Revenues for cognitive and artificial intelligence (AI) systems will reach $12.5 billion (+59.3 percent) in 2017 — driven by the US markets, according to IDC.
Spending on cognitive and AI solutions will see significant corporate investment over the next several years, achieving a compound annual growth rate (CAGR) of 54.4 percent through 2020 when revenues will be more than $46 billion.
The IDC report said intelligent applications based on cognitive computing, artificial intelligence, and deep learning are the next wave of technology transforming how consumers and enterprises work, learn, and play.
“These applications are being developed and implemented on cognitive/AI software platforms that offer the tools and capabilities to provide predictions, recommendations, and intelligent assistance through the use of cognitive systems, machine learning, and artificial intelligence,” said David Schubmehl, research director, Cognitive Systems and Content Analytics at IDC.
The largest area of spending in 2017 ($4.5 billion) will be cognitive applications, which includes cognitively-enabled process and industry applications that automatically learn, discover, and make recommendations or predictions.
Cognitive / AI software platforms, which provide the tools and technologies to analyze, organize, access, and provide advisory services based on a range of structured and unstructured information, will see investments of nearly $2.5 billion this year.
Spending on cognitive-related IT and business services will be more than $3.5 billion while dedicated server and storage purchase will total $1.9 billion. Each of these areas will experience strong growth throughout the forecast, led by cognitive applications with a five-year CAGR of 69.6 percent.
Quality Management Investigation and Recommendation Systems; Diagnosis and Treatment Systems; Automated Customer Service Agents; Automated Threat Intelligence and Prevention Systems; and Fraud Analysis and Investigation will deliver nearly half of all cognitive/AI systems spending in 2017.
Slower spending on Diagnosis and Treatment Systems will drop it to the number 5 position. The use cases that will experience the fastest spending growth over the 2015-2020 forecast period are Public Safety and Emergency Response (85.5 percent CAGR) and Pharmaceutical Research and Discovery (74.2 percent CAGR).
Regulated markets such as banking and securities investment services are among the early growth drivers for cognitive and artificial intelligence systems market.
IDC said banking and securities investment services will represent a quarter of worldwide spending on cognitive/AI solutions.
Manufacturing, retail, and healthcare are also expected to make investment in banking and securities investment services.
United States is the largest market for cognitive/AI spending with 2017 revenues totaling nearly $9.7 billion.
Europe, the Middle East and Africa (EMEA) is currently the second largest region.
Asia Pacific (including a 107 percent CAGR in Japan) will move it ahead of EMEA by 2020.