A new Big Data technology and services study from International Data Corporation (IDC) forecasts that the Western European Big Data market will grow by a compound annual growth rate (CAGR) of 24.6 % between now and 2018.
The study says Western European organizations are catching up rapidly with their North American peers in terms of analytical maturity despite later adoption due to smaller datasets, a challenging economy, skills shortages, and greater privacy concerns.
IDC expects the Big Data technology and services market in Western Europe to grow from $2.3 billion in 2013 to $2.9 billion by the end of 2014 and $6.8 billion in 2018.
»Big Data is no longer just a buzzword, but is considered a serious challenge by European organizations in terms of dealing with ever rising data volumes and extracting value from a range of sources such as sensor inputs, product faults, and customer tweets in real time, while avoiding administration and energy costs spiraling out of control,« said Andreas Olah, research analyst, IDC EMEA Enterprise Server Group.
The Big Data market comprises three primary segments — Big Data infrastructure (including servers, storage, and networking), software, and services. The storage segment accounts for the largest part on the infrastructure side with a market size of $536 million in 2013 in Western Europe, followed by the server segment ($314 million). However, the largest overall segment that is included in IDC’s Big Data market sizing is the software side ($698 million), while services also play a significant role ($593 million).
Growth in individual market segments within Big Data varies from storage at a CAGR of 30.5 % to software and services (both at 21.9 %). From a country perspective, CAGRs range between 22.3 % and 32.2 %, and adoption rates depend on a range of factors including existing maturity of analytics, the macroeconomic situation, and the presence of larger organizations, particularly in the retail and financial sectors. The U.K., Benelux, and Nordics tend to show higher initial adoption, though Germany and France are catching up rapidly, while southern Europe still lags behind.
Big Data and analytics allow organizations to improve the quality of decision making at the operational, tactical, and strategic levels to ultimately improve organizational performance. IDC research shows a correlation between greater use of analytics and better organizational performance. However, the increase in complexity as business analytics evolves into Big Data means that gaining value from information is a significant and growing challenge.
»Value from Big Data is far from guaranteed,« said Alys Woodward, research director for European Big Data & Analytics and Worldwide Advanced & Predictive Analytics, IDC. »This is why IDC advises vendors in this space to help their customers understand how to meet their own specific requirements for Big Data to support business priorities, and to build and implement Big Data systems with this in mind.«
IDC expects technology and business process innovation across the software, infrastructure, and services segments to continue as vendors learn from their leading-edge customers how best to articulate value gained from their Big Data projects. IT vendors from areas as diverse as business analytics, data integration, complex event processing, databases (relational and NoSQL), storage, and services will continue to invest in products that address Big Data market demands, while Hadoop related investments will focus on the provision of services.
The smaller independent Big Data vendors are moving more strongly into Europe, and these will help drive the use of Big Data beyond large enterprises. In addition, a lot of demand is expected to come from the public sector as governments aim to achieve cost savings through process efficiencies gained from Big Data analytics, while also improving their analytics capabilities for threat prevention, which can be controversial in some cases where privacy concerns arise, and could act as a major inhibitor for stronger growth.
Recent EU regulations call into question data usage and ownership issues — the legal principle of the »right to be forgotten« goes to the very heart of a company’s ability to mine even anonymized data, which could negatively impact the value of collecting certain data if a company is not allowed to use it via Big Data tools for business purposes.
The study — Western Europe Big Data Technology and Services 2011–2013 Market Size and 2014–2018 Forecast by Country and Segment (IDC #BB01W, August 2014) — is available to purchase on idc.com.