All across the globe, we’re seeing a growth in internet use and the many advantages that come with it. These are having a direct influence on the alternative data industry, resulting in substantial market growth opportunities.
The global alternative data sector is expected to develop at a 41.4 percent compound annual growth rate (CAGR) from $1.70 billion in 2020 to $2.41 billion in 2021. The change in growth is mostly attributable to an increase in demand for alternative data sources as a consequence of rising stock market trading activity. By 2025, the alternative data sector is expected to develop at a 39 percent compound annual growth rate (CAGR) to $8.98 billion.
According to a recent study by The Business Research Company, the following are some of the key market drivers:
Increased Number of Smart Cities
A spike in investments in smart city efforts in a number of countries across the globe is anticipated to boost the alternative data business. Information and communication technology is used in smart-city technologies to control and administer urban services such as transportation, water, and law and order. Big data might help with transportation, public safety, municipal budgeting, and other sectors. Predictive big-data analytics is also used by smart cities to evaluate which areas are likely to be crime hotspots and to anticipate crime locations.
Penetration of the Internet Has Increased
Established firms are investing heavily in alternative data as the world becomes increasingly computerized. The increasing use of the internet offers consumers and organizations with access to a wide variety of applications and increases the amount of data generated by users, driving increased demand for alternative data throughout the forecast period.
Increasing Adoption of 5G Networks
The rapid deployment of 5G networks is expected to fuel the alternative data industry in the near future. 5G networks will accelerate the uptake of alternative data applications and services while also providing new opportunities. 5G’s increased bandwidth allows for more data to be sent in less time, and its lower latency allows data to reach its destination faster. These networks provide greater coverage and can accept a variety of network topologies, allowing for the transmission of different types of data. 5G will increase data traffic not just from smartphones, but also from Internet-of-Things (IoT) linked devices.
Favorable Government Initiatives
Government efforts to foster smart technology in both developed and developing countries have a significant impact on the growth of the alternative data business. They want to work with digital enterprises to make the internet safer, protect personal data, maintain privacy, and learn about contemporary data science. Throughout the projection period, government initiatives are expected to have a positive impact on the alternative data business.
Growing Interest in Stock Trading
The growth of the alternative data sector will be fueled by increased interest in stock trading in the near future. Large stock trading firms are using alternative data approaches to boost return and profitability. As a consequence of the renewed interest in bonds, non-traditional bonds and approaches such as bottom-up corporate bonds and floating-rate bond funds have grown in favor. The rise in interest in stock trading is fueling the growth of the alternative data industry.
The alternative data market is made up of companies (organizations, solo traders, and partnerships) who offer alternative data and help with market insight discovery. Alternative data is described as non-traditional data that is not obtained from conventional sources such as corporate filings, analyst projections, or management directives and may be used to forecast a company’s future performance. This information may be utilized in pre-trade investment analyses as well as to assist investors in monitoring the financial health of a firm, industry, or nation.
Alternative Data Global Market Report 2021: COVID-19 Implications And Growth, one of a series of reports from The Business Research Company that provides alternative data market overviews, analyzes and forecasts alternative data market size, alternative data market players, alternative data market segments and geographies, the market’s leading competitors’ revenues, profiles, and martinis, is one of the reports that provides alternative data market overviews, analyses and forecasts alternative data market size, alternative data market players, alternative data market segments and geographies.
About The Business Research Company
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