Are the big data market growth projections realistic?

Big data market projections are not realistic

Are the big data market growth projections realistic?

Are the big data market projected growth rates aggressive? Recent evidence is inconclusive. If we look at 2013 performance, key business intelligence vendors registered a cumulative software market growth of approx. 7-8%. Picture this in contrast to the 20-30% annual growth rate projected for big data market over the next half a decade by most analysts/firms. One has to be mindful of the fact that big data is still considered to be a nascent segment (approx. 10%) of the overall business intelligence market. Also, big data is still witnessing an exploratory phase of evolution. Having said that, BI too, is on a game-changing transformational path and it is mostly the top BI players, who are most active in the big data segment. In the 2013 numbers published by Gartner, the Advanced Analytics segment, which is practically the next best indicator to the big data segment, also underperformed the projections by registering an annual growth rate of 12.5%.

Let us look below at some of the comparative projections that are available on the big data market. A fundamental difference in the market these publishers have recorded for 2014. Mostly, big data market refers to big data hardware, software, technology and services market segments. From an evaluator perspective, it is important to factor in that in most of the cases, investments in servers, storage and networking will not be exclusively for big data. I believe majority of the differences in market value arise from these granular differences in assumptions made for defining big data market. From the table below, Wikibon market estimates can be considered to be of highest accuracy as it maps its market by looking at both major-IT-players as well as pure-play big data players. However, in the past, its growth rate projections have been relatively very aggressive (projected a 61% growth rate in 2011). A consensus on growth numbers for the next five years would suggest that the market will grew annually in double digits percentage, approx. around 15-20%. Compared to Wikibon, IDC market numbers are lower perhaps because its categorization of market segments misses out on some segments on cloud-based big data market infrastructure, software, analytics and services.

  2014 2015 2016 2017 2018 2019 CAGR %
AT Kearney 39.9 51.9 67.5 87.7 114.0 148.2 30.0
Signal & Systems Telecom 30.0 35.1 41.1 48.1 56.2 65.8 17.0
Wikibon 28.5 38.4 45.3 50.1 55.4 61.2 15.2
IDC 16.4 20.7 26.1 32.9 41.5 52.4 18.6

Interestingly, Gartner predicted that the cumulative big data spending between 2011 and 2016 will be $232b. Using a 20% CAGR, this would suggest a market of $40.4b in 2014 and $58.2b in 2016.

Now let us look at some other projections on the market that cover some of the other related market segments.

2014 2015 2016 2017 2018 2019 CAGR %
Gartner Business Intelligence Software Market 14.8 15.9 17.1 18.4 19.7 21.2 7.4%
Wikibon Big Data Software Market* 6.8 9.0 12.0 16.0 21.3 28.4 33.2%

*includes Infrastructure Software, SQL, NoSQL, Apps and Analytics

Some analysts say that big data software is still a lowly 10% of overall BI software market. I do not agree with that number. I think this number is more close to 20%. The future of business intelligence software hinges on big data and in some time, there is a strong likelihood of these two markets converging.

There is not much disparity between forecasts on cloud-based business intelligence from Wikibon and Redwood Capital.

2014 2015 2016 2017 2018 2019 CAGR %
Wikibon Big Data Cloud Market 1.82 2.52 3.05 3.65 4.83 6.39 32.3%
RedWood Capital Big Intelligence Cloud Market 0.98 1.29 1.69 2.21 2.94 3.85 31.3%

 

There is however, a strong disparity between market projections for big data as a service from Wikibon and EMC. Clearly, EMC numbers are not reliable as consensus suggests that service is at least approx. 15% of the total big data market.

2014 2015 2016 2017 2018 2019 CAGR %
EMC Big Data as a Service 1.69 2.55 3.85 5.80 8.75 13.19 50.8%
Wikibon Big Data Professional Services 10.1 13.5 16.0 17.2 22.2 28.8 29.3%

 

Anubhav is a data scientist who works and writes on new big data decision sciences models and their application in key business areas across industries. Anubhav also tracks the industry developments. He can be reached at anubhav@thinkbigdata.in

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