The market for Big Data technology and services will grow at a compound annual growth rate (CAGR) of 23 percent through 2019, according to a forecast issued by research firm International Data Corp. (IDC) on Monday. IDC predicts annual spending will reach $48.6 billion in 2019.
IDC divides the Big Data market into three major submarkets: infrastructure, software and services. The research firm expects all three submarkets to grow over the next five years, with software — information management, discovery and analytics and applications software — leading the charge with a CAGR of 26 percent.
IDC predicts services, including professional and support services for infrastructure and software, will grow at a CAGR of 22.7 per cent. It forecasts that infrastructure — consisting of computing, networking, storage infrastructure and other datacentre infrastructure-like security — will grow at a CAGR of 21.7 per cent and will account for roughly half of all spending through 2019.
The biggest verticals
IDC says the discrete manufacturing vertical spends the most on Big Data ($US2.1 billion in 2014), followed by banking ($US1.8 billion in 2014) and process manufacturing ($US1.5 billion in 2014). The industries with the fastest growth rates include securities and investment services (26 per cent CAGR), banking (26 per cent CAGR) and media (25 per cent CAGR).
[ Related: Why big data will be a big deal for the new HP ]
"The ever-increasing appetite of businesses to embrace emerging big data-related software and infrastructure technologies while keeping the implementation costs low has led to the creation of a rich ecosystem of new and incumbent suppliers," Ashish Nadkarni, program director, Enterprise Servers and Storage, IDC, said in a statement. "At the same time, the market opportunity is spurring new investments and M&A activity as incumbent suppliers seek to maintain their relevance by developing comprehensive solutions and new go-to-market paths."
Nadkarni, together with Dan Vesset, program vice president, Business Analytics & Big Data, IDC, coauthored the IDC study, Worldwide Big Data Technology and Services Forecast, 2015-2019, which predicts that as big data matures, it will continue to increase its share of the larger business analytics market, even as year-over-year growth begins to slow slightly as a result of that maturity.
Nakkarni and Vesset say that eventual reduction in overall growth will largely be caused by increased price pressures for infrastructure and higher rates of commercialization of open source software. They also note that the availability and skill level of big data IT and analytics talent will also have an effect.
Rewards and risks
"The ability to leverage big data and analytics to develop an integrated view of customer activities and business operations will provide competitive differentiation to companies across industries," Jessica, Goepfert, program director for IDC's Global Technology and Industry Research OrganiSation, said in a statement Monday. "However, in addition to the huge opportunities, big data presents some significant risks and liabilities to organizations. Line of business and IT executives will need to approach these ongoing challenges with awareness, flexibility, adaptability and responsibility."
Join the CIO New Zealand group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.