Quantum Computing Spend to Reach $8.6 Billion
Given the trend thus far, quantum computing developments will be slow and steady. Meanwhile, optimistic growth projections abound. Enterprise spending for quantum computing will grow from $412 million in 2020 to $8.6 billion in 2027, according to the latest worldwide market study by International Data Corporation (IDC).
This represents a 6-year compound annual growth rate (CAGR) of 50.9 percent over the 2021–2027 forecast period. The forecast includes core quantum computing as a service, as well as enabling and adjacent quantum computing as a service.
IDC states that major breakthroughs in quantum computing technology, a maturing quantum computing as a service infrastructure and platform market, and the growth of performance-intensive computing workloads suitable for quantum technology will drive the majority of the market growth.
Quantum Computing Market Development
IDC also expects ongoing investments in the quantum computing market will grow at a 6-year CAGR (2021–2027) of 11.3 percent and reach nearly $16.4 billion by the end of 2027.
This includes investments made by public and privately funded institutions, government spending worldwide, internal allocation (R&D spend) from technology and services vendors, and external funding from venture capitalists and private equity firms.
Like any breakthrough technology of the last few decades, the industry will pour billions of dollars into making the technology commonplace and ready for mass adoption. The closest comparison is classical computing, the very technology that quantum computing is setting out to disrupt.
IDC anticipates that these investments will cause the current limited quantum computing capabilities to be replaced by a new generation of quantum computing solutions, leading to the development of new use cases and market segments that will accelerate the adoption of quantum computing to gain a competitive advantage.
As a result, the quantum computing market could see a surge in customer spending toward the end of the forecast period. However, so far the market growth has been somewhat slow and steady. Therefore, IDC sees 2021 as a pivotal year in the quantum computing industry.
Strategic approaches implemented to reach quantum advantage became more defined as IT vendors published quantum computing roadmaps emphasizing methods for improving qubit scaling and error correction.
IT vendors also sought new funding opportunities by going public or partnering with government, educational, or private entities (to spread the financial risk), or merged in anticipation of offering a more full-stack approach.
For most vendors, these approaches included the further development of the quantum ecosystem. This trend will continue into 2022 and beyond as quantum computing vendors progress towards quantum advantage and enterprises seek a competitive benefit of using emerging quantum technologies.
Outlook for Quantum Computing Applications Growth
“For many critical problems, classical computing will run out of steam in the next decade and we will see quantum computing take over as the next generation of performance-intensive computing,” said Peter Rutten, global research lead for performance-intensive computing at IDC.
Advances in quantum computing will be a drumbeat over time with the most distant advances being most relevant to the most complex problems. IDC analysts believe that organizations should start experimenting now using quantum road maps to guide their eventual quantum journey.
That said, I anticipate the technical complexity associated with the design and construction of these computers will continue to limit the market potential; at least until a viable solution to the deployment challenge emerges. Applications in financial modeling appear to have the greatest potential, but quantum may have a similar growth trajectory to artificial intelligence (AI) — typically exaggerated.
Originally published at https://blog.geoactivegroup.com on December 20, 2021.