ABI Research, a global technology intelligence firm, expects the global CDN market to more than double by 2030, reaching US$23.9 billion. This growth is driven in part by expanding presence in services beyond core content delivery and caching, which includes security (network, content, and enterprise) and edge compute. These newer areas are supported by current trends like direct-to-consumer streaming, hybrid workforces, and migrations to the cloud. Further, the buildup to the metaverse will create additional growth opportunity for CDN providers at the network edge, particularly in the latter half of this decade and beyond.
Michael Inouye, Principal Analyst, Metaverse Markets and Technologies, at ABI Research explains, "The metaverse has received quite a lot of attention recently, and while this longer-term vision is certainly exciting, even with the uncertainties, more attention needs to be devoted to the buildup towards this future. One critical milestone in the buildup to the metaverse will be the arrival of consumer-friendly smart glasses, which will push more user applications and content closer to the edge, fueling growth opportunities for CDN providers."
Smart glasses create an always on user experience that pushes experiences into the public domain, which increases demands on mobile networks and need for lower latency services. The network edge will develop to meet these demands across a range of ultra-low latency (all sub 1 second) needs that span from cloud XR and compute, real-time communications, and personalization. Personalization, in particular, represents a key market opportunity for CDN providers in the coming years when the metaverse and smart glasses vastly expand the number of touchpoints for applications, content, and services.
"In some regards calling the collection of companies covered in this report, CDN companies is a misnomer. Companies that offer CDN services represent a diverse group, with large incumbents with extensive product portfolios like Akamai to smaller companies focused on agility and innovation like Cloudflare who have already brushed off the CDN moniker and are already offering some services more akin to the cloud platforms like AWS, Google, Microsoft Azure, Tencent, Alibaba, Huawei Cloud, etc. who also offer CDN services," Inouye clarifies. The demand for edge resources is also generating opportunities for new market developments like Open Caching from the Streaming Video Alliance, which creates additional value for ISPs' private CDNs and brings additional business to companies like ATEME, Broadpeak, and QWILT.
"As the value of personalization grows and media workflows become more expansive, we expect a greater shift within the more traditional CDN players to follow companies like Limelight Networks which recently announced its acquisition of Edgecast, an early leader in bringing these pieces together under one roof. Steps like this represent another way CDN companies will move closer to the larger cloud companies. The metaverse is still far off but a lot must happen between now and then and the buildup to this future will create opportunities to generate significant market value," Inouye concludes.
These findings are from ABI Research's CDN Market Evolutions and the Path to the Metaverse application analysis report. This report is part of the company's Metaverse Markets & Technologies research service, which includes research, data, and ABI Insights. Application Analysis reports present in-depth analysis on key market trends and factors for a specific technology.