Big data and analytics solutions for businesses are on the minds of top executives as the global market prepares for revenue to hit $150.8 billion this year, according to data IDC released today.
According to IDC’s Worldwide Semiannual Big Data and Analytics Spending Guide, this would represent a 12.4 percent revenue bump from 2016.
The analyst firm expects the U.S. to be the top spender at $78.8 billion, followed by Western Europe at $34.1 billion.
IDC also predicted that commercial purchases of big data and analytics hardware, software and services would grow at a CAGR of 11.9 percent through 2020 and surpass $210 billion.
“After years of traversing the adoption S-curve, big data and business analytics solutions have finally hit mainstream,” Dan Vesset, group VP of analytics and information management at IDC, said in a statement. “Big data and business analytics as an enabler of decision support and decision automation is now firmly on the radar of top executives. This category of solutions is also one of the key pillars of enabling digital transformation efforts across industries and business processes globally.”
Not surprisingly, IDC expects IT and business services will lead in technology investments this year, pegging its market share at over 50 percent.
The analyst predicts spending related to services will grow the fastest, with a five-year CAGR of 14.4 percent.
Meanwhile, software revenue will surpass $70 billion come 2020, primarily thanks to end-user query, reporting and analysis tools and data warehouse management tools, IDC said in its announcement.
Non-relational analytic data store and cognitive software platform will enjoy “strong growth”, with CAGRs of 38.6 percent and 23.3 percent, respectively, IDC noted.
In addition, server and storage purchases related to analytics will grow at a CAGR of nine percent to hit $29.6 billion in 2020, IDC predicts.
Channel partners wondering where to place their bets for the futuremay consider the banking, discrete manufacturing, process manufacturing, federal/central government and professional services industries, which IDC expects to be top spenders this year. It predicts the markets will spend $72.4 billion on big data and analytics solutions in 2017, before continuing dominance in 2020 by spending $101.5 billion.
Meanwhile, the financial services sector, as well as telecommunications (CAGRs of 13.3 percent and 12.8 percent, respectively) and the media may also be ones to watch.
“The three industries that comprise the financial services sector – banking, insurance and securities and investment services – all show great promise for future spending on big data and business analytics,” Jessica Goepfert, program director of customer insights and analysis at IDC, said in a statement. “This technology can be applied across key use cases throughout these financial institutions from fraud detection and risk management to enhancing and optimizing the customer’s journey,” the exec noted.
Goepfert added that outside of financial services, several other industries present “compelling” opportunities.
“Within telecommunications, for instance, big data and analytics are applied to help retain and gain new customers, as well as for network capacity planning and optimization,” she said. “Meanwhile, the media industry has been plagued by massive disruption in recent years, thanks to the digitization and massive consumption of content. Here, big data and analytics can help firms make sense of and monitor their readers’ habits, preferences and sentiment. Vendors targeting the big data and analytics opportunity would be well-served to craft their messages around these industry priorities, pain points and use cases,” Goepfert advised.
Size matters when it comes to big data and analytics spending, according to IDC, which said businesses with over 1,000 employees will represent over 60 percent of big data and analytics spending throughout its forecast.
SMBs with fewer than 500 workers will represent almost 25 percent of global spending, IDC noted.