50% Expansion of GIS Market Predicted by ARC Advisory Group in Five Years

ARC Advisory Group, a market research firm focused on the manufacturing, energy and supply chain IT sectors, has issued a prediction (press release) that the GIS market will grow 50% within the next five years based on a compounded annual growth rate (CAGR) of 9.3%. Clint Reiser, the report’s author states that, "The market for 2009 is $1.48 billion. That is a slight reduction from 2008, which we have at $1.511 billion." This revenue number is inclusive of software, implementation services, maintenance & support, and software as a service revenues. According to ARC Advisory Group, this phenominal growth will be the result of two driving forces:

1. Smart Grid initiatives - according to the report, "The Smart Grid initiative will introduce distributed generation and new devices into the electric power grid.  This will require substantial network reengineering.  GIS is the likely technology to be used for the design, analysis, and ongoing management of the new network configuration."

2. Emerging economies - according to the report, "Growth in the mid to latter years of the forecast period will be driven by increased adoption of GIS in emerging markets such as Asia, Latin America, and the Middle East; and a return to spending in North America and Europe by industries hardest hit by the global economic downturn."

This report seems to validate IDC market analyst David Sonnen’s opinion reported in today’s article in which Sonnen was asked about the growth of the business analytics market that is expected to grow at a CAGR of 7.3%. "Right now, it looks like spatial analytics will grow a bit faster - how much faster is hard to say. But, there is currently a lot of interest in spatial technology broadly, and I expect that interest will translate into increasing revenue as the recession abates," said Sonnen.

We have now two reports estimating the growth of the GIS market sector to be projected to grow somewhere in the 7.3% to 9.3% range. The recently released Daratech market research report puts revenue at approximately $2.3 Billion and growth to be down 0.7% in the private sector and up only 4.1% in the public sector.

For those of you who are always looking for the "growth numbers" of GIS, this perhaps more data than we have had in several years.