Worldwide spending on big data and business analytics (BDA) solutions is forecast to reach $215,7-billion this year, an increase of 10,1% over 2020, according to a new update to the Worldwide Big Data and Analytics Spending Guide from International Data Corporation (IDC).
The forecast also shows that BDA spending will gain strength over the next five years as the global economy recovers from the Covid-19 pandemic. The compound annual growth rate (CAGR) for global BDA spending over the 2021-2025 forecast period will be 12,8%.
“As executives seek solutions to enable better, faster decisions, we’re seeing relatively healthy BDA spending across all industries. Leveraging data for insights into everything from internal business operations to the customer journey is top of mind and of strategic importance,” says Jessica Goepfert, program vice president: customer insights and analysis at IDC.
“Firms in the professional services industry, for instance, are utilising Big Data and analytics to support their 360-degree customer and client management efforts, as well as advanced project management initiatives. Banks are using BDA solutions to improve customer onboarding while simultaneously automating business operations and detecting and preventing fraud. Even slower moving industries like construction have started to fuel investments in extended supply chain planning and interconnected and collaborative workspaces.”
The industries currently making the largest investments in big data and analytics solutions are banking, discrete manufacturing, and professional services. Combined, these three industries will account for one third of all BDA spending in 2021.
The next three industries – process manufacturing, telecommunications, and federal/central government – will together deliver nearly $47-billion in spending this year. While the telecommunications industry will see the fastest growth in BDA spending over the five-year forecast, all but one of the 19 industries covered in the spending guide are expected to deliver double-digit growth.
Over half of all BDA spending in 2021 will go toward services with IT services accounting for more than $85-billion of the total and business services making up the remainder. The second largest segment of BDA spending this year will be software, which will see investments totaling $82-billion.
Almost half of this total will go to three types of applications – End-User Query, Reporting, and Analysis Tools, Relational Data Warehouses, and Nonrelational Analytic Data Stores – with the remainder spread across the 13 remaining software categories. Software will also be the fastest growing segment of BDA spending with a five-year CAGR of 15,1%.
“Unlike many other areas of the IT services market, big data and analytics services continued to grow in 2020 as organizations relied on data insights and intelligent automation solutions to survive the Covid-19 pandemic,” says Jennifer Hamel, research manager: analytics and intelligent automation services at IDC.
“The next phase of digital resiliency will spur increased investment in services to address both lingering and new challenges related to enterprise intelligence initiatives.”
On a geographic basis, the United States is the largest market with more than $110-billion in BDA spending this year. Japan and China are the next two largest markets with BDA spending forecast to reach $12,4-billion and $11,9-billion, respectively. The United Kingdom is the only other country expected to surpass $10-billion in BDA spending this year. Argentina is forecast to see the fastest growth in BDA spending over the forecast period with a five-year CAGR of 21,2%. China’s CAGR of 20,1% will enable it to become the second largest market by the end of the forecast.