ICT-IOT

Generative AI Market Report Cover

Generative AI Market

Generative AI Market Report Cover

Generative AI Market Size, Share, Growth & Industry Analysis, By Component (Software, Services), By Data Modality (Text, Code, Image, Video, Others), By End User (Media and Entertainment, BFSI, Retail, IT & Telecommunications, Healthcare, Manufacturing, Others) and Regional Analysis, 2024-2031

Author : Antriksh P.


Pages : 120

Base Year : 2023

Release : February 2024

Report ID: KR478


Generative AI Market Size

The global Generative AI Market size was valued at USD 15.95 billion in 2023 and is projected to reach USD 186.33 billion by 2031, growing at a CAGR of 36.60% from 2024 to 2031. In the scope of work, the report includes solutions offered by companies such as OpenAI, Microsoft, Google LLC, IBM Corporation, Amazon Web Services, Inc., Adobe, Synthesia Limited, Baidu, Alibaba Group, Bitonic Technology Labs Inc (Yellow.ai) and Others.

The generative AI market is experiencing robust growth driven by technological advancements and increasing adoption of the technology across various industries. In 2023, the market exhibited a promising scenario with a positive growth outlook. The demand for generative AI solutions has been propelled by the rising need for innovative applications, automation, and enhanced user experiences. Companies are leveraging the technology to streamline processes, create dynamic content, and improve decision-making. The generative AI market is expected to witness significant expansion in the coming years, fueled by the continuous evolution of AI algorithms, increased computing power, and the integration of AI technologies capabilities into diverse sectors, such as healthcare, manufacturing, and entertainment.

Analyst’s Review 

The convergence of AI with other emerging technologies, such as blockchain and IoT, is anticipated to drive innovation and open new avenues for applications. Additionally, the increasing focus on personalized and context-aware generative AI solutions is expected to be a major trend. The generative AI market outlook for the forecast years is optimistic, with a surge in the demand for generative AI products and services across industries. The integration of generative AI models into creative processes, content generation, and decision-making is likely to contribute to the market's sustained growth.

Market Definition

Generative AI, or generative artificial intelligence, refers to a class of algorithms and models designed to generate new, original content autonomously. These systems are capable of creating diverse outputs, ranging from images and text to music and more. The key applications of generative AI span across various industries. In content creation, generative AI models are used to produce realistic images, videos, and text. In healthcare, these models aid in drug discovery and medical image analysis. Other applications include gaming, design, and even virtual prototyping, showcasing the versatility and potential impact of generative AI technologies.

Generative AI Market Dynamics

The expansion of the generative AI market is significantly driven by the growing demand for personalized content. Consumers and businesses alike are increasingly seeking customized and context-aware experiences. generative AI technologies enable the creation of personalized content, whether it is in the form of tailored marketing materials, user interfaces, or product recommendations. This demand is pushing companies to invest in generative AI solutions to enhance customer engagement, drive conversion rates, and stay competitive in an era where personalized experiences are paramount.

The ethical considerations and regulatory frameworks are hampering generative AI market growth. The use of generative AI models in content creation and decision-making raises concerns regarding bias, transparency, and accountability. Governments and regulatory bodies are grappling with establishing guidelines to ensure responsible AI use. Ethical concerns related to deep-fakes and manipulated content further contribute to the restraint, requiring the industry to collaboratively address these issues to foster trust and ensure sustainable growth.

Segmentation Analysis

The global generative AI market is segmented based on component, data modality, end user, and geography.

By Component

Based on component, the market is bifurcated into software and services. The software segment dominated the generative AI market with a share of 67.85% in 2023 due to the widespread adoption of generative AI software across industries. Businesses are increasingly incorporating software solutions to harness the capabilities of generative AI models for content creation, data analysis, and decision support. The ease of integration and customization offered by software applications has propelled their dominance in the market, thereby making them a preferred choice for organizations seeking to leverage generative AI technologies.

By Data Modality

Based on data modality, the market is categorized into text, code, image, video, and others. The code segment is expected to be the fastest-growing region, registering a CAGR of 40.70% over 2024-2031 driven by the rising importance of generative AI code in software development. As organizations prioritize automation and efficiency in coding processes, generative AI code tools have gained significant traction. These tools assist developers in generating code snippets, improving productivity, and reducing errors. The growing emphasis on agile development practices further fuels the demand for generative AI code solutions, supporting the growth of the segment in the generative AI market.

By End User

Based on end user, the market is divided into media and entertainment, BFSI, retail, it & telecommunications, healthcare, manufacturing, and others. The BFSI segment garnered the highest valuation of USD 3.64 billion in 2023, mainly fueled by the increasing adoption of generative AI technologies to enhance financial services. In the BFSI sector, generative AI models are utilized for risk analysis, fraud detection, and personalized customer services. The ability of generative AI solutions to process vast amounts of financial data and provide actionable insights has positioned them as valuable tools for optimizing operations and improving decision-making.

Generative AI Market Regional Analysis

Based on region, the global generative AI market is classified into North America, Europe, Asia Pacific, MEA, and Latin America.

Generative AI Market Size & Share, By Region, 2024-2031

The Asia Pacific Generative AI Market  share stood around 27.84% in 2023 in the global market, with a valuation of USD 4.44 billion, driven by the early adoption of generative AI technologies across industries and the presence of key market players. The region's advanced infrastructure, research and development capabilities, and strong focus on innovation have further contributed to its leadership in the generative AI market. Additionally, increased investments in AI research, supportive government policies, and a thriving startup ecosystem have propelled North America to the forefront of the global generative AI market.

Competitive Landscape

The global generative AI market report will provide valuable insight with an emphasis on the fragmented nature of the industry. Prominent players are focusing on several key business strategies such as partnerships, mergers and acquisitions, product innovations, and joint ventures to expand their product portfolio and increase their market shares across different regions. Expansion & investments are the major strategic initiatives adopted by companies in this sector. Industry players are investing heavily in R&D activities, building new manufacturing facilities, and supply chain optimization.

List of Key Companies in Generative AI Market

  • OpenAI
  • Microsoft
  • Google LLC
  • IBM Corporation
  • Amazon Web Services, Inc.
  • Adobe
  • Synthesia Limited
  • Baidu
  • Alibaba Group
  • Bitonic Technology Labs Inc (Yellow.ai)

Key Industry Developments 

  • July 2023 (Launch): Amazon Web Services announced the preview release of the vector engine for Amazon OpenSearch Serverless. This engine delivered a similarity search feature, simplifying the creation of modern ML-augmented search experiences and generative AI applications in Amazon OpenSearch Serverless.
  • March 2022 (Acquisition): Microsoft successfully acquired Nuance Communications, establishing a collaborative venture. The partnership empowered organizations across sectors to achieve business goals swiftly, thereby leveraging security-focused, cloud-based solutions embedded with potent, vertically optimized artificial intelligence.

The Global Generative AI Market is Segmented as:

By Component

  • Software
  • Services

By Data Modality

  • Text
  • Code
  • Image
  • Video
  • Others

By End User

  • Media and Entertainment
  • BFSI
  • Retail
  • IT & Telecommunications
  • Healthcare
  • Manufacturing
  • Others

By Region

  • North America
    • U.S.
    • Canada
    • Mexico
  • Europe
    • France
    • UK
    • Spain
    • Germany
    • Italy
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • Japan
    • India
    • South Korea
    • Rest of Asia Pacific
  • Middle East & Africa
    • GCC
    • North Africa
    • South Africa
    • Rest of Middle East & Africa
  • Latin America
    • Brazil
    • Argentina
    • Rest of Latin America.
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CUSTOMIZATION OFFERED
  • Check Icon Additional Company Profiles
  • Check Icon Additional Countries
  • Check Icon Cross Segment Analysis
  • Check Icon Regional Market Dynamics
  • Check Icon Country-Level Trend Analysis
  • Check Icon Competitive Landscape Customization
  • Check Icon Extended Forecast Years
  • Check Icon Historical Data Up to 5 Years
Frequently Asked Questions (FAQ's)
The global market is projected to reach USD 186.33 billion by 203, growing at a CAGR of 36.60% from 2024 to 2031.
The global market was valued at USD 15.95 billion in 2023.
The global market is currently experiencing robust growth, driven by technological advancements and increasing adoption across various industries
Top manufacturers of generative AI market are OpenAI, Microsoft, Google LLC, IBM Corporation, Amazon Web Services, Inc., Adobe, Synthesia Limited, Baidu, Alibaba Group, Bitonic Technology Labs Inc (Yellow.ai), and others.
Asia Pacific is expected to be the fastest growing region over the forecast period (2024-2031).
By data modality, text will hold the maximum share in the generative AI market by 2031 with a market revenue of USD 60.83 billion.
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