International. According to a new research report, the AI market is expected to be valued at $21.5 billion in 2018 and is likely to reach $190.6 billion by 2025, with a CAGR of 36.6% during the forecast period.
The report called "Artificial Intelligence Market by Offering (Hardware, Software, Services), Technology (Machine Learning, Natural Language Processing, Contextual Computing, Computer Vision), End User Industry and Geography – Global Forecast to 2025", was made by the analyst firm Markets and Markets.
The major drivers of the market are the growth of big data, the increasing adoption of cloud-based applications and services, and the increasing demand for intelligent virtual assistants. The main limitation for the market is the small number of experts in artificial intelligence technology. Critical challenges facing the AI market include concerns regarding data privacy and the unreliability of AI algorithms. Underlying opportunities in the AI market include improving operational efficiency in the manufacturing industry and adopting AI to improve customer service.
Deep learning is expected to grow at the highest CAGR during the forecast period
The increasing use of deep learning in applications such as image recognition, speech recognition, and data mining is the main factor resulting in its growth. In addition, the increasing adoption of deep learning algorithms to derive vital information generated from electronic and portable health record systems (EHRs) and their use in the drug discovery application are the key factors driving the growth of the market.
On the other hand, the report indicates that the software market is expected to have the largest share in the artificial intelligence market. The software market is growing due to the rise of AI conversation platforms. In addition, AI platforms and general-purpose software are used to develop interfaces and applications ranging from conversational interfaces to predictive and prescriptive applications that offer advice and recommendations. The AI software platform primarily focuses on the TOOLS and API framework for AI and ML-based applications and technologies using structured and unstructured data to power these applications.
End-user manufacturing is estimated to grow at the highest CAGR during the forecast period
The manufacturing industry is witnessing a new wave of technological revolution, which is driving the idea for the implementation of artificial intelligence (AI) in the plant. AI-based solutions are adopted in manufacturing facilities to improve productivity by maximizing asset utilization, minimizing downtime, and improving machine efficiency. In addition, AI in manufacturing is expected to increase productivity through quality control by detecting defects and aiding in predictive maintenance of factory machinery. This factor is expected to drive the growth of the artificial intelligence market in manufacturing. Deep learning, natural language processing, context knowledge, and computer vision are the main technologies used for data extraction, image analysis, signal analysis, decision making, and execution.
North America would have the largest market share
North America is expected to hold the largest share and dominate the AI market between 2018 and 2025. Rapid developments in infrastructure and high adoption of digital technologies are the two major drivers of the ARTIFICIAL intelligence market in the region. In addition, the region, a well-established economy, has also seen large-scale investments in AI, as a result of which, both start-ups and well-established companies are concentrating more on developing innovative AI-based solutions to cater to various industry verticals. In addition, smart city initiatives are increasing in the North American region, due to which there is also an increase in raw data. The need to analyze such raw data to extract relevant insights has increased demand for various AI platforms, such as Google's Cloud Prediction API, Microsoft Azure ML, and Amazon's AWS in this region.
The artificial intelligence market in Asia Pacific (APAC) is expected to grow at the highest CAGR during the forecast period. In security, with the rise of cyber attack incidents and cyber warfare on the rise in the region, organizations and governments are focusing on a robust defense infrastructure. APAC, especially China, Japan and South Korea, is considered the largest market for industrial robots. Industrial robots generate a large volume of data, which is used to train robots. This would act as one of the major drivers of the AI market in APAC.
Source: Markets and Markets.
