Gartner Says Worldwide BI Spending to Grow 11 Percent in 2008

Published: April 1, 2008
Worldwide BI platform revenue is forecast to grow at a compound annual growth rate of 8.1 percent through 2012, to reach $7.7 billion in 2012.
Despite major consolidation among business intelligence (BI) vendors in 2007 and growing fears of an upcoming economic slowdown, BI platforms are expected to continue to grow at a strong rate, according to Gartner, Inc.
The worldwide market for BI platforms is forecast to reach $5.8 billon in 2008, an 11.2 percent increase from 2007. Worldwide BI platform revenue is forecast to grow at a compound annual growth rate (CAGR) of 8.1 percent through 2012, to reach $7.7 billion in 2012. Gartner analysts expect BI platform revenue to be less affected by an economic downturn than some other technologies because of the high priority BI platforms hold with CIOs. BI was the No. 1 technology priority in 2008 in a worldwide survey of 1,500 CIOs by Gartner Executive Programs.
“The fact that BI has held the top spot with CIOs in this survey for three years running makes us believe that BI will be more resilient against the effects of a possible downturn in IT spending than some other technologies,” said Dan Sommer, Senior Research Analyst for Gartner. “Furthermore, the survey indicates that CIOs are looking to increase their budgets for BI by about 11 percent this year.”
2007 saw a turbulent shakeout of BI vendors, with Microsoft growing its capabilities, and Business Objects (SAP), Cognos (IBM) and Hyperion (Oracle) being the most notable acquisitions of the year, resulting in a new playing field, dominated by these megavendors. Growth in 2007 has been partly inflated by Europe, the Middle East and Africa (EMEA), in which the strong euro has caused a boost of global growth rates when reporting in dollar terms. Overall for 2007, in dollar terms, EMEA and Asia/Pacific displayed stronger growth rates than North America, and they are expected to do so again in 2008.
Given the recent weakness of the U.S. economy, the technology market in North America is expected to see low growth for the first half of 2008. Much of the early weakness will be from organizations exercising caution in spending their budgets being prepared for a quick pullback should the economic situation decline more rapidly or severely than currently expected.