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Gartner: BI software spending to hit $17.1 billion by 2016, but pace of growth slowing

A still-soft economy and other factors will temper BI spending compared to past years

The global market for BI (business intelligence) software will hit US$13.8 billion in 2013, but the pace of growth will be slower than in past years, according to new figures from analyst firm Gartner.

This year, BI market spending will rise by 7 percent, compared to a 16 percent uptick in 2011, Gartner said. Total spending will rise to $17.1 billion by 2016, the report adds.

"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," Gartner analyst Dan Sommer said in a statement.

BI spending will continue to increase because of other factors, such as the desire for department-specific and personal BI tools, according to the analyst firm.

But BI market growth will likely remain in the high single digits in coming years, due to "sluggish" macroeconomic indicators as well as "slowing sales cycles of multimillion-dollar end-to-end BI deals," Gartner said.

The BI market could also see a new era of expansion thanks to a trend Gartner calls data-as-a-service. Rather than buy traditional software tools to build analytic applications, "organizations increasingly will subscribe to industry-specific data services that bundle a narrow set of data with BI and analytic capabilities embedded," Gartner said.

Meanwhile, Gartner recently released a report on overall application software spending. The market will rise to $158 billion by 2016, up from $115.1 billion in 2011, according to that report.

Application spending this year is expected to be concentrated on industry-specific products; upgrades to important systems within customer environments; products that securely link mobile devices to "established systems"; and SaaS (software as a service) deployments that either extend or supplant existing systems, Gartner said.

IT budgets will also increase this year, but only to a modest degree, Gartner said. Fifty percent of IT budgets overall will see a rise, compared to 64 percent in Asia-Pacific and Latin America, according to the report.

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris' email address is Chris_Kanaracus@idg.com

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