Worldwide spending on quantum computing will grow significantly over the next few years, but not as much as previously forecast, according to International Data Corp. (IDC).
Quantum computing is a critical enabler of quantum networks. Both are based on quantum physics, enabling a potentially disruptive approach to communications. While some people see quantum networking eventually replacing today’s technology, others see it as a niche market for organizations that need a higher level of security.
IDC says that customer spending on the technology will grow from $1.1 billion last year to $7.6 billion in 2027, which is a five-year compound annual growth rate (CAGR) of 48.1%. The forecast includes base quantum computing and “enabling and adjacent quantum computing as a service.”
IDC says those numbers are “considerably lower” than in its previous forecast, which was released two years ago. In the interim, the category has seen slower-than-expected hardware development, which resulted in a delay in potential return on investment (ROI). The category also was hurt by the emergence of generative AI and other technologies that are expected to offer greater near-term value. Macroeconomic factors such as higher interest and inflation rates and fears of a recession also are factors in slower-than-expected growth.
The firm says that the slow growth will continue until a major quantum hardware development leads to a significant “quantum advantage.”
IDC also said that investment in quantum computing will grow by a CAGR of 11.5% between this year and 2027 when the amount invested will reach $16.4 billion. The analysts note that 13 countries and the European Union have announced multi-year initiatives that will generate billions of dollars for research.
“There has been much hype around quantum computing and when quantum computing will be able to deliver a quantum advantage, for which use cases, and when,” Heather West, Ph.D., the research manager within IDC’s Enterprise Infrastructure Practice, said in a press release.
“Today’s quantum computing systems may only be suitable for small-scale experimentation, but advances continue to be made like a drumbeat over time. Organizations should not be deterred from investing in quantum initiatives now to be quantum-ready in the future.”
While most quantum networks are run by academic and research organizations, Utility company and fiber network operator EPB officially launched a commercial quantum network in Chattanooga and began accepting applications for connection late last month. EPB became the first community-wide gigabit fiber network operator ten years ago.