The industry will continue to grow as the value of its services becomes more widely accepted
Los Angeles, California (PRWEB) January 11, 2012
The Virtual Data Rooms industry is growing very quickly, with industry revenue expected to reach $628.1 million in 2012, a 17.1% increase from 2011 and an annualized growth rate of 17.4% since 2007. According to IBISWorld industry analyst Kevin Culbert, “driving this growth has been the economy-wide transition toward providing services online as technological advancement allows. In particular, the proliferation of access-limited document sharing data infrastructures and programming experts in those fields has enabled this industry to flourish without requiring huge investments in. At the same time, the time and money savings this industry offers to virtual data rooms (VDRs) users to examine confidential documents has made them enormously valuable to investors. Because of this additional value, the ability of users to access otherwise secret information can greatly expand the number of investors to whom they can offer such access.” Because VDRs are most often used to provide corporation information to those interested in buying companies, offering access to more buyers directly translates into receiving more competitive bids.
Due to these factors, IBISWorld anticipates the industry to continue growing strongly, even amid weak financial markets, as the value of this industry’s services becomes more widely accepted. Weak financial markets may even benefit this industry, says Culbert, since bankruptcy-induced buyouts are major uses of this industry’s product. Revenue, therefore, is expected to grow 14.8% annually over the coming five years. Though concerns for this industry loom, such as the threat of an aggressive price war or a large, well-publicized security breach, the intrinsic value proposition of this industry’s service should continue to drive exponential growth for the foreseeable future. It will, however, be incumbent upon prospective enterprises to ensure access to a network of potential customers, to whom the businesses in this industry are largely undifferentiated.
The Virtual Data Rooms industry has a high level of concentration. In 2012, IBISWorld estimates that the industry’s three largest players will account for 79% of industry revenue. Nevertheless, adds Culbert, “the industry is still growing and new players are continuing to enter the arena. In the five years to 2012, the number of firms operating in the industry is expected to increase at an average annualized rate of 16.7% to 214 enterprises. This growth is expected to continue in the five years to 2017.” In spite of this growth, however, the industry is expected to remain relatively concentrated. Many of the smaller players in the industry specialize in certain niche markets, limiting their ability to gain a significant market hold. Industry major players include Merrill Corporation, IntraLinks Holdings and RR Donnelley.
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This industry provides clients with virtual data rooms (VDRs), which are secure document sharing and storage solutions geared toward legal due diligence, mergers and acquisitions (M&A), initial public offerings (IPO), bankruptcies and other information-sensitive applications.
Virtual Data Rooms Industry Report Key Topics
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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