Artificial Intelligence (Ai) Market Analysis North America, Europe, APAC, South America, Middle East and Africa - US, China, Germany, UK, France - Size and Forecast 2024-2028

Artificial Intelligence Market Size 2024-2028

The global artificial intelligence (AI) market size is estimated to grow by USD 237.4 billion between 2023 and 2028 exhibiting a CAGR of 30.07%. The market growth hinges on various factors, such as mitigating fraud and malicious attacks, integrating chatbots into AI systems, and boosting employee productivity. However, the artificial intelligence (AI) market faces significant challenges, notably the scarcity of AI experts. Additionally, affordability constraints and regulatory obstacles impede the widespread adoption of AI solutions. Overcoming the shortage of AI professionals is crucial for unlocking the full potential of AI technologies and driving market expansion. Addressing affordability concerns and navigating regulatory complexities are essential for fostering accessibility and compliance in AI implementation. Despite these challenges, the market remains poised for growth, driven by the increasing recognition of AI's transformative capabilities in enhancing security, automation, and operational efficiency across various industries.

The market research report forecasts include detailed analyses of the competitive landscape of the market and information about 15 market companies, including:

Advanced Micro Devices Inc., Alphabet Inc., Amazon.com Inc., Apple Inc., Argo AI LLC, Baidu Inc., China Cambrian Technology Co. Ltd., CognitiveScale, DataDirect Networks Inc., Graphcore Ltd., Huawei Technologies Co. Ltd., Intel Corp., International Business Machines Corp., Microsoft Corp., Nuance Communications Inc., NVIDIA Corp., Oracle Corp., Qualcomm Inc., Tesla Inc., and Wipro Ltd.

 Market Growth and Forecasting

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Market Dynamics

In the rapidly evolving tech landscape, Artificial Intelligence (AI) continues to be a major driver of innovation in Next-Generation Tech Fields. Key components of AI include Deep Learning Techniques, Natural Language Processing, Computer Vision, and Machine Learning Algorithms. Tech Giants are investing heavily in AI, with a focus on SaaS offerings and Cognitive Solutions. AI applications span various industries, such as Healthcare, where Automated Image Diagnostic systems and Fraud Prevention solutions are making a significant impact. AI also plays a crucial role in Data Analytics and Data Science, enabling Big Data processing and Intelligence Standards. Cloud Computing is a critical enabler for AI, providing the necessary infrastructure for Data Storage, Parallel Processing, and On-Premises solutions. The advent of Open-Source AI Platforms and the rise of Quantum Computers are set to revolutionize AI further. AI Market trends include the use of Pretrained Models, Algorithms, and Hardware advancements. Supercomputers and Deep Learning are at the forefront of AI research, pushing the boundaries of what's possible in this exciting field. Artificial intelligence is increasingly being integrated into medical device manufacturing outsourcing to enhance efficiency, streamline production processes, and improve the accuracy of device design and quality control. Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Drivers

The prevention of fraud and malicious attacks is notably driving the sector's growth. In the healthcare sector, Artificial Intelligence is increasingly being utilized for preliminary diagnoses through automated image diagnostics. This technology employs context-aware computing and computer vision to analyze medical images, enabling faster and more accurate diagnoses. However, the adoption in this field also presents potential risks. Cybercriminals may attempt to bypass security mechanisms and access sensitive patient information, leading to data breaches and privacy concerns. Despite these challenges, the benefits in healthcare, such as improved efficiency and accuracy, make it a valuable investment for organizations.

In recent years, the cybersecurity industry has seen an increase in fraud and Malicious attacks, from stealing personal information to important organizational data. Companies want to apply these technologies to combat these threats more effectively. The technology helps identify threats, identify patterns, and reduce response time. It also helps combat threats such as Distributed Denial of Service (DDoS) attacks. Hence, such factors drive the growth of the market during the forecast period.

Significant Market Trends

The emergence of narrow AI is the key trend in the market. It is revolutionizing technology and offering new ways for businesses to engage and interact. Applications span various sectors, from recommendation systems and pricing optimization to lead generation and chatbots. It is making strides in healthcare with Preliminary Diagnosis and Automated Image Diagnostic tools powered by Computer Vision and Context-Aware Computing.

Moreover, adopting AI in on-premises data centers necessitates substantial computational and data storage resources. For companies developing in-house AI products, the costs can be substantial. In general, the algorithm needs to be retrained or modified to apply narrow AI to different domains. General algorithms that can be applied to many problems are still a few years away.

Major Market Challenges

A shortage of AI experts is the major challenge impeding AI sector growth. In the realm of Artificial Intelligence (AI), many businesses encounter challenges in implementing advanced technologies such as machine learning and deep learning due to resource constraints and expertise shortages. Preliminary Diagnosis in this context refers to the initial assessment businesses must make before investing in AI. For instance, Automated Image Diagnostic systems, a type of AI application, necessitate large data sets and sophisticated infrastructure for effective training. Context-aware computing, another AI application, requires advanced processing power and a team of experts to optimize performance.

Additionally, Computer Vision, a subfield of AI, poses similar challenges due to its data-intensive nature. These requirements, coupled with the competition for top AI talent, make it a significant investment for most companies, limiting their ability to fully leverage AI's potential. So, that's one of the potential challenges that can hamper the AI market growth during the forecast period.

Market  Segmentation

By Component Industry Segmentation

The AI sector share growth by the software segment will be significant during the forecast period. The market expansion encompasses the use of advanced tools like Variational Autoencoders and Diffusion Networks by developers in IT and telecommunication, retail & e-commerce, agriculture, education, media and entertainment, finance & accounting, cybersecurity, legal and compliance, operation, and various other sectors. Pretrained models and customizable AI are essential units, with AI marketplaces facilitating access to these tools. Tech Giants and next-generation tech fields, including biopharmaceutical companies, leverage AI for data management, fraud prevention, workflow management, trend forecasting, and more. 

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The software segment was valued at USD 23.2 billion in 2018. SaaS, hardware, software, data storage, and parallel processing are integral components of the AI ecosystem. Conversational AI, call centers, and cutting-edge technology are transforming industries like finance, marketing, and robot-assisted surgery, and even modern-day robotics. Open-source AI platforms are driving innovation in areas like dosage error reduction, virtual nursing assistants, and hospital workflow management.

By End-user Industry Segmentation

Artificial Intelligence (AI) is revolutionizing the retail industry with its numerous applications, making it a significant segment in the global AI market. Preliminary Diagnosis through AI is transforming retail operations, enabling accurate and efficient supply chain planning as well as log management. In customer service, Automated Image Diagnostic using AI enhances shopping experiences by providing personalized product recommendations based on Context-Aware Computing and purchasing patterns. Computer Vision is utilized for merchandising in omnichannel operations, ensuring seamless digital assistant integration and IT automation. Sales processes are optimized through AI-driven recommendation and automation systems, while supply and logistics benefit from advanced AI technologies.

Regional Analysis

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North America is estimated to contribute 56% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

The market in North America is expected to be spearheaded by the US, with significant investments from IT and telecommunication companies, tech giants such as Google, IBM, Microsoft, and Amazon Web Services, and the private sector. In the AI industry, there is a trend towards fewer, larger investments, with a focus on leading institutions and deployable applications in sectors like healthcare, education, and autonomous driving. Key AI technologies include variational autoencoders, diffusion networks, and retrieval augmented generation.

Furthermore, other industries investing in AI include retail & e-commerce, agriculture, media and entertainment, finance & accounting, cybersecurity, legal and compliance, and operation. Pretrained models, customizable AI, and AI marketplaces are also driving growth in the sector. Notable applications include fraud prevention, workflow management tools, trend forecasting for financial firms, conversational artificial intelligence in call centers, and next-generation tech fields like robot-assisted surgery, dosage error reduction, virtual nursing assistants, and hospital workflow management. Additionally, open-source AI platforms, hardware, software, data storage, parallel processing, on-premises solutions, marketing and sales, advertising and media, and biopharmaceutical companies are contributing to the growth of the AI market. These investments in AI tech will facilitate market growth in the region.

Key Companies & Market Insights

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Advanced Micro Devices Inc. - In the realm of deep learning and artificial intelligence (AI), the company excels in delivering streamlined project deployments and accelerated application development solutions. The AI market encompasses this innovation, offering advanced technologies that enhance efficiency and productivity.

Alphabet Inc. - The company specializes in artificial intelligence (AI) technology, offering advanced platforms for various applications in the AI market.

Tesla Inc. - The company's AI-driven approach for vision and planning, coupled with optimized use of inference hardware, is the sole means to attain a comprehensive solution for full self-driving and beyond, which are the core offerings under its AI segment. Additionally, its automotive segment encompasses various services such as non-warranty after-sales vehicle services, used vehicle sales, retail merchandise, sales from acquired subsidiaries to external customers, and revenue generated from vehicle insurance.

Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

Market Analyst Overview

AI marketing refers to the use of AI technologies, such as machine learning and natural language processing as well as talent management software, to enhance and optimize marketing efforts. This can include analyzing customer data to identify trends and preferences, personalizing marketing messages, and automating repetitive tasks. The AI market is continuously growing, with companies like Google, Microsoft, and IBM leading the way in AI development and implementation. The use of AI in marketing is becoming increasingly common, with 80% of Fortune 500 companies reportedly using AI for marketing in 2020. The benefits of AI marketing include improved customer engagement, increased efficiency, and more effective targeting and personalization. Companies that fail to adopt AI marketing risk falling behind their competitors. The future of AI marketing is bright, with advancements in areas such as chatbots, predictive analytics, and voice recognition set to revolutionize the industry.

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What are the Key Data Covered in this Artificial Intelligence (Ai) Market Research Report?

• CAGR of the market forecasting
• Detailed information on factors that will drive the growth of the market between 2024 and 2028
• Precise estimation of the size of the market  size and its contribution of the market in focus to the parent market
• Accurate predictions about upcoming trends and changes in consumer behaviour
• market growth analysis across North America, Europe, APAC, South America, and Middle East and Africa
• Thorough analysis of the market's competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of market companies