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A new update to the Worldwide Semiannual Mobility Spending Guide from IDC forecasts that European mobility revenues are expected to reach $224,8-billion in 2017, with a marginal increase of 0.1% over 2016.
Purchases of mobile hardware, software, and services are expected to grow more stably in 2019 and 2020, achieving a compound annual growth rate (CAGR) of 0.4% over the 2015-2020 forecast period and reaching $230,3-billion in 2020.
Mobile connectivity services currently represent almost 50% of European mobility spending, with consumer counting for more than 73% of this tech category. Hardware, driven by smartphones, follows, taking 42% of the mobility market in 2017, a share expected to decrease to 37% in 2020. Software, although delivering just a tiny portion of the full mobility spending, will be the fastest-growing area, fueled by enterprise mobility management applications and mobile application development platforms, both expected to grow at a 19% 2015-2020 CAGR.
“A majority of European companies are still behind the curve in their adoption of mobility solutions, but we believe 2017 will mark a turning point for many,” says Angela Salmeron, research manager, EMEA Enterprise Mobility, IDC. “Companies will be accelerating their mobile strategies in response to several market forces: on the one hand, the digital economy is forcing companies to innovate and be more agile to market changes; on the other hand, the threat landscape and regulatory compliance, chiefly GDPR, is requiring security to be baked in in the early stages of any mobility initiative rather than being an afterthought.”
Banking, discrete manufacturing, and professional services will drive the European mobility market across commercial industries, counting for more than 35% of spending (excluding consumer) in 2017 and throughout the forecast period. When looking at growth rates, government, followed by utilities, will show the fastest growth with a 2015-2020 CAGR of around 6%. Consumer will be the only industry with negative growth for the coming years (-1.6% 2015-2020 CAGR), negatively impacted by the expected hardware drop.
“Banking, discrete manufacturing, and professional services will continue to be the three leading industries in the European mobility market scenario,” says Andrea Siviero, research manager, European Customer Insights and Analysis. “Banking institutions are strongly expanding their mobility investments beyond employees’ internal usage, and providing customers with a full and best-of-breed mobility experience is now key for organisations in the sector. Discrete manufacturers look with interest at mobility investments in their run toward increased productivity across all business lines. Lastly, mobile solutions answer different needs in the professional services fragmented subsectors, from helping cross-location internal collaboration in consulting to enhancing workers’ productivity in field-service based activities.”
When considering the business (excluding consumer) mobility European market from a company size perspective, very large companies (with more than 1,000 employees) drive market growth (7.4% 2015-2020 CAGR) and will count for almost 37% of the market in 2020. Strong mobility services investments are expected in this size band to provide an enhanced customer experience and improve employees’ collaboration and productivity. On the other side, the SMB sector (fewer than 500 employees) shows much lower growth (1.7% 15-20 CAGR), although its market share will remain largely above 50% across the forecast period.
From a country perspective, the UK is the largest mobility market in terms of revenues, followed by Germany and France. The top 5 European countries (the U.K., France, Germany, Italy, and Spain) currently represent 73% of the mobility market. The Netherlands and Italy are expected to lead market growth in 2017. Nevertheless, when excluding consumer spending, Denmark, followed by the UK, will show the highest 2015-2020 CAGR (6%).