Momentum toward irreversible changes for the $766.5 billion information industry has reached a tipping point, and businesses that don’t adapt now are at risk, according to Outsell, Inc., The research and advisory firm today released its 2016 Information Industry Outlook Report, “Tipping Point,” to help companies understand these trends, and the actions they must take to maintain leadership in a new environment.
“Transformative change has been the norm for so long that it almost has a numbing effect. But change of a different and bigger kind is in motion,” said Leigh Watson Healy, Chief Analyst, Outsell. “Yet this threat, handled well, can lead to an opportunity renaissance for our industry.”
The information industry is a blend of fast-growing information, software, services, and technology companies and moderate-growth content publishers and media. Market segment analysis shows that Search & Aggregation is the growth frontrunner, but Marketing Analytics, Automation & CRM will soon edge from second into first place. These industry segments, along with Human Capital Management and Financial, Credit, and Governance, Risk & Compliance, will drive the industry in the next several years.
Among the 10 tipping points that Outsell cites:
- Millennials and How They Work – This generation is now the largest in the workforce, and in three to five years, they’ll move into influential management positions. How they collaborate and discover, use and share information is vastly different than previous generations. 77% want seamless access to information, 61% are active on LinkedIn, and they rely less on external information than ever before. Companies must adapt to their preferences now in order to succeed.
- Machines Getting Smarter and Taking Charge – Predictive analytics is quickly moving to prescriptive analytics, and cognitive computing on top of big data from the Internet of Things is tipping power to the algorithm. This will drive more changes in how people (and/or machines) work and make decisions in industries such as healthcare, law, education and finance.
- Hyper-Scale Goes Big, as companies complete acquisitions or spinoffs to dominate one or two sectors, and own the workflows for entire verticals, personas or functions. Transformative deals this year alone — including Dun & Bradstreet’s (NYSE: DNB) acquisition of NetProspex, Verisk’s (Nasdaq: VRSK) purchase of Wood Mackenzie, the joint venture of Holtzbrinck Publishing Group and Springer Science + Business Media, LinkedIn’s (NYSE: LNKD) acquisition of Lynda.com, McGraw-Hill Financial’s (NYSE: MHFI) purchase of SNL Financial, Pearson (LSE: PSON; NYSE: PSO) selling off the Financial Times and The Economist Group, and Informa’s (LSE: INF.L) sale of Datamonitor – all demonstrate the power of honing portfolios.
- Hyper-Niching – Convergence of the cloud and APIs as platform, content, technology and solutions is opening opportunities for hyper-verticalization. Deep verticals, from very small law firms to designer farming, will deliver scale to startups and market leaders alike.
“For leaders and newcomers to the information industry, the next several years will not be for the faint of heart,’ said Anthea Stratigos, Outsell’s Co-Founder & CEO. “Winners will need to be nimble, smart and focused.”
Outsell’s report also identifies 31 disruptive companies to watch – such as Enigma.io, Gild, and Spiceworks. The analysis is based on Outsell’s tracking of 15 segments and over 7,000 firms, along with their customers and advertisers.
To help CEOs navigate the transformation, the firm is launching new services, including an exclusive online platform linking machine generated content, with thought-leadership and community in a single environment for members of Outsell’s Leadership Council (OLC) and beyond.