IDC estimated that Generative AI market is poised to expand by US$3 billion by 2027 within Asia Pacific.
Heaptalk, Jakarta — Artificial Intelligence (AI) spending in the Asia Pacific region, including software, services, and hardware for AI-centric, is projected to enhance to US$78.4 billion in 2027.
According to the latest lDC’s Worldwide AI Spending Guide, the increase in AI spending reflects a transformation toward leveraging cutting-edge technology to reimagine operations, improve customer experience, and maintain a competitive edge in a rapidly changing market, with an estimated CAGR of 25.5% for 2022 – 2027.
With a market share of 28.5% this year, the professional services industry is considered the most dominant sector in implementing AI technology, with a CAGR enhancement of 22.4% in 2022 – 2027. This industry has invested its expenses into AI Infrastructure Provisioning, in which infrastructure service providers create and manage the IT infrastructure for AI systems. This measure also enables end users to gain access to these resources required for computing and storage for AI system development or the provision of AI services.
In the banking industry, AI has revolutionized customer experiences through personalized financial recommendations and efficiently detecting fraudulent activity or the increased risk of fraud. The industry’s investment in AI-driven algorithms ensures secure transactions and fulfills consumer needs to narrow down the best options and make better decisions.
“Generative AI has obtained a huge momentum in the dynamic landscape of AI evolution. Most of the organizations in this region have commenced investing in Generative AI (GenAI) and continue to navigate its potential this year,” said IDC’s Senior Market Analyst, IT Spending Guides, Customer Insights and Analysis in Asia Pacific Vinayaka Venkatesh.
Nevertheless, Venkatesh mentioned multiple challenges that companies frequently encountered while exploring GenAI, spanning trustworthiness, privacy, security, copyright, and discovering a suitable business partner. However, he admitted that the maturity of technology could overcome these issues.
Markets’ Contribution to Adopting AI
In this cycle, IDC’s prediction of GenAI market demonstrated an expansion of US$3 billion by 2027 within Asia Pacific. This projection enables multiple parties to recognize the growth of AI utilization even though spending is currently diminutive. The report revealed that use cases will diversify and become more tailored to specific applications as this technology evolves.
Despite the enormous expenses of this technology, the report also disclosed that multiple markets have contributed considerably to adopting AI. China continues to be the leader in AI implementation in Asia Pacific regarding AI spending, accounting for 50% of this region’s total AI technology spending. The output is estimated to reach nearly US$38.4 billion by 2027.
The Asia Pacific region, excluding Japan and China, is emerging as a vibrant hub of AI innovation, contributing 34% of total AI spending in the area, and is projected to evolve by 26.8% to nearly US$28.2 billion by 2027. As is well known, the report explained that several markets have led the AI implementation, such as India, Australia, and Korea. This technology adoption in these countries has enhanced the economy, digital transformation, and digital leadership.
Japan is the third-highest investing region in AI, with a US$ billion investment expected by 2027, growing at a CAGR of 25%. This advanced technology is being adopted by Japanese industries to improve productivity, quality control, risk management, and customer experiences, thereby driving economic growth and technological leadership.
