Published on January 10, 2024, 8:12 pm
Generative Artificial Intelligence (AI) technology, including platforms like OpenAI’s ChatGPT and Google’s Bard, has experienced a surge in popularity in recent years. However, it was still a relatively limited market in 2023. A study conducted by Sopra Steria Next, the consultancy arm of the Sopra Steria Group, predicts that this sector is poised for significant growth in the coming years, with an estimated annual growth rate of 66%.
According to the study published on January 10th, major beneficiaries of the first wave of generative AI were infrastructure and hardware providers such as Amazon and Nvidia. Amazon’s AWS cloud computing service and Nvidia’s high-end semiconductors played crucial roles in supporting the development and implementation of generative AI technologies.
Fabrice Asvazadourian, CEO of Sopra Steria Next, drew an interesting parallel between generative AI and the American gold rush phenomenon. He explained that just as shovel-sellers and innkeepers profited greatly during the gold rush while prospectors struggled to strike it rich, cloud providers and graphics processor manufacturers were the main revenue generators in the early days of generative AI.
However, Sopra Steria’s study suggests that this is about to change dramatically. The market for generative AI is expected to grow more than tenfold by 2028, skyrocketing from $8 billion to $100 billion within four years. Asvazadourian believes that 2024 will mark the beginning of an exponential rise in monetizing generative AI.
Several factors are expected to contribute to this takeoff. Firstly, improvements in regulatory frameworks governing AI technology will enhance its reliability and increase public trust. Secondly, there is an anticipation that generative AI will become more useful and versatile for a wide range of businesses, making it an integral part of their operations.
This projected growth aligns with another report by Finbold, which suggests that by 2030, AI-related companies could reach a market share of $1.87 trillion. However, the report also highlights the challenges faced by the sector, particularly surrounding public trust in AI technology. Instances of errors and blunders made by platforms like ChatGPT have affected trust levels and have been a cause for concern.
Despite these challenges, generative AI shows great potential for reshaping various industries and driving significant economic growth. As advancements continue to improve reliability and accuracy, businesses are likely to embrace generative AI as an essential tool in their operations. With the right regulatory framework and increased public trust, generative AI is expected to become a common and valuable asset in the business landscape.