Artificial Intelligence Market Report

Artificial Intelligence Market Analysis By Solution (Hardware, Software, Services), By Technology (Deep Learning, Machine Learning, Natural Language Processing, Machine Vision), By End-use, By Region, and Segment Forecasts, 2014 - 2025

Published: July 2017  |  100 Pages  |  Format: PDF  |  Report ID: GVR-1-68038-955-5

Industry Insights

The global artificial intelligence market size was valued at USD 641.9 million in 2016 on the basis of its direct revenue sources and at USD 5,970.0 million in 2016 on the basis on enabled revenue and AI based gross value addition (GVA) prognoses. The market is projected to reach USD 35,870.0 million by 2025 by its direct revenue sources, growing at a CAGR of 57.2% from 2017 to 2025, whereas it is expected to garner around USD 58,975.4 million by 2025 from its enabled revenue arenas. Considerable improvements in commercial prospects of AI deployment and advancements in dynamic artificial intelligence solutions are driving the industry growth.

Rapid improvements in fast information storage capacity, high computing power, and parallelization have contributed to the swift uptake of the robotics and artificial intelligence technology in end-use industries such as automotive and healthcare. Further, the need for understanding and analyzing visual contents, for gaining meaningful insights, is expected to provide traction to the industry over the forecast period. 

Artificial Intelligence - Direct & Enabled Revenue, 2014 - 2025 (USD Million)

Artificial Intelligence market

The machine intelligence arena holds secure growth prospects, attributable to which, the key players are focusing on developing an integrated solution including hardware and software. Furthermore, to expand their customer reach, several vendors have collaborated with distributors and end users for product distribution. The increasing prominence of parallel processing applications is leading to increased adoption of the technology in scientific disciplines such as artificial intelligence and data science. Organizations are utilizing artificial intelligence to extract valuable insights from data for providing innovative products and improving customer experience; thereby, increasing revenue opportunities.

Artificial Intelligence is gaining prominence due to its complex, data-driven applications such as voice and image recognition. It offers a great investment opportunity, as it can be leveraged over other technologies to overcome the challenges of high data volumes, high computing power, and improvement in data storage.

The rapid adoption of virtual intelligence/ AI in end-use industries such as retail, healthcare, and automotive is expected to augment market growth over the forecast period. Organizations are making investments to incorporate artificial intelligence capabilities into their product portfolio. In November 2016, SK Telecom announced that it had signed an agreement with Intel Corporation to develop the vehicle-to-everything (V2X) technology and video recognition based on artificial intelligence.

Solution Insights

The market segmentation, based on AI solution type, includes hardware, software and associated service solutions. Progressive direct revenue garnered from sources such as software and service solutions, is projected to lead the market over the forecast period.

The hardware segment includes chipsets such as the Central Processing Unit (CPU), Graphics Processing Unit (GPU), Application-Specific Integrated Circuits (ASIC), and, Field-Programmable Gate Array (FPGA). Currently, the industry is dominated by GPUs and CPUs due to their high computing capabilities that are required for artificial intelligence frameworks. The segment is projected to be the fastest-growing segment with a CAGR of around 65.0%, over the forecast period.

AI-based software solutions include libraries for designing and deploying artificial intelligence applications including those for, inference, primitives, video analytics, sparse matrices, linear algebra, and multi-hardware communication capabilities. Further, the service segment includes installation, integration, and maintenance & support undertakings. AI service solutions market is expected to grow at a CAGR of above 60% over the forecast period.

Prudent improvements in information storage capacity, high computing power, and parallel processing capabilities have further contributed to the swift uptake of the artificial intelligence technology in dynamic end-use verticals. Additionally, the need for understanding and analyzing visual contents, among enterprises to gain meaningful insights, is expected to provide traction to the industry over the forecast period

Technology Insights

The Artificial Intelligence industry is segmented by core technologies into Natural Language Processing (NLP), Machine Learning, Deep Learning, and Machine Vision archetype. Deep Learning technology segment is anticipated to dominate the AI market; both in terms of revenue and CAGR over the forecast period of 2017 to 2025. ‘Deep Learning’ technology is gaining prominence on account of its complex data driven applications including voice and image recognition. It offers a huge investment opportunity as it can be leveraged over other technologies to overcome the challenges of high data volumes, high computing power, and improvement in data storage.

The deep learning & machine learning would cover the major investment area in AI throughout the forecast period. It includes both cognitive applications (i.e. machine learning, searching, tagging,  text and rich media analytics, filtering, categorization, clustering, hypothesis generation, question answering, visualization, alerting, and navigation) and AI platforms, which facilitate the development of intelligent, advisory, and cognitively enabled solutions.

Growing deployment of cloud-based computing platforms and on-premises hardware equipment for the safe and secure restoration of the large volume of data have paved the way for the expansion of the analytics platform. The rising investments in research and development carried out by the major leading players for further product developments also plays a crucial role.

Machine learning technology facilitates fresh opportunities for the growing retail industry by scaling human expertise with its near real-time learning and decision support capabilities. It enables retailers to provide more customized experiences and is poised to allow a broader range of innovation that promises to redefine the retail industry.

End-use Insights

The AI market includes end-use verticals such as healthcare, BSFI, law, retail, advertising & media, automotive and transportation, agriculture, manufacturing, and others. The advertising & media segment dominated the overall market and accounted for over 20% of the total market share in 2016. The AI Market by healthcare application further segregated in to use-cases including, robot assisted surgery, virtual nursing assistants, hospital workflow management, dosage error reduction, clinical trial participant identifier, preliminary diagnosis, and automated image diagnosis. Additionally BFSI applications market further includes, risk assessment, financial analysis/research, investment/portfolio management solicitations

Artificial Intelligence has witnessed tremendous growth in the recent past due to the necessity for advancement in the areas of machine translation, object perception, and object recognition. The landscape of tools and infrastructure for training and deploying of neural networks via ‘Machine Learning’ is further evolving rapidly. The rapid uptake of artificial intelligence in end-use industries such as retail and business analytics is expected to augment growth over the next few years.

Artificial intelligence technology is extensively deployed by several mobile and online services such as the Google Assistant, dialogue and voice recognition of Siri, Microsoft Cortana, image classification in Facebook & Google Photo, and Amazon’s Alexa. The increasing amount of digital data in the form of speech, videos, and images, from different social media sources such as IoT and consumer analytics, is driving the need for data mining and analytics.

Artificial Intelligence has many potential applications in the automotive sector such as in autonomous driving and Advanced Driver Assistance Systems (ADAS). Neural networks are widely adopted in vehicles for lane detection facilitating the replacement of expensive sensors. Further, artificial intelligence helps to organize a large amount of data collected for IoT sensors and mobile devices to improve the data collection and storage process. 

Artificial Intelligence Market, By End Use, 2016 (%)

Artificial Intelligence market

Regional Insights

Based on regions, the market is segmented into North America, Europe, Asia Pacific, South America, and the Middle East & Africa (MEA) geographies. In 2016, North America governed the global AI market in terms of revenue, owing to the availability of high government funding, the presence of leading players in the region, and strong technical adoption base. The region is anticipated to dominate the market over the forecast period. Furthermore, the espousal of cloud-based services in countries, such as the U.S. and Canada, is significantly contributing to the regional market growth.

In Europe, the cloud-based AI deployment is foreseen to witness remarkable growth in the forthcoming years due to increasing inclination of consumers towards advantages such as easy document control and faster and on-demand access to data. Further, many public and private organizations have been collecting domain-specific information comprising issues such as cybersecurity, medical informatics, marketing, fraud detection, and national intelligence. Big data based AI algorithms help in analyzing such unorganized and unsupervised data by continuously improving each set of data. 

The regional markets in Asia Pacific, South America, and the MEA region are anticipated to witness notable growth during the forecast period. Asia Pacific region is poised to exhibit the highest CAGR of more than 68.5% over the forecast period. The sustainable rise in technological development over time specifically in the lower developing countries in the Asia Pacific region induced the demand for the incorporation of the AI technology to go up.

Competitive Insights

Artificial Intelligence marketplace provides outstanding opportunities for investment firms, companies, and consultants looking for acquisitions or mergers. The persistent need for digital transformation is encouraging mergers and acquisitions at record levels amongst technical and non-technical AI stake-holding firms. The key industry participants include Atomwise, Inc., Lifegraph, Sense.ly, Inc., Zebra Medical Vision, Inc., Baidu, Inc., H2O ai, IBM Watson Health, NVIDIA, Enlitic, Inc., Google, Inc., Intel Corporation, and Microsoft Corporation, amongst others. 

Report Scope

Attribute

Details

Base year for estimation

2016

Actual estimates/Historical data

2014 - 2016

Forecast period

2017 - 2025

Market representation                                                 

Revenue in USD Million, and CAGR from 2017 to 2025

Regional scope

North America, Europe, Asia Pacific, South America, and the Middle East & Africa

Country scope

U.S., Canada, Mexico, Germany, UK, China, Japan, India, and Brazil

Report coverage             

Revenue forecast, company share, competitive landscape, growth factors, and trends

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Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest trends and opportunities in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the artificial intelligence market based on solutions, technologies, end uses, and region:

  • AI Solution Outlook (Revenue, USD Million, 2014 - 2025)

    • Hardware (HW)

    • Software (SW)

    • Services

  • AI Technology Outlook (Revenue, USD Million, 2014 - 2025)

    • Deep Learning

    • Machine Learning

    • Natural Language Processing

    • Machine Vision

  • AI End use Outlook (Revenue, USD Million, 2014 - 2025)

    • Healthcare

    • BFSI

    • Law

    • Retail

    • Advertising & Media

    • Automotive & Transportation

    • Agriculture

    • Manufacturing

    • Others

  • AI Regional Outlook (Revenue, USD Million, 2014 - 2025)

    • North America

      • U.S.

      • Canada

      • Mexico

    • Europe

      • Germany

      • UK

    • Asia Pacific

      • China

      • India

      • Japan

    • South America

      • Brazil

    • The Middle East & Africa
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