The global system integration market is expected to reach $750 billion by 2027, exhibiting a CAGR of 10.3 percent during the forecast period (2020-2027), as highlighted in a report published by Coherent Market Insights.
Emerging technologies such as cloud computing and big data analytics are expected to drive growth of the global system integration market during the forecast period.
Cloud computing operates on a pay-per-use basis, allowing small institutions and organizations to gain access to the expensive technology infrastructure. According to a survey conducted by IBM in 2011, out of 2,000 mid-sized companies, two-thirds were already planning to deploy cloud-based technology and around 70 percent were actively pursuing cloud-based analytics.
Since cloud computing helps to offload hardware maintenance and hosting to a vendor, system integrators are responsible for bridging the gap between enterprise buyers and cloud solution owners. Moreover, the advent of big data analytics has increased the demand for information management. Organizations such as Microsoft, SAP, IBM, and Oracle have invested more than $15 billion to develop solutions for big data analytics. These factors are expected to propel the global system integration market growth over the forecast period.
Many companies are laying off people due to the reduced sales volume owing to the COVID-19 pandemic. For instance, In U.S. according to the Coherent Market Analysis, the unemployment rate increased from 5.5 percent to 14.5 percent between December 2019 and April 2020. Owing to the financial losses faced by companies, it is expected that companies will reduce the expenditure on the system integration solutions and technological advancement during the year 2020. COVID-19 is expected to restrain the market growth during the year 2020.
With that said, smart building solution can present lucrative growth opportunities. Smart buildings refer to buildings equipped with energy-saving equipment, bells, and alarms. Smart buildings comprise building automation systems and smart networking technologies. In the U.S., for instance, the market for smart buildings is driven by owners and managers looking to reduce their energy spending. In Japan, on the other hand, the major driver for the smart building is the pressure to meet energy supply challenges. Smart buildings can have any number of modern equipment and instruments installed in it such as HVAC (heating, ventilation, and air conditioning) systems, lighting controls, sub-meters, cameras, and other devices.
High cost of implementation is expected to hinder the global system integration market growth over the forecast period. There are varieties of factors such as risk, and time associated with integration that influences these costs. Today, products are becoming more complex and difficult to manufacture and design. One such example is automobiles, which are becoming more complex with computer-controlled maintenance, braking and ignition systems. Additionally, in the past, once a product was designed, it had a long lifecycle over which to recover the development cost. Today, many technologically advanced products come with a shorter lifecycle. Thus, these factors are expected to hinder the global system integration market growth in the near future.
Major companies in the market are focused on partnership and collaboration activities, in order to gain a competitive advantage in the market. For instance, in February 2014, Infosys partnered with the University of Southern California. The objective of this partnership is to work with the Center of Global Supply Chain Management (CGSCM) focusing on the advancements in global supply chain management. Moreover, in August 2013, IBM Corporation partnered with Bank of the Philippine Islands (BPI). Under the agreement, IBM undertook all the IT network and data center activities of BPI.
Mobile applications are the other spectrum that system integrators are focusing on. Mobile application is no more a small industry; this industry is also witnessing the need for system integration solutions. Thus, in the near future, players in the system integration market would focus on integration of mobile applications.
For more information, visist the Coherent Market Insight website.