IDC forecasts global cognitive systems market to grow rapidly to $31 billion in 2019.

According to a recent study (Worldwide Semiannual Cognitive Systems Spending Guide) by IT market analysis and consulting firm IDC (www.idc.com), the global cognitive systems market is projected to grow rapidly, showing a compound annual growth rate (CAGR) of 55% over the next five years starting from last year.

The market size is expected to reach $31.3 billion (*based on spending) in 2019. This study expanded the scope of research by including spending on cognitive computing-related hardware and services in addition to IDC's existing cognitive software forecasts. In addition, it provides detailed information on the cognitive systems market by region, industry, and use case.

Cognitive computing is one of the six innovative technologies defined by IDC, including IoT, next-generation data security, 3D printing, cognitive technology, robotics, and augmented/virtual reality, and is attracting attention as a key technology driving digital transformation by generating new revenue, leading information-based organizations, and changing the way work is done.

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During the forecast period, more than 40% of the total cognitive systems market is expected to be concentrated on cognitive applications (including text and rich media analysis, tagging, search, machine learning, classification, clustering, hypothesis generation, question answering, visualization, filtering, alerting, and exploration) and cognitive software platforms (facilitating intelligence, advisory, and cognitive solutions).

The largest and fastest-growing field is cognitive applications

The largest and fastest-growing sector in cognitive systems is cognitive applications, which is projected to grow to $13.4 billion in 2019. Following this, cognitive computing-related services (*business services and IT consulting) are showing the second fastest growth, and the hardware sector (mainly servers and storage) is also expected to grow rapidly, rivaling that of software.

David Schubmehl, Research Director for Cognitive Systems and Content Analytics at IDC, stated, "A major innovation and resurgence is taking place in the information processing and analysis of unstructured and semi-structured data." "He said, 'This has equipped a new generation of tools and capabilities to provide intelligent assistance, advice, and recommendations to consumers and knowledge workers worldwide.'"

He went on to explain, "As cognitive solutions are developed and built based on cognitive software platforms, tools and functions have become possible to extract and build knowledge bases and knowledge graphs from unstructured/semi-structured information, and to provide predictions, recommendations, and intelligent support using machine learning, artificial intelligence, and deep learning."

In addition, the market for cognitively enabled applications and cognitive software platforms is just beginning to blossom, and IDC stated that it expects investment in this sector to accelerate during the forecast period.

The retail and healthcare sectors combined amount to $10 billion

The banking sector is projected to account for 20% of the global cognitive systems market during the forecast period and is expected to be the most heavily invested sector. Leading areas for cognitive systems in the banking industry include fraud analysis and investigation, automated threat intelligence and prevention, and program advisors and recommendations.

The retail and healthcare sectors account for the next highest share, and the combined size of the cognitive systems market for the two sectors is expected to reach $10 billion in 2019. Key use cases in the retail sector include automated customer service agents and merchandising for omnichannel operations, while key use cases in the healthcare sector include diagnostic and treatment systems.

"The potential for cognitive systems is diverse and rich," said Jessica Goepfert, Program Director leading Customer Insights and Analysis research at IDC. "For example, automated threat intelligence helps companies and organizations draw conclusions from pieces of information to strengthen security, while in the medical field, cognitive systems are improving human quality of life by aiding diagnosis and treatment at the individual patient level." She added, "Regardless of the field in which cognitive systems are utilized, workers and businesses are expected to be impacted by the power of more information, intelligence, and automation."

Geographically, North America (the United States and Canada) is currently the largest spender on cognitive systems and is expected to account for approximately 80% of the total global cognitive systems market during the forecast period. While Europe, the Middle East, and Africa (EMEA) is currently the second largest region, IDC forecasts that the Asia-Pacific region, including Japan, will overtake EMEA by the end of the forecast period.