Artificial Intelligence as-a-Service (AIaaS) Market Size, Share & Industry Analysis By Component (Solutions, Services), By Enterprise Size (Small and Medium-size enterprises, Large Enterprises), By Industry (Banking, Financial, and Insurance (BFSI), Healthcare and Life Sciences, Retail, Telecommunications) And Regional Forecast, 2024-2032

Artificial intelligence (AI) as a service offers on-demand services to organizations to deploy, manage and develop AI-based models. Prominent market players such as Amazon Web Services, IBM Corporation, Microsoft Corporation, and SAP SE, among others, are offering cloud-based AI services to SMEs and individuals. AIaaS offers advanced capabilities to enterprises such as Sentiment analysis, robots, text recognition, IoT solutions, speech-to-text conversion, augmented reality, and computer vision. 

The lack of IT infrastructure and skilled professionals to develop and implement AI applications across small and medium-sized enterprises (SMEs) is expected to drive the adoption of AI as a service. The increased adoption of digital technologies such as cloud, AI, machine learning, and analytics drives market growth. The ease of access with AI Software Development Kit( SDK) and application programming interfaces(API) and the minimal upfront cost are expected to fuel the market growth.

The AI bots help in financial planning, detecting frauds and cybercrimes, improving bureaucratic efficiency, and offering a customized experience. The growing demand for automation and analytics solutions drives the adoption of artificial intelligence across the industries such as healthcare, manufacturing, retail, logistics, banking, and financial services. Organizations are focusing on implementing artificial intelligence technology. For instance, as per Statista, in 2020, the corporate investment in AI raised to USD 68 Bn across the world.

IMPACT OF COVID-19 ON THE ARTIFICIAL INTELLIGENCE AS-A-SERVICE MARKET

Covid-19 has increased the adoption of cloud and AI for various challenges such as covid-19 virus tracking, vaccine development, contact tracing, telemedicine, and remote work. Further, the shift in consumer behavior and buying patterns drive the adoption of AI solutions across healthcare, retail, and e-commerce to get customer insights and deliver on-demand services. Covid-19 pandemic has accelerated the adoption of AI technology across industries, including manufacturing, healthcare, retail, and financial services.

For instance, as per KPMG 2021 thriving in AI World survey, 93% of business leaders stated AI is moderately or fully functional in industrial manufacturing. Further, 85% stated AI technology is implemented moderately or fully across financial services.

Prominent market players are focusing on product developments and expansion of products to offer cloud AI services to customers.

• For instance, in May 2020, Google Cloud launched an AI solution, Paycheck Protection Program (PPP) Lending Solution, for banking and financial institutions to accelerate the loan applications procedure. The new application includes a web-based loan processing portal, Google cloud’s Document AI PPP parser, and Loan Analytics.

KEY PLAYERS COVERED:

Key players in Artificial Intelligence as a service market include Amazon Web Service, Inc., IBM Corporation, Google LLC, Salesforce, Baidu, Inc., Intel,  Fair Isaac Corporation, SAS Institute, SAP SE, and BigML, Automation Anywhere, Inc.,  among others.

KEY INSIGHTS-

The report will cover the following insights-

• Micro Macro Economic Indicators


• Drivers, Restraints, Opportunities, and Trends


• Impact of Covid-19


• Business Strategies Adopted by Key Players


• Consolidated SWOT Analysis of Key Players

ANALYSIS BY INDUSTRY

Low Infrastructure Cost and Advanced Capabilities of Cloud AI Services Drive the Adoption of AIaaS across BFSI and the Healthcare Industry.

The banking, financial services, and insurance industry witness significant growth during the forecast period. The rising digital transformation across banking and increased proliferation of mobile banking, e-banking, real-time money transfers, and mobile payment applications generate a massive volume of customer data or transaction records. Artificial technology with data analytics enables financial institutions to manage this vast volume of data and generate meaningful insights to deliver a personalized customer experience.

Similarly, AI allows banks and financial institutions to avoid fraudulent transactions and identify anti-money laundering activities, likely to propel market growth. Cloud-based AI services such as AI bots such as chatbots or voice bots, Biometric fraud detection, digital payment advisers, smart wallets, and personalized financial services are likely to foster market growth in coming years. Banking and financial institutions increased the adoption of advanced technologies such as AI, cloud, and machine learning.

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  • For instance, in September 2021, IBM Corporation partnered with CaixaBank to boost the digital capabilities of the enterprise. With this partnership, IBM to deliver AI and hybrid cloud solutions to CaixaBank to improve business efficiency and digital experience.
  
  
  
  

The growing adoption of digital technologies across healthcare owing to the covid-19 outbreak is expected to showcase remarkable market growth. The AI technology helps healthcare organizations manage the workforce, analyze patient records, detect medication errors, and improve the patient experience with conversational AI. Such features of AI and low infrastructure and implementation costs drive the adoption of AIaaS across the industry. The market players are investing in developing new cloud AI solutions amid the pandemic.

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  • For instance, in November 2020, Google Cloud launched artificial intelligence tools, AutoML Entity Extraction for Healthcare and Healthcare Natural Language API for life science and healthcare to manage unstructured text.
  
  
  
  

Such rising innovations and investment in developing advanced solutions are projected to drive market growth.

REGIONAL ANALYSIS-

North America is expected to hold a significant market share in the artificial intelligence as-a-service market. The rising investment in innovation and product development by US companies such as Intel Capital, Y Combinator, and 500 Startups across the region drives the market growth. For instance, in October 2020, Statista stated that funding or investment for AI-focused companies extended to USD 4.7 billion in the US. Such growing investments/funding for technology innovation is likely to fuel the market growth.

The increased adoption of AI technology across public services, healthcare, education, and transportation across the United States is expected to drive market growth. North America holds the most AI patent publications, which is projected to contribute to the region's dominance in the AIaaS market. Thus, rapid adoption and deployment of emerging technologies and increased proliferation of smart devices will likely foster market growth. The prominent market players such as Microsoft Corporation, Amazon Web Services, Google LLC, IBM Corporation, and SAP SE, among others, are focusing on partnerships, collaborations, mergers, product launches, or expansion.

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  • For instance, in February 2021, BAE Systems collaborated with Amazon Web Services(AWS) to offer data labeling as a service and artificial intelligence capabilities to GovCloud(United States) on the AWS marketplace for national security missions.
  
  
  
  

Such growing adoption of cloud and AI technology solutions and investment to implement advanced technology capabilities is expected to drive the market growth in this region.

Segmentation

KEY RECENT DEVELOPMENTS-

• In July 2019- SAP SE and Google LLC partnered to transform business operation to cloud with its machine learning and artificial intelligence capabilities. SAP customers can leverage SAP products and services with this partnership, including SAP Data Warehouse Cloud solutions and SAP Analytics Cloud on Google Cloud’s infrastructure and network.


• In March 2021- Infosys partnered with LivePerson, Inc., a Conversational cloud and AI solution provider, to drive customer experience. The partnership enables businesses to manage conversations with customers and employees with websites, apps, SMS via LivePerson Conversational Cloud and Infosys Cobalt.