-volume, high-velocity streaming data to be acquired and studied later. Such capabilities are beyond the onsite IT capabilities of most businesses and hence allow for high levels of innovation under data-driven economies.
  • Google and Microsoft enable team collaboration with services such as Microsoft Teams, Microsoft SharePoint, Google Hangouts, and Google Drive. Microsoft Teams recently launched LiveShare to go beyond passive screen sharing and enable participants to co-watch, co-edit, and co-create in Teams meetings.

Cloud collaboration has driven productivity and given employees tools and software for greater participation and teamwork.

A Hybrid Future: Mixed Approaches

Business decisions about edge or cloud computing are unlikely to be binary. That means businesses are unlikely to have either just cloud or just edge capabilities, but a mix of the two.

The circular nature of both technologies means they are not mutually exclusive, but quite the opposite. Cloud computing brings data together to provide analytical insights, which in turn get distributed over edge networks. There is wide scope to develop efficient synergies between the two to meet emerging business needs.

The right combination of cloud and edge technologies is key to maximizing security, cost-efficiency, and revenue growth.

American Cloud is at your service

American Cloud is an innovative cloud services provider focused on enhancing business agility and productivity.

We offer multi-service cloud options ranging from web hosting and SasS to mobile app development - all of them in reliable and cost-effective options.

Get in touch with American Cloud today to find out more.