Global AI Spending Expected to Reach $434 Billion in 2022

Global AI Spending Expected to Reach $434 Billion in 2022

Global AI Spending Expected to Reach $434 Billion in 2022

The global revenues for the artificial intelligence (AI) market, including software, hardware, and services, are forecast to grow 19.6 percent (on-year) in 2022 to $432.8 billion, according to a new report.

The market is expected to break the $500 billion mark in 2023, reports International Data Corporation (IDC).

AI solutions are currently focused on business process problems and range from human augmentation to process improvement to planning and forecasting, empowering superior decisions and outcomes.

Ritu Jyoti, Group VP, Worldwide Artificial Intelligence (AI), Automation Research, IDC, said, “Advancements in language, voice and vision technologies, and multi-modal AI solutions are revolutionizing human efficiencies.”

AI software will see its share of spending decline slightly in 2022 as spending for AI hardware and services grows more quickly. This trend will continue into 2023.

Overall, AI services is forecast to deliver one of the fastest spending growth over the next five years with a compound annual growth rate (CAGR) of 22 percent while the CAGR for AI Hardware will be 20.5 percent.

Jyoti said, “Overall, AI plus human ingenuity is the differentiator for enterprises to scale and thrive in the era of compressed digital transformation.”

In the AI software category, AI applications accounted for 47 percent of spending in the first half of 2021, followed by AI System Infrastructure Software with around 35 percent share.

Jennifer Hamel, Research Manager, Analytics and Intelligent Automation Services, said, “AI remains a key driver of IT investment, which in turn boosts spending on related services to ensure sustainable adoption at scale.”

The AI hardware category grew the most in terms of market share in the first half of 2021 with a jump of 0.5 percent share.

It is forecast to reach 5 per cent market share in 2022 with year-over-year growth of 24.9 per cent.

Peter Rutten, Research Vice President, Performance Intensive Computing at IDC, said, “Of all the spending in the various AI market segments, AI Hardware is by far the smallest.”

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