Artificial Intelligence Services Global Market Opportunities and Strategies to 2033

This report describes and explains the artificial intelligence services market and covers 2018-2023, termed the historic period, and 2023-2028, 2033F termed the forecast period. The report evaluates the market across each region and for the major economies within each region.

The global artificial intelligence services market reached a value of nearly $18.3 billion in 2023, having grown at a compound annual growth rate (CAGR) of 48.8% since 2018. The market is expected to grow from $18.3 billion in 2023 to $131.4 billion in 2028 at a rate of 48.3%. The market is then expected to grow at a CAGR of 41.4% from 2028 and reach $743.2 billion in 2033.

Growth in the historic period resulted from the increased demand for automation, government initiatives and investments and rise in disposable income. Factors that negatively affected growth in the historic period was data privacy and security concerns.

Going forward, increasing use of internet of things (IoT) devices, growing demand for cloud computing, growing digital transformation, strong economic growth in emerging market and rising deployment of 5G network will drive the growth. Factor that could hinder the growth of the artificial intelligence services market in the future include skilled talent shortages.

The artificial intelligence services market is segmented by technology into machine learning, computer vision, natural language processing (NLP) and other technologies. The machine learning market was the largest segment of the artificial intelligence services market segmented by technology, accounting for 43.6% or $8 billion of the total in 2023. Going forward, the natural language processing (NLP) segment is expected to be the fastest growing segment in the artificial intelligence services market segmented by technology, at a CAGR of 57% during 2023-2028.

The artificial intelligence services market is segmented by application type into fraud detection, data analytics & visualization, customer service and management, risk management and compliance & security. The data analytics & visualization market was the largest segment of the artificial intelligence services market segmented by application type, accounting for 26.7% or $4.9 billion of the total in 2023. Going forward, the data analytics & visualization segment is expected to be the fastest growing segment in the artificial intelligence services market segmented by application type, at a CAGR of 57% during 2023-2028.

The artificial intelligence services market is segmented by end-user into banking, financial services and insurance (BFSI), IT & telecom, retail, manufacturing, public sector, energy & utility, healthcare and other end-users. The banking, financial services and insurance (BFSI) market was the largest segment of the artificial intelligence services market segmented by end-user, accounting for 41.2% or $7.6 billion of the total in 2023. Going forward, the retail segment is expected to be the fastest growing segment in the artificial intelligence services market segmented by end-user, at a CAGR of 64.8% during 2023-2028.

The artificial intelligence services market is segmented by services type into managed services and professional services. The professional services market was the largest segment of the artificial intelligence services market segmented by services type, accounting for 55% or $10.1 billion of the total in 2023. Going forward, the managed services segment is expected to be the fastest growing segment in the artificial intelligence services market segmented by services type, at a CAGR of 49.4% during 2023-2028.

The artificial intelligence services market is segmented by software tools into web-based and cloud application programming interface, processing and modeler and archiving and data storage. The web-based and cloud application programming interface market was the largest segment of the artificial intelligence services market segmented by software tools, accounting for 40% or $7.3 billion of the total in 2023. Going forward, the web-based and cloud application programming interface segment is expected to be the fastest growing segment in the artificial intelligence services market segmented by software tools, at a CAGR of 54.9% during 2023-2028.

North America was the largest region in the artificial intelligence services market, accounting for 43.1% or $7.9 billion of the total in 2023. It was followed by Asia Pacific, Western Europe and then the other regions. Going forward, the fastest-growing regions in the artificial intelligence services market will be Asia Pacific and South America where growth will be at CAGRs of 54.3% and 52.1% respectively. These will be followed by Middle East and Eastern Europe where the markets are expected to grow at CAGRs of 51% and 51% respectively.

The global artificial intelligence services market is highly concentrated, with large players operating in the market. The top ten competitors in the market made up to 61.78% of the total market in 2022. IBM was the largest competitor with 10.79% share of the market, followed by Microsoft Corporation with 8.87%, Amazon, Inc. with 6.76%, Accenture Plc with 6.11%, Oracle Corporation with 5.87%, Tata Consultancy Services with 5.59%, Infosys ltd with 4.95%, Fujitsu Limited with 4.58%, Cognizant Technology Solutions Corp with 4.44%, and Hewlett Packard Enterprise with 4.12%.

The top opportunities in the artificial intelligence services market segmented by technology will arise in the machine learning segment, which will gain $35.6 billion of global annual sales by 2028. The top opportunities in the artificial intelligence services market segmented by application type will arise in the fraud detection segment, which will gain $15.5 billion of global annual sales by 2028. The top opportunities in the artificial intelligence services market segmented by end-user will arise in the banking, financial services and insurance (BFSI) segment, which will gain $44.4 billion of global annual sales by 2028. The top opportunities in the artificial intelligence services market segmented by services type will arise in the managed services segment, which will gain $53.1 billion of global annual sales by 2028. The top opportunities in the artificial intelligence services market segmented by software tools will arise in the web-based and cloud application programming interface segment, which will gain $58.1 billion of global annual sales by 2028. The artificial intelligence services market size will gain the most in the USA at $34.4 billion.

Market-trend-based strategies for the artificial intelligence services market include development of enterprise-level AI services to provide tailored solutions, focus on explainable AI for transparency and trust, development of confidential AI services for enhanced data privacy and rising investments to expand services offering.

Player-adopted strategies in the artificial intelligence services market include focus on expanding manufacturing capabilities through strategic acquisitions, strategic investments to advance its AI capabilities and expanding offerings through product launch.

To take advantage of the opportunities, the analyst recommends the artificial intelligence services companies to focus on enterprise-level AI services platforms, focus on explainable AI models, focus on confidential AI services, focus on generative AI innovation, focus on machine learning and computer vision technology segments, focus on managed services, expand in emerging markets, continue to focus on developed markets, provide competitively priced offerings, continue to use B2B promotions and focus on data analytics and visualization and customer service and management application segments and focus on retail and BFSI end-user segments.