|Study Period:||2019- 2026|
|Fastest Growing Market:||Asia Pacific|
|Largest Market:||North America|
Need a report that reflects how COVID-19 has impacted this market and its growth?
The global Artificial Intelligence-as-a-Service market was valued at USD 3.91 billion in 2020. It is expected to reach USD 43.29 billion by 2026, registering a CAGR of 48.9% during the period of 2021-2026. The outbreak of the COVID-19 pandemic has significantly affected several industries and markets globally. Pandemic has overwhelmed customer service departments. It has impacted the customer experience, made callers less patient, and stressed many call center agents. The demand for AI Infrastructure as a service has been gaining traction during the pandemic. AI and genomic studies are one essential tool in combating the pandemic.
- With the increasing number of enterprises and competition, companies are rigorously trying to integrate artificial intelligence (AI) technology into their application, business, analytics, and services.
- Moreover, companies are trying to reduce their operational cost to increase profit margins, due to which Artificial Intelligence-as-a-Service (AIaaS) is gaining more prominence over the cloud. Notably, companies are more interested in cloud-based machine learning, which helps in experimenting with their offerings.
- The rising trend of multi-cloud functioning and the growing need for cloud-based intelligence services are also increasing the demand for AI as a service. According to IBM, by 2021, 98% of the organization's plan will adopt multi-cloud architectures, with only 41% having a multi-cloud management strategy and just 38% having procedures and tools to operate a multi-cloud environment. This creates a massive opportunity for AI services.
- Many government organizations, especially in emerging economies, also understand the benefits and power of AI; hence, they are extensively promoting AI-based infrastructure development. For instance, Niti Aayog in India launched a national program on AI, including R&D, with increased budget allocation for Digital India, to promote AI, machine learning, 3D printing, and other technologies.
- In addition, the companies are launching services associated with testing AI services. For instance, in April 2019, Google Cloud Platform started offering AI creators a new, shared, end-to-end environment for teams to test, train, and deploy models called the AI Platform. The company also upgraded its AutoML, a service for automating the creation of custom AI models.
Scope of the Report
Artificial Intelligence-as-a-Service (AIaaS) accounts as a third-party offering to outsource artificial intelligence. It allows companies or end-users to experiment with AI across various purposes by limiting the initial investment and lowering risk. The market is segmented as follows:
|Small and Medium Enterprise|
|IT and Telecom|
|Other End-user Industries|
|Middle East and Africa|
Key Market Trends
BFSI is Expected to Occupy the Highest Share
- In recent years, AI technology has been increasingly adopted in the BFSI industry to enhance operational efficiency and enable a rich consumer experience. AI is at the forefront of all innovations and will continue to remain so in 2020.
- In the BFSI industry, AI is mainly used as chatbots, algorithmic trading, fraud detection, and customer recommendation. Banks, such as RBS, are implementing chatbots, likely to compel other financial institutions to invest in similar technology. As a result, it is expected to create demand for AI-based solutions, which, in turn, is expected to boost the investment by the industry players, thereby fostering market growth over the next six years.
- AI in finance can act as a powerful ally in analyzing real-time activities in any environment. The accurate predictions and forecasts that it provides are based on multiple variables, vital to business planning. For instance, a United States leasing company, Crest Financial, used artificial intelligence on the Amazon Web Services platform and immediately saw a significant improvement in risk analysis without facing any deployment delays associated with traditional data science methods.
- Artificial Intelligence can also provide a faster, more accurate, and unbiased assessment of a potential borrower, at a lower cost, by accounting for a wider variety of factors, which leads to a better-informed, data-backed decision. For example, automobile lending companies in the United States have reported success with AI for their lending activities. A report by Zest Finance shows that atop auto lenders in the US cut losses by 23% annually, bringing AI on board.
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Asia Pacific is Expected to Witness the Highest Growth
- The global investment in artificial intelligence is rapidly increasing, primarily in the Asia-Pacific region. Furthermore, the healthcare industry in Asia-Pacific countries, such as India, is quickly expanding. Due to this, the scope and demand for artificial intelligence in the industry are increasing. As a result, the region is expected to have a substantial investment opportunity, thereby boosting the market growth over the forecast period.
- Notably, the top tech giants worldwide, offering AI services, are opening research labs in the Asia Pacific region, which is expected to ascend employment and tap more potential consumers.
- Emerging countries, like India and Taiwan, are heavily investing in adopting new AI-based services or models, further expanding the application scope of the studied market. According to Business Next, in Taiwan, startups are developing AI-inspired software that calculates the best times to clean solar panels, increasing power generation by more than 15%.The global investment in artificial intelligence is rapidly increasing, primarily in the Asia-Pacific region.
- Emerging countries, like India and Taiwan, are heavily investing in adopting new AI-based services or models, further expanding the application scope of the studied market. According to Business Next, in Taiwan, startups are developing AI-inspired software that calculates the best times to clean solar panels, increasing power generation by more than 15%.
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The Artificial Intelligence-as-a-Service market is fragmented, with most companies focusing on a silo approach to developing solutions. Going forward, AI will be increasingly embedded within many systems and applications in everything from data management to retail shopping. The fragmented market has a vast number of players who have been making efforts to increase its market footprint by concentrating on product diversification and development. Some of the recent developments in the market are:
- June 2020 - H2O.ai, the prominent open-source vendor in artificial intelligence (AI), announced the availability of H2O Driverless AI integration, a leading automatic machine learning platform, with Snowflake, the Cloud Data Platform. This new integration enables Snowflake users to build and deploy ML models quickly. Driverless AI automates the demanding and time-consuming machine learning and data science workflows, such as feature model tuning, engineering, and model selection, to gain the highest predictive accuracy within the shortest time.
- October 2020 - IBM Corporation announced new capabilities in IBM Maximo for Civil Infrastructure to help prolong the lifespan of aging bridges, tunnels, highways, and railways. Further enhancements include the ability to deploy on Red Hat OpenShift for hybrid cloud environments and new AI and 3D model annotation tools that can provide deep industry and task-specific insights to support engineers. Tools like AI, predictive maintenance, drones, and hybrid cloud, will play an essential role in meeting the challenge of rising infrastructure costs and helping these vital structures endure for future generations.
- October 2020 - Amazon Web Services (AWS) and Carrier Global Corporation, a leading global provider of healthy, safe, and sustainable building and cold chain solutions, announced a multi-year agreement to co-develop Carrier’s new Lynx digital platform. This suite of tools will provide Carrier customers worldwide with enhanced visibility, increased connectivity, and actionable intelligence across their cold chain operations to improve outcomes for temperature-sensitive cargo, including food, medicine, and vaccines.
Table of Contents
1.1 Study Assumptions &and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Overview
4.2 Industry Attractiveness - Porter's Five Forces Analysis
4.2.1 Bargaining Power of Suppliers
4.2.2 Bargaining Power of Consumers
4.2.3 Threat of New Entrants
4.2.4 Intensity of Competitive Rivalry
4.2.5 Threat of Substitute Products
4.3 Industry Value Chain Analysis
4.4 Assessment of Impact of COVID-19 on the Industry
4.5 Market Drivers
4.5.1 Increasing Demand for Predictive and Analytics Solutions
4.5.2 Rising Demand for Enhancing Consumer Experience
4.6 Market Challenges
4.6.1 Risks Associated with Data Breaches and Hacks
5. MARKET SEGMENTATION
5.2 Organization Size
5.2.1 Small and Medium Enterprise
5.2.2 Large Enterprise
5.3 End-user Industry
5.3.4 IT and Telecom
5.3.7 Other End-user Industries
5.4.1 North America
5.4.3 Asia Pacific
5.4.4 Latin America
5.4.5 Middle East and Africa
6. COMPETITIVE LANDSCAPE
*List Not Exhaustive
6.1 Company Profiles
6.1.1 Microsoft Corporation
6.1.2 Google LLC
6.1.3 Amazon Web Services, Inc.
6.1.4 IBM Corporation
6.1.5 BigML Inc
6.1.6 DATAIKU SAS
6.1.7 Salesforce.com Inc.
6.1.8 SAS Institute Inc
6.1.9 Oracle Corporation
6.1.10 H2O.Ai Inc
7. INVESTMENT ANALYSIS
8. MARKET OPPORTUNITIES AND FUTURE TRENDS
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Frequently Asked Questions
What is the study period of this market?
The AI-as-a-Service Market market is studied from 2019 - 2026.
What is the growth rate of AI-as-a-Service Market?
The AI-as-a-Service Market is growing at a CAGR of 48.9% over the next 5 years.
Which region has highest growth rate in AI-as-a-Service Market?
Asia Pacific is growing at the highest CAGR over 2021- 2026.
Which region has largest share in AI-as-a-Service Market?
North America holds highest share in 2020.
Who are the key players in AI-as-a-Service Market?
Microsoft Corporation, Google LLC, Amazon Web Services Inc., IBM Corporation, salesforce.com, inc. are the major companies operating in AI-as-a-Service Market.