Growth in Passenger & Freight Traffic will boost IT Spending in Railways thru’2020: Technavio

Technavio RailwaysTechnavio analysts forecast the global information technology (IT) spending in railways market to grow at a CAGR of close to 16% during the forecast period, according to their latest report.

The research study covers the present scenario and growth prospects of the global IT spending in railways market for 2016-2020. The report also presents the vendor landscape and a corresponding detailed analysis of the top five vendors operating in the market.

Technavio ICT analysts highlight the following four factors that are contributing to the growth of the global IT spending in railways market:

  • Need to improve efficiency and reduce cost
  • Growth in passenger and freight traffic
  • Enhance passenger experience
  • Need to improve overall security

Need to improve efficiency and reduce cost

Authorities worldwide seek innovative and cost-effective technologies to enhance railway networks and increase the overall capacity. Railway operators adopt solutions such as predictive analytics, rail traffic system, freight operations management, location tracking system, and video surveillance to improve railway infrastructure. The service development costs can be significantly reduced by a well-defined IT solution, which optimizes resource usage and automates the decision-making process for the higher management.

“The Norfolk Southern Railway in the US implements IT projects that focus on reducing the overall costs and improving overall operational productivity. Authorities have adopted a new dispatch and traffic control system to improve scheduling and transit time. Also, they plan to use tools that provide dynamic routing and optimize railcar-trip planning in a bid to improve the overall flow of the railways network,” says Amit Sharma, a lead analyst at Technavio for IT spending by region and industry.

Growth in passenger and freight traffic

The global railways passenger and freight traffic are growing due to plummeting oil prices and increase in industrial activities. Latest offerings (such as mobile ticketing) coupled with the rise in the use of personal computing devices (like smartphones and tablets) are boosting the railway passenger volume.

According to a report released by Amadeus, the long-distance railway passenger traffic in Europe is predicted to increase by more than 20% to reach 1.36 billion passengers by 2020. The rapid urbanization and growing awareness about environmental issues have led to a consistent increase in the number of railway stations and trains worldwide.

“International trade and emerging economies, such as Eastern Europe and India and China in APAC are expected to grow strongly and this, in turn, will boost the railway freight traffic,” says Amit.

Enhance passenger experience

Railway authorities are focusing on improving passenger experience to increase the number of commuters. They are implementing the latest technologies to improve passenger experience. The use of ICT improves access to information and leads to better services, attracting more commuters and freight deals. The real-time information system enables passenger inquiries such as arrival and departure schedules, the status of booked tickets, and availability of trains. The availability of these data can improve customer satisfaction levels.

The efficient use of ICT makes a difference in a wide and complicated railway network, such as India. Passenger ticketing and inquiry systems are highly service oriented and are developed to provide easy access to customers.

Need to improve overall security

Increase in the number of passengers and freight volumes have raised safety concerns. Many passengers have lost their lives due to communication lapse and technical glitches in the system. In February 2016, more than ten passengers lost their lives and more than 100 were injured when two trains collided in Bavaria, Germany, due to the communication lapse between trains.

A secure network with excellent communication systems is critical to ensure safety. Therefore, railways worldwide have started using high-capacity digital technologies such as IP-based networks and high bandwidth systems.

About Technavio

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

If you are interested in more information, please contact our media team at

View source version on

Technavio Research
Jesse Maida
US: +1 630 333 9501
UK: +44 208 123 1770
Media & Marketing Executive


Comments are closed.