According to a recent report published by Allied Market Research, titled, “Artificial Intelligence (AI) Market by Component, Technology, and Industry Vertical: Global Opportunity Analysis and Industry Forecast, 2021–2030,” the artificial intelligence market size was valued at $65.48 billion in 2020, and is projected to reach $1,581.70 billion by 2030, growing at a CAGR of 38.0% from 2021 to 2030.
Artificial intelligence (AI) makes it possible for machines to learn from previous experiences and adjust to new inputs to perform tasks like humans. Such capabilities of artificial intelligence technology enable machines to automate much more complex tasks such as driving cars (self-driving cars), holding conversations (conversational bots), filtering e-mail (spam and fraud detectors), among other things. Furthermore, key factors that drive the growth of the artificial intelligence market include growing demand to improve operational efficiency and the rising cost of manual labor. In addition, technological advancements in the field of artificial intelligence such as faster speech and natural language processing are positively impacting the growth of the artificial intelligence industry. However, high implementation cost of artificial intelligence (AI) solutions hampers the market growth. On the contrary, increasing digital dependence and industry 4.0 trends are expected to offer remunerative opportunities for expansion of the artificial intelligence market during the forecast period.
On the basis of technology, the machine learning segment dominated the overall artificial intelligence market in 2020, and is expected to continue this trend during the forecast period. This is attributed to increasing demand for advanced processing algorithms for complex industrial applications. However, the natural language processing (NLP) segment is expected to witness highest growth as demand for conversation automation is anticipated to grow in the coming years, which is expected to further fuel the growth of the global AI market.
Region wise, the AI market was dominated by North America in 2020, and is expected to retain its position during the forecast period, owing to high concentration of artificial intelligence solution vendors in the region. However, Asia-Pacific is expected to witness significant growth during the forecast period, owing to its ongoing rapid digital transformation trends that are expected to increase the scope for artificial intelligence industry in the region.
The outbreak of COVID-19 is anticipated to have a significantly positive impact on the growth of the AI industry. This is attributed to implementation of lockdown by governments in majority of the countries worldwide and the unavailability of workers during the period, which fueled the growth of industrial automation and digitization during the period aiding the rapid adoption of artificial intelligence technology in many business sectors that were primarily relying on manual systems. Moreover, artificial intelligence solutions are being used as a tool to support the fight against the viral pandemic that has affected the world since the beginning of 2020. For instance, in March 2021, a smartphone app that uses artificial intelligence to assess the sound of coughing; Hyfe was launched in the UK and Ireland. Such innovations are driving the growth of the AI industry and are expected to continue in the coming years.
Key Findings Of The Study
- By technology, the machine learning segment accounted for the largest artificial intelligence market share in 2020.
- By region, North America generated highest revenue in 2020.
- By industry vertical, the IT and telecom segment generated the highest revenue in 2020.
The key players profiled in the artificial intelligence market analysis are Amazon Web Services, Inc., Apple Inc., Google LLC, IBM Corporation, Intel Corporation, Microsoft Corporation, Nvidia, Oracle Corporation, SAP SE, and Siemens. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.