IDC predicts global quantum computing market to reach $7.6B by 2027

IDC forecasts that the quantum computing market will experience significant growth over the next five years, driven by investments in research and development, the maturation of quantum computing as a service infrastructure and platforms, and the increasing demand for performance-intensive computing workloads suitable for quantum technology.

The quantum computing market is expected to experience significant growth in the coming years.
Investments in the quantum computing market are expected to grow at a CAGR of 11.5% over the forecast period.
Advances in quantum hardware and software, as well as new techniques for error mitigation and suppression.

The worldwide Quantum Computing market is expected to experience significant growth in the coming years, according to a new forecast by International Data Corporation (IDC). The report projects that customer spend for quantum computing will increase from $1.1 billion in 2022 to $7.6 billion in 2027, representing a compound annual growth rate (CAGR) of 48.1% over the next five years.
However, this forecast is lower than IDC’s previous projection, which was published in 2021. Several factors have negatively impacted customer spend for quantum computing, including slower than expected advances in quantum hardware development, the emergence of other technologies such as generative AI that offer greater near-term value, and various macroeconomic factors like higher interest and inflation rates and the possibility of an economic recession.

IDC anticipates that the quantum computing market will continue to experience slower growth until a major breakthrough in quantum hardware development occurs, leading to a quantum advantage. In the meantime, most of the growth will be driven by the maturation of quantum computing as a service infrastructure and platforms, as well as the increasing demand for performance-intensive computing workloads suitable for quantum technology.

Investments in the quantum computing market are also expected to grow at a CAGR of 11.5% over the forecast period from 2023 to 2027, reaching nearly $16.4 billion by the end of 2027. These investments will come from public and privately funded institutions, technology and services vendors allocating funds for research and development, and external funding from venture capitalists and private equity firms. Notably, global government agencies have shown growing interest in quantum computing, with 14 countries and the European Union announcing long-term quantum initiatives that will generate billions of dollars for research.

The significant investments being made in quantum computing research and development have already led to advancements in quantum hardware and software, as well as new techniques for error mitigation and suppression. These advancements have raised speculation that achieving a near-term quantum advantage may be possible using today’s noisy intermediate-scale quantum (NISQ) systems. In the long term, these investments are expected to result in the development of large-scale quantum systems capable of solving complex problems faced by scientists and engineers, leading to a surge in customer spend towards the end of the forecast period.

IDC highlights 2022 as an eventful year for the quantum computing industry, with vendors implementing strategic approaches to achieve a near-term quantum advantage using NISQ systems. These approaches focus on improving Qubit scaling, as well as developing new techniques for error mitigation and suppression. Additionally, efforts have been made to enhance the accessibility and usability of quantum systems, making previously inaccessible quantum modalities available for end-user experimentation. Quantum hardware vendors have also announced partnerships for on-premises quantum deployments, while quantum software vendors have provided user-friendly software products for non-quantum specialists. Furthermore, the anticipated launch of new scientific accelerator platforms integrating quantum, AI, and high-performance computing has been announced.

Heather West, Ph.D., research manager within IDC’s Enterprise Infrastructure Practice, emphasizes that while today’s quantum computing systems may only be suitable for small-scale experimentation, advances are being made consistently over time. Organizations are encouraged not to be deterred from investing in quantum initiatives now to ensure they are prepared for the future of quantum computing.

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Background Information

About IDC: IDC, or International Data Corporation, is a global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. Established in 1964, IDC offers valuable insights into industry trends, market forecasts, and technology adoption through its research and analysis. Their expertise aids businesses, governments, and IT professionals in making informed decisions and strategies.

Technology Explained

Quantum Computing: Quantum computing is a type of advanced computing that takes advantage of the strange behaviors of very small particles. It's like having a supercharged computer that can solve incredibly complex problems much faster than regular computers. It does this by using special "bits" that can be both 0 and 1 at the same time, which allows it to process information in a very unique way. This technology has the potential to make a big impact in areas like data security and solving really tough scientific challenges, but there are still some technical hurdles to overcome before it becomes widely useful.