ChatGPT took only 5 days to reach 1 million users. Just a few years back, Instagram and Spotify took 75 days and 150 days, respectively to achieve the same milestone. The global AI market is expected to explode and grow to $320-380 billion by 2027 witnessing a CAGR of 25-35 percent, according to a Nasscom-BCG report.
The report states that GenAI is expected to comprise 33 percent of the global AI market by 2027 while ML and Vision will comprise another 29 percent. In terms of sectors, the financial sector will continue to be the highest contributing followed by media and entertainment.
While India’s AI market is likely to grow on par with the global market with a skew towards the financial sector as the main spender, the tech sector is also expected to increase spending in India over the next few years.
Investments in AI are booming across the globe with $83 billion invested in 2023.
Tech ($58 Bn), banking ($27 Bn) and healthcare ($23 Bn) emerge as the top 3 sectors to receive AI funding globally. While data and analytics remains the highest across regions, GenAI investments are largely skewed towards NAMR currently, with $30 Bn invested in 2 deals (Nuance, OpenAI). India is seeing players emerge, for example, Sarvam.ai raised $40 Mn in Series A.
Read More: Demand for AI talent growing at 15 percent in India: Nasscom BCG report
Disproportionate investments are seen in HR/CRM in Europe and in marketing and advertising solutions in India.
55 percent of investments made by Indian tech products and services investors have been in India itself in the form of strategic bets; Top 3 deals account for 58 percent (Jio investing in Glance, Perfios in Karza, and Infosys in SAFE Life Science) of the investment.
Tech services industry
30 percent of services players have matured to offer advanced AI & GenAI services (e.g., data engineering, AI model finetuning) and are leveraging it to build a growing AI portfolio of business (15 percent of services firms expect to add 20+ clients in the next year)
Services players are using soft launches to gauge & increase client interest; they have been able to leverage unified GenAI platforms to accelerate time to market for newer PoCs from months to weeks.
Over 70 percent services players already have a dedicated and specialist AI head to drive AI initiatives while over 55 percent also have a central CoE with cross-functional governance forums with business, tech and legal participation.
70 percent services players have clearly defined metrics to monitor the progress of AI initiatives and have established a well-defined prioritization framework for directing AI efforts across business impact x feasibility x ability to replicate and scale.
Most of the firms have started to think about their ethical AI policies and have a draft in place, but only 18 percent have comprehensive ethical AI policies with a dedicated senior ethical AI compliance role.
Training and upskilling continues to be the preferential route to attract the right AI talent. However, AI roles and leadership are also seeing accelerated hiring with 70 percent increase in AI engineer and 15 percent increase in key AI leadership roles.