Global AI market size estimated at US$ 119.78 bn in 2022
By Ibidunni Banjoko
The global artificial intelligence (AI) market size was estimated at US$ 119.78 billion in 2022 and it is expected to hit US$ 1,591.03 billion by 2030 with a registered CAGR of 38.1% from 2022 to 2030, meanwhile the North America artificial intelligence market was valued at USD 51 billion in 2021.
This report was based on Precedence research Artificial Intelligence (AI) Market by Offering: Hardware, Software, Services; By Technology: Machine Learning, Natural Language Processing, Context-Aware Computing, Computer Vision; By Deployment: On-premise, Cloud; By Organization Size: Large enterprises, Small & medium enterprises; By Business Function: Marketing and Sales, Security, Finance, Law, Human Resource, Other; By End-Use: – Global Industry Analysis, Size, Share, Growth, Trends, Regional Outlook, and Forecast 2022 – 2030
Also, the advertising & media segment will have a significant contribution to the global revenue share in 2022. This share is attributable to the growing AI marketing applications with significant traction. For instance, in January 2022, Cadbury started an initiative to let small business owners create their AD for free using the face and voice of a celebrity, with the help of an AI tool. However, the healthcare sector is anticipated to gain a leading share by 2030. The healthcare segment has been segregated based on use cases such as robot-assisted surgery, dosage error reduction, virtual nursing assistants, clinical trial participant identifier, hospital workflow management, preliminary diagnosis, and automated image diagnosis. The BFSI segment includes financial analysis, risk assessment, and investment/portfolio management solicitations.
The rapid penetration of digital technologies and the internet has significantly contributed towards the growth of the global artificial intelligence market in the past few years. The heavy investments by the tech giants in the research and development are continuously fuelling the technological advancements in various industries. The burgeoning demand for the artificial technology among the various end use verticals such as automotive, healthcare, banking & finance, manufacturing, food and beverages, logistics, and retail is expected to significantly drive the growth of the global artificial intelligence market in the forthcoming years. Technological innovations have always been an important part of the majority of industries.
The rising popularity of various life-saving medical devices and the self-driving feature in the new electric vehicles is significantly boosting the growth of the AI market across the globe. The shifting focus of the globe towards digitalization is positively impacting the market growth. The top global tech giants such as Google, Microsoft, IBM, Amazon, and Apple are increasing their investments in the upgradation and development of various applications of AI. The rising efforts of the tech giants towards improving the access to AI is expected to foster the growth of the global AI market during the forecast period.
Favourable government initiatives are expected to impose a positive impact on industry growth. The establishment of subcommittees on machine learning and AI within the federal government has drawn traction toward the AI industry. In 2020, The Government of India increased the spending for Digital India to $477 million to boost AI, IoT, big data, cyber security, machine learning, and robotics. The artificial intelligence market is expected to witness significant growth in the Banking, Financial Services, and Insurance (BFSI) sector on account of data mining applications as there is an increase in the adoption of artificial intelligence solutions in data analytics, fraud detection, cybersecurity, and database systems.
End-use industries have started integrating artificial intelligence into their business processes to streamline their operations. The artificial intelligence technology is gaining momentum as it assists end-user organizations to become more efficient and result oriented. The growing adoption of artificial intelligence is encouraging new entrants to venture into the AI marketplace by offering niche application specific products and solutions. Furthermore, companies are also taking several strategic initiatives in industry consolidations to gain competitive advantages.
The artificial intelligence industry has been a software player so far, and very few companies manufacture hardware components such as CPU, ASIC, FPGA, and GPU. Recent trends in design tools have made FPGAs compatible with complex software practices and accessible to those who organize and build algorithm models. Hardware-based artificial intelligence solutions are being introduced to combat challenges associated with power consumption, sluggish processing, and lack of efficiency.
Furthermore, as the market is maturing, there is an increasing need for creating a new business model through predictive, efficient automation and scalable parallel processing capabilities.
The need for hardware-based artificial intelligence products was recognized as end-use applications demanded lower power and higher performance. Over the past few years, very few companies ventured into the development of these components. However, to gain a competitive advantage, vendors such as IBM Corporation and Intel Corporation have started manufacturing artificial intelligence chipsets to obtain high performance in scaling parallel dynamic processes.
The software segment contributed the largest share in 2022. The improvements in the data storage system, parallel processing, and improved computing power are the major drivers of the software segment in the AI market. The higher demand for the software technologies for the deployment and designing of AI applications such as linear algebra, video analytics, hardware communication capacity, inference, and sparse matrices is fueling the growth of the segment. The rising need for the enterprises to gain meaningful data and information through visual content analysis is expected to boost the demand for the software solutions in the global artificial intelligence market.
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