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Home Technology

Quantum-based services to drive QC future for now

FutureCIO Editors by FutureCIO Editors
August 21, 2023
Advanced quantum computer (Photo: Oxford Quantum Circuits website)

Advanced quantum computer (Photo: Oxford Quantum Circuits website)

IDC predicts that customer spending for quantum computing will grow from US$1.1 billion in 2022 to US$7.6 billion in 2027, representing a five-year CAGR of 48.1%. The forecast includes base quantum computing as a service as well as enabling and adjacent quantum computing as a service.

IDC has dropped the spending forecast and attributes the decline to slower than expected advances in quantum hardware development, which have delayed potential return on investment; the emergence of other technologies such as generative AI, which are expected to offer greater near-term value for end users; and an array of macroeconomic factors, such as higher interest and inflation rates and the prospect of an economic recession.

IDC expects the quantum computing market will continue to experience slower growth until a major quantum hardware development that leads to a quantum advantage is announced. Until then, most of the growth will be driven by maturation in quantum computing as a service (QCaaS) infrastructure and platforms and the growth of performance intensive computing workloads suitable for quantum technology.

IDC also expects investments in the quantum computing market will grow at a CAGR of 11.5% over the 2023-2027 forecast period, reaching nearly US$16.4 billion by the end of 2027. This includes investments made by public and privately funded institutions, internal allocation (R&D spend) from technology and services vendors, and external funding from venture capitalists and private equity firms.

Rewards of previous investments

The billions of dollars being allocated to the research and development (R&D) of quantum computing have led to recent advancements in quantum computing hardware and software, as well as new error mitigation and suppression techniques.

These advancements fuel speculation that achieving a near-term quantum advantage may be possible using today's noisy intermediate-scale quantum (NISQ) systems.

Over the long term, these investments are expected to result in the delivery of large-scale quantum systems capable of solving some of the most complex problems that challenge today’s scientists and engineers, causing a surge in customer spend towards the end of the forecast period.

Payback from 2022 investments

IDC sees 2022 as an eventful year in the quantum computing industry. Strategic approaches implemented to reach a near-term quantum advantage using NISQ systems became more defined as vendors published quantum computing road maps emphasizing methods for improving qubit scaling, as well as new techniques for error mitigation and suppression.

To improve the accessibility and usability of quantum systems, previously inaccessible quantum modalities became accessible for end-user experimentation, while other quantum hardware vendors announced partnerships for on-premises quantum deployments and quantum software vendors provided frictionless software offerings for nonquantum specialists.

Finally, quantum hardware and software vendors announced the anticipated launch of new scientific accelerator platforms that will help with the integration of quantum, AI, and HPC.

"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," said Heather West, Ph.D., research manager, research manager within IDC's Enterprise Infrastructure Practice.

"Today's quantum computing systems may only be suitable for small-scale experimentation, but advances continue to be made like a drumbeat over time. Organisations should not be deterred from investing in quantum initiatives now to be quantum ready in the future."

Heather West
Related:  Action items for observing data privacy beyond DPD
Tags: IDCQCaaSQuantum Computing
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