Will RedCap supercharge the demand for edge data centers?
The arrival of 5G RedCap (reduced capacity) could add further incentive to deploy data center resources at the edge. RedCap was originally introduced in 3GPP Release 17, targeted at constrained devices that currently rely on LTE Cat-4 or other legacy connections. While full-blown 5G includes a ton of advanced features, it’s overkill for many edge devices, and those features come at a cost.
While RedCap has not yet been approved (it’s expected to be approved sometime this year), pre-standard RedCap gear is already starting to hit the market, with AT&T, Ericsson, and Nokia, among others, already testing RedCap-compatible gear. (See also: Will RedCap 5G spark IoT gold rush?)
RedCap offers better peak data rates, broader coverage, and lower latency versus 4G LTE and especially 3G, which is still prominent in many parts of the world. It is also designed to accommodate constrained devices with simpler radio designs and lower power consumption needs. According to research from Ericsson, relying on RedCap (vs. 5G) could bring the cost of IoT devices down by 65%.
Another advantage of RedCap is that it could help unify connectivity at the edge and beyond. “Today, we almost have too many ways to connect,” said Jason Leigh, Research Manager, 5G & Mobility Research for IDC. “WiFi, LPWAN, Bluetooth, LTE, 5G, and so on. What’s the right connectivity option and when?”
Many devices do just fine with 4G and even 3G, but they aren’t robust enough to shoulder the added cost of full 5G support. With 3G already sunsetted in the U.S., vendors are hoping that RedCap will change that equation, pulling laggards along. “RedCap could help consolidate connectivity, serving as an on-ramp to an eventual all 5G world,” Leigh said.
Early movers gain the edge
In Japan, the 5G-edge data center connection is already underway. The country’s first ISP, IIJ (Internet Initiative Japan), has deployed edge data centers to help it deliver end-to-end 5G services. IIJ was having difficulty providing end-to-end 5G services because relying on centralized data centers created coverage gaps. End-to-end 5G necessitates the deployment of infrastructure near 5G antennas, but many antenna sites are impractical for full-blown data centers because they are in a remote location or located on a constrained site, like on a rooftop.
This means that traffic must travel back to central data centers or infrastructure must be deployed at the edge in smaller-footprint data center packages. IIJ started building a hybrid 5G-MEC (Mobile Edge Computing) network based on hardware from Zella DC, an Australian edge-data-center provider. 5G-MEC now provides the connectivity and infrastructure that IIJ says will enable applications that require low-latency, reliable communications, including use cases in telemedicine, smart factories, and even AgTech.
In Australia, Afterpay, a global fintech company, was expanding so rapidly that they needed to scale their data center infrastructure to keep pace. The company provides a buy-now, pay-later payment platform that relies on a proprietary decision-making engine to determine credit worthiness of retail customers in near real time. As the business scaled up, Afterpay worked with Digital Realty to deploy edge computing services to support approximately 450 employees located around the globe with the low-latency, high-availability connectivity needed to process more than 2 billion transactions annually.
In China, the operators of the Pingtan Strait Bridge are deploying an edge data center from Vertiv to manage intelligent infrastructure. The bridge is a 10-mile, two-layer span designed as a six-lane expressway on the top layer with a two-track Grade I railway on the lower layer. Because this is a cross-sea, dual-use bridge, operators must contend with issues such as strong winds and waves, meaning constant monitoring is a must. The Pingtan Strait Bridge project deployed Vertiv’s Smart Aisle edge data center to help it monitor conditions, manage bridge operations, and automate things like an intelligent gate system.
The edge data center market is still in its early stages, but with tailwinds that include high-growth technologies like AI, IoT, and 5G, this market should continue on a fast-growth trajectory for the foreseeable future.
