Worldwide revenues for the artificial intelligence (AI) market, including software, hardware and services, is estimated to grow 15.2 per cent (year-over-year) in 2021 to $341.8 billion, according to the International Data Corporation (IDC).
The market is forecast to accelerate further in 2022 with 18.8 per cent growth and remain on track to break the $500 billion mark by 2024.
Among the three technology categories, AI software occupied 88 per cent of the overall AI market.
"However, in terms of growth, AI Hardware is estimated to grow the fastest in the next several years. From 2023 onwards, AI Services is forecast to become the fastest growing category," the report showed.
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In AI Server market, there were a total of six companies that generated over $500 million each in 2020 - Dell, HPE, Huawei, IBM, Inspur, and Lenovo. Together, they held 62 per cent of overall market share.
Meanwhile, in the AI Storage market, Dell, HPE, Hitachi, Huawei, IBM and NetApp achieved over $100 million each in 2020.
Within the AI Software category, AI Applications has the lion's share at nearly 50 per cent of revenues.
In terms of growth, AI Platforms is the strongest with a five-year compound annual growth rate (CAGR) of 33.2 per cent.
"Disruption is unsettling, but it can also serve as a catalyst for innovation and transformation. 2020 was the year that accelerated digital transformation and strengthened the value of enterprise AI," said Ritu Jyoti, group vice president for AI and Automation Research at IDC.
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"We have now entered the domain of AI-augmented work and decision across all the functional areas of a business. Responsible creation and use of AI solutions that can sense, predict, respond, and adapt at speed is an important business imperative," Jyoti said in a statement.
The AI Services market was estimated at $19.4 billion in 2020, representing the fastest growth relative to hardware and software.
For 2021, it is forecast to grow at 19.3 per cent. Over the next five years, it is expected to enjoy the best CAGR at 21 per cent.
"AI has emerged as an essential component of the future enterprise, fueling demand for services partners to help organisations clear the many hurdles standing between pilot projects and enterprise AI," said Jennifer Hamel, research manager, Analytics and Intelligent Automation Services.
