The business intelligence (BI) software market will reach $13.8 billion in revenue worldwide in 2013, up 7 percent from last year, and is projected to climb to just over $17 billion by 2016, according to a report by IT research firm Gartner.
However, compared with 2011 growth of 16 percent, 2013 and the coming years are expected to be slower, with growth in the high single digits. The report cautioned growth would be hampered by sluggish macro indicators, as well as by slowing sales cycles of multimillion-dollar, end-to-end BI deals.
Enabled by Gartner’s “Nexus of Forces” (cloud computing, mobile technology, social media and information), CIO appetite for BI will be complemented by more tactical buying in business units for departmental and workgroup analysis, as well as for personal BI, the report said.
"BI and analytics have grown to become the fourth-largest application software segment as end users continue to prioritize BI and information-centric projects and spending to improve decision making and analysis," Gartner principal research analyst Dan Sommer said in a statement. "As more and more information is generated, business models need reinvention, and it's increasingly clear that mastering analytics on big data will be a key driver for the next economic cycle."
While the current business model is largely "build" driven, in that organizations license software capabilities to build analytic applications, the emerging data-as-a-service trend could significantly grow the market for BI and analytics platforms, the report noted.
In time, most companies, regardless of their business model, will need to provide a data-as-a-service offering, giving this trend the potential to grow the market considerably as a range of vendors look to embed a BI and analytic platform provider's software capabilities into their data-as-a-service offerings. Gartner analysts predicted organizations would increasingly subscribe to industry-specific data services that bundle a narrow set of data with BI and analytic capabilities embedded.
"Although this is a mature market and has been a top CIO priority for years, there is still a lot of unmet demand. Every company has numerous subject areas — such as HR, marketing, social and so on — that have yet to even start with BI and analytics," Gartner research vice president Kurt Schlegel said in a statement. "The descriptive analytics have largely been completed for most large companies in traditional subject areas, such as finance and sales, but there is still a lot of growth expected for diagnostic, predictive and prescriptive deployments. Since many midsize enterprises have yet to even start their BI and analytic initiatives, we expect the market for BI and analytics platforms will remain one of the fastest-growing software markets."