AI Market Predicted to Pass $300 Billion in Five Years

New report suggests that the combination of AI and IoT will be a heavy driver of growth.

The global AI market is expected to be worth $301.2 billion by 2028, according to a February 2023 report by Research and Markets. The report predicts that the market will grow at 29.4 percent CAGR, with the combination of AI and IoT alone driving up to 27 percent of new AI systems integration.

The report found that most companies are currently focused on siloed approaches to AI solutions, and suggests that this will shift to more integration with key areas such as IoT and data analytics.

AI Today and Tomorrow

McKinsey’s 2022 Global Survey on AI found that in the last five years, organizations have begun using AI in more ways and across more business units. The survey revealed that the top three uses of AI are robotic process automation, computer vision and natural-language text understanding.

The survey further found that popular use cases for AI include service operations, which has occupied the top spot since 2018; marketing and sales, like customer service analytics; and risk, including risk modeling and analytics. Organizations reported the biggest revenue effects for AI in marketing and sales, product and service development, and strategy and corporate finance. The highest cost benefits from AI were in supply chain management.

One of the most volatile and significant factors driving the development and demand for AI is the COVID-19 pandemic. The Research and Markets report draws out cybersecurity as an example to explain potential growth in AI. The pandemic heightened the global need for cybersecurity.

The increase in remote work has led to a rise in cyberattacks on home-based workers. AI has the potential to assist cybersecurity by identifying malware. It is easy to use and relatively inexpensive to maintain as AI-based security looks for malicious behaviors rather than reviewing new malware code.

The Research and Markets report predicts that in the long-term, AI will move beyond fraud prevention and preventing malicious acts like stealing sensitive data. AI could develop the potential to mine programs for data to complete advanced analyses and make decisions. This will help IoT devices combine real-time data with AI so the devices can operate autonomously.