Last year, Robotic Process Automation (RPA) was all the rage, as we saw market leader UIPath go public at a huge cost, as larger more established players began to scoop smaller and vendors. However, RPA always seems like a temporary automation solution to deal with legacy processes before moving to a smarter approach without code.
This appears to be supported by the latest data from Forrester Research, which predicts that the RPA software market will reach $ 6.5 billion by 2025, but with the caveat that growth will start to fall soon next year as companies has moved to more AI-fueled automation solutions.
“While we expect massive market growth in 2021 to continue throughout 2022, fueled by the need for automation caused by the pandemic and ongoing digital innovation programs, growth rates will begin to fall in 2023. , ”the company wrote in the latest RPA market report.
While a $ 6.5 billion increase from the 2018 report when the company predicted the market would reach $ 1.1 billion in 2019, it’s still a relatively small amount overall when you consider Salesforce just finished a quarter where it it reports more than $ 7 billion in revenue. own.
Market share services, which help implement these complex solutions, are expected to grow more steadily compared to RPA’s software revenue. According to Forrester, RPA -related services could reach $ 16 billion by 2025, nearly 3 times the software it is trying to help implement. If you combine services and software, this is an even more impressive $ 25 billion market by 2025.
Photo Credits: Forrester Research
Forrester analyst Leslie Joseph explained services revenue this way: “Services revenue counts the revenue that service vendors make by providing consulting, development, implementation, maintenance and support for these products. ” Service vendors include global systems integrators, consulting and advisory firms such as Accenture, IBM and EY, which may be partners or resellers of RPA software.
Forrester predicts that some of the money that goes into RPA software today will start moving to more comprehensive AI automation solutions. It’s noteworthy that while RPA has robotic in its name, it’s not really AI in the true sense. Bots in this case are more like scripts that complete a set of tasks manually. In comparison, code -free automation solutions simplify workflow creation, perhaps without consulting assistance. AI provides a way to intelligently execute tasks and take steps based on data rather than switching to a set of highly defined hard-coded work.
This decline comes despite investor enthusiasm for the market from investors who valued UIPath at $ 35 billion when it raised $ 750 million last year, the last private fundraiser before its IPO. Today, the company’s market cap is at close to $ 15 billion, certainly a massive drop in value, even considering the big hit software companies that took over the stock market last year.
Meanwhile, we also saw some fairly significant mergers as companies like SAP bought Signavio, ServiceNow acquired Intellibot and Salesforce acquired Servicetrace as a few examples. Blue Prism, which is one of the top three pure play RPA vendors, received a $ 1.6 billion offer from SS&C after rejecting orders from Vista Equity partners. That deal is expected to close later this month.
When TechCrunch surveyed five investors last year about the RPA market, we specifically asked them about how RPA technology can stay relevant in the long run. For the most part, investors have seen a market that could continue to expand, but if Forrester is right, the market could shift as customers look to more modern AI automation services.