Mobility Gets on the Fast Track in Europe: Market Value to Reach Nearly $325 Billion in 2022

European spending on mobility solutions is forecast to reach $293 billion in 2018, according to a new update to the Worldwide Semiannual Mobility Spending Guide from International Data Corporation (IDC). IDC expects the market to post a five-year compound annual growth rate (CAGR) of 2.4%, leading to spending in excess of $325 billion in 2022.

Western Europe (WE) accounted for 78% of total mobility spending in 2017 and will remain by far the largest contributor in the wider European region, with a CAGR of 2.7% for the 2017–2022 period. At the same time, mobility expenditure in Central and Eastern Europe (CEE) will grow at 1.2%.

Mobility plays a central role in enterprises' digital strategies for an agile business, increased competitiveness, and greater customer engagement. New mobility use cases and technology adoption among enterprises is driving growth in all market segments from devices to software and services. Nevertheless, security and compliance are top issues for large mobility projects. According to Dusanka Radonicic, senior research analyst with the Telecoms & Networking Group in IDC Central and Eastern Europe, Middle East, and Africa (CEMA), increased data usage is driving growth in mobile business services spending, with business-specific applications dependent on high-speed data connectivity.

Consumers will account for around 65% of European mobility spending throughout the forecast, with slightly more than half of this amount going toward mobile connectivity services, and most of the remainder going toward devices, mainly smartphones.

Banking is forecast to be the European industry leader for mobility spending in 2018, followed by discrete manufacturing and professional services. More than half of mobility spending among businesses will go to mobile connectivity services and enterprise mobility services. Mobile devices will be the second-largest area of spending, followed by still considerable investments in mobile applications and mobile application development platforms. The industries that will see the largest mobility spending growths over the forecast period are utilities, state/local government and banking with CAGRs above 6%.

From a technology perspective, mobility services will be the largest area of spending throughout the forecast period, surpassing $190 billion in 2022. Within the services component, mobile connectivity services will continue to represent the largest portion, albeit with relatively flat growth, while enterprise mobility services will post a CAGR exceeding 14%. Hardware will be the second largest technology category, with spending forecast to reach $129 billion in 2022. Despite being the smallest technology category, software will see strong spending growth over the forecast period (12.1% CAGR), driven by mobile enterprise applications. Businesses will also increase their development efforts with mobile application development platforms recording a five-year CAGR of 18.4%, making it the fastest-growing technology category overall. Enterprise mobility management and mobile enterprise security are the most mature segments in the software category, with expected CAGRs of approximately 8% reflecting that status.

Western Europe represents more than three-quarters of the European market and is forecast to account for approximately 79% of total value in 2022. "Western European companies now have a clear understanding of the benefit mobility technologies can deliver and are evolving their approach — focusing on applications integrated with enterprise systems," says Gabriele Roberti, research manager for IDC EMEA Customer Insights and Analysis. "In customer-centric industries, like financial services and retail, mobility is becoming a pivotal part of digital transformation." Among Western European countries, the United Kingdom, Germany, and France remain the top spenders on mobility technologies, accounting for more than half of the regional market.

“Central and Eastern European companies are adapting their business models to integrate mobility technologies, seeking more flexible company structures to foster innovation, improving the infrastructure and connectivity, and mitigating the security concerns,” says Petr Vojtisek, research analyst for IDC CEMA Customer Insights and Analysis. Among CEE countries, Russia remains the single biggest market, accounting for over 38% of overall European mobility spending, followed by the cluster of countries referred to as the Rest of CEE (Slovakia, Ukraine, and Croatia), and by Poland. The fastest-growing countries will be jointly the Czech Republic and Romania, each with a spending CAGR of around 1.8% throughout the forecast period.

IDC's Worldwide Semiannual Mobility Spending Guide is designed to address the needs of technology organizations assessing the mobile opportunity by country, industry, and company size perspective. The spending guide provides subscribers with spending data on 10 technology categories across 20 industries, 5 company size bands, and 53 countries. Unlike any other research in the industry, this comprehensive spending guide can help IT decision makers to clearly understand the industry-specific scope and direction of mobility spending today and over the next five years.

About IDC Spending Guides

IDC's Spending Guides provide a granular view of key technology markets from a regional, vertical industry, use case, buyer, and technology perspective. The spending guides are delivered via pivot table format or custom query tool, allowing the user to easily extract meaningful information about each market by viewing data trends and relationships.

Source: IDC media alert