The artificial intelligence (AI) service market will expand 47% over the next five years, with growing demand for smart homes and the development of smart cities playing key roles, according to a report from Technavio.
The artificial intelligence (AI) service market will expand 47% over the next five years, with growing demand for smart homes and the development of smart cities playing key roles, according to a report from Technavio.
The concept of smart homes is growing as consumer needs are changing and they are focusing more on convenience with the help of connected devices.
A key factor driving the growth of the AI as-a-service (AIaaS) market is the use of advanced infrastructure at reduced costs. In other words, with gradual improvement made to make hardware devices smart, more advanced software is also required. That is where AIaaS comes in.
Smart home technologies use advanced sensors that are affordable and are used by households to connect appliances such as air conditioning units, camera systems, computers, entertainment systems, heating modules, lighting systems and security devices. Homeowners control these devices using AIaaS to schedule the running time for energy management purpose.
AIaaS plays a critical role in making transportation smart, optimizing urban planning and making cities safe. The AIaaS platform helps to track citizens’ habits, behavioral characteristics and activities. As such, the increase in demand for smart homes and the development of smart cities will lead to the rise in demand for AIaaS during the forecast period.
Businesses are also using AI to help with their operations, especially for IT professional services. “Some other factors boosting the global market are lack of skilled workforce encouraging enterprises to shift towards AIaaS and the use of AIaaS for human interaction with machines using natural language processing,” says the Technavio report.
With the adoption of Al, enterprises are expected to have long-term benefits in terms of efficiency, productivity and reduced costs. Also, an Al database is designed to store data indefinitely. However, the development of Al requires great investment for hardware such as sensors and software.
In addition to the set-up cost of Al, maintenance and repair costs also add to the burden to companies planning to implement AI in their businesses.
Companies using Al in their business operations should also be able to recover lost codes when needed. In order to do so, these enterprises have to invest in additional resources such as Al professionals to maintain their systems. This adds to the cost of implementing and maintaining Al. To avoid these costs, enterprises will outsource these tasks to AIaaS providers, thereby fueling the demand.
According to Technavio, the Americas led the AIaaS market in 2018 with a market share of close to 39%, followed by Europe, the Middle East and Africa and Asia Pacific. However, Asia Pacific is expected to register the highest incremental growth, supported by the growing AI adoption in industries and rising investment by governments in countries like India, where smart home adoption continues to grow.