CAPITALISING ON THE PROMISE OF AI
GROWTH IN THE AI MARKET IS BEING DRIVEN BY ADVANCEMENTS IN TECHNOLOGY, INCREASED ADOPTION OF AI ACROSS VARIOUS INDUSTRIES, AND THE RISING DEMAND FOR INTELLIGENT DECISION-MAKING SYSTEMS
The global artificial intelligence (AI) market is experiencing significant growth and is expected to continue expanding in the coming years.
The release of generative AI (GenAI) chatbot ChatGPT by OpenAI in November 2022 set many in the world on a path to experimentation and thrust discussions around the promise and future of AI use in society front and centre on many news sites.
Amid recent advancements in technology, AI has evolved from an esoteric research topic into a collection of powerful technologies with mainstream business promise and applicability. Several C-suite executives are using GenAI tools for work, reviewing its use cases and attempting to put in place governance strategies to guard against emerging risks.
The AI market is projected to reach a staggering $407bn by 2027, experiencing substantial growth from its estimated $134.9bn revenue in 2022, according to DeepFest’s Artificial Intelligence - Global and Saudi Arabia Focus 2024 report. GenAI accounted for approximately onefifth of global AI market revenue last year.
Growth in the market is being driven by advancements in technology, increased adoption of AI across various industries, and the rising demand for automation and intelligent decision-making systems. Within the AI market, key segments include machine learning (ML), natural language processing, computer vision, robotics, and AI-as-a-service (AIaaS). These segments are witnessing robust growth as businesses seek to leverage AI capabilities to improve efficiency, enhance customer experiences, and gain competitive advantages.
THE STATE OF AI
Globally, companies across different sectors including financial services, healthcare and manufacturing increasingly regard the development of strong AI capabilities as essential to remaining competitive. National governments, too, are focusing on the economic potential of AI for their countries.
The innovative technology is set to be the key source of transformation, disruption, and competitive advantage in today’s fast-changing economy. DeepFest’s report shows that companies are deploying AI-based solutions, such as robotic process automation (RPA), to improve process workflows and automate repetitive jobs.
AI-based solutions are also being combined with the Internet of Things (IoT). Many multinational companies are collaborating with industry vendors to integrate AI-based IoT into their production processes, which is driving market growth.
Furthermore, industries such as healthcare, finance, retail, manufacturing, and transportation were among those heavily investing in AI technologies to optimise operations, personalise services, and develop innovative products.
ML and cloud-based AI technologies are widely used by financial services firms, according to DeepFest. GenAI is projected to have the biggest impact on the financial services sector, with the banking sector set to generate as much as $340bn in value every year.
AI is also being leveraged by healthcare firms to streamline work processes from illness diagnosis to administrative work. Similarly, autonomous robots and ML-powered predictive analytics enable manufacturers to simplify processes and enhance production.
The increasingly heated GenAI race has sparked excitement and investment in a technology that has the potential to change the world profoundly. Industry experts expect widespread adoption of the technology across the corporate world over the next 12 months, along with rapid progress in the field.
AI IMPACT ON GCC ECONOMIES
GCC countries and businesses are beginning to realise the shift globally towards AI and advanced technologies in the aftermath of the fourth industrial revolution.
The sheer magnitude of AI innovation has immense potential to revolutionise industries in the GCC region including education, healthcare, finance, transportation, communication, and manufacturing.
Strategy& forecasted that the GCC region could realise approximately $9.9 of economic growth for every $1 invested in generative AI (GenAI). This indicates a potential overall economic impact of $23.5bn annually by 2030 in the region.
Saudi Arabia and the UAE are expected to experience the largest impact, with a combined annual growth potential of $17.5bn by the end of the decade.
AI USE CASES IN BUSINESS
With the advent of AI and its applications across the globe, AI is enabling many segments to grow and change the way we envision the future. The demand for AIbased tools and systems has surged on account of fast digitisation in all the major segments of the global economy including banking and finance, healthcare, automobile, and telecommunication. DeepFest said AI is being applied through off-theshelf solutions such as virtual assistants and integrated into existing business operations such as IT processes. The ongoing technological advancements are revolutionising organisations worldwide through automation, accessibility, and diverse use cases.
Banking, high-tech, and life sciences are among the industries that could see the biggest impact as a percentage of their revenues from GenAI. McKinsey analysts said the technology could deliver value equal to an additional $340bn annually if the use cases are fully implemented.
Similarly, AI’s potential impact is also significant in retail and consumer packaged goods and is projected to reach $660bn a year.
Overall, the economic impact of AI is significant and far-reaching, shaping industries, labour markets, and societal dynamics in profound ways. Continued research, investment, and thoughtful policy frameworks are essential to harnessing the potential benefits of AI while mitigating its risks.