Big Data, Big Plans

As Germany gears up for digitalization across the industrial landscape, the market for big data is undergoing a period of pronounced growth. The impact of the information explosion on big industry in particular, will be nothing short of electrifying.

April 2019

The big data market just got bigger. The forecast growth for 2018 was ten percent on the previous year for hardware, software, and combined services in Germany, according to the German Association for Information Technology, Telecommunications and New Media (Bitkom). “More and more companies are using intelligent data analysis as a foundation to propel their business forward,” says its president Achim Berg. “Big data applications are creating ever more value across all industries, from diagnosis support in health industries to emergency service management in natural disasters.”

Growth is most pronounced in the hardware sector, with 18 percent year-on-year growth forecast for 2018 (and a turnover of around €671m). But the highest turnover is still in software, where €3.1bn has rolled through the accounts in 2018, a nine percent rise on 2017. The ICT services sector is not far behind, recording a €2.6bn turnover (year-on-year growth of 11 percent).

A data mining demonstration in the Industrie 4.0 area at the Bosch research center in Renningen, Germany. The electronics giant is working on new methods for extracting useful information from large amounts of data and evaluating it, for example, to predict machine maintenance requirements. © picture alliance/dpa

The information explosion

Big data is defined by Bitkom as the ability to process huge quantities of data from different sources at high speed. New forms of database, speech analysis, or visuali­zation tools are the key components. And the quantity of data is growing almost exponentially. Cloud-based computing experts Domo attempted to quantify the ever-increasing magnitude of bytes flying around the globe in their “Data Never Sleeps” presentation: 2.5 quintillion bytes of data created per day – a 90 percent increase over the previous two years. The report also notes that more than half of the world’s web traffic now comes through devices. It reckoned there were 3.6m Google searches per minute in 2017 and 4.1m YouTube video views.

2.5qn

2,500,000,000,000,000,000
(2.5 quintillion) bytes of data are created every day, says cloud computing expert Domo.

But it is in big industry where big data could have the most impact, revolutionizing the way we work and enabling the Internet of Things, which allows for real-time data exchange between objects, machines, and production plants. To drive uptake, developers are creating IoT platforms that allow companies to design their own applications.

Last year, one in three industrial companies invested between five and ten percent of annual revenue in IoT apps. Worldwide spending on IoT is estimated to reach some €650bn this year; and by 2025, McKinsey say, IoT tech will add as much as €3tn in value to networked factories.

Germany is a global nodal point for research for big data, especially in the critical areas of security and IoT, with facilities such as the Karlsruhe Institute of Technology and the Fraunhofer Big Data and Artificial Intelligence Alliance drawing worldwide acclaim.

© GTAI

Germany’s strategic position

Unsurprisingly, many overseas companies are looking to invest in Germany, in order to reap the benefits of its research institutions. The Italian company Fincons is one such example, with plans to set up an office in Germany in 2019. “Germany is perhaps Europe’s most crucial market for big data,” says deputy CEO Francesco Moretti. “Thanks to this and our successful collaborations with tier 1 players in this country, we are planning to set up a more permanent presence here, both in terms of customer volume and proximity to expertise particularly in the field of research and development. The conditions for our expansion are ideal for creating long-term value for our company in an industry on the crest of sharp growth.”

Market statistics portal Statista reckons that the size of the big data market in services will have more than doubled between 2016 and 2020 to €2.267bn, while the size of the overall market is forecast to be around €3.8bn in 2020, more than 100 percent up on the 2016 level. “Big data is one of the most important aspects of Industrie 4.0, which is currently central to Germany’s future industrial strategy,” says Henri Troillet, senior manager ICT at Germany Trade & Invest. “Germany’s commitment to the industrial and digital revolution has created a fervent climate for investment in a pioneering field with almost limitless potential. Add in the size of the domestic market and the world-class digital infrastructure, and the future for Germany in this market is going to be extremely globally relevant.”