AI in IoT Market Size to Worth USD 153.08 Bn by 2033

Prathamesh

9 months ago

The global AI in IoT market size is expected to increase USD 153.08 billion by 2033 from USD 82.24 billion in 2023 with a CAGR of 6.41% between 2024 and 2033.

Key Points

The North America AI in IoT market size reached USD 27.14 billion in 2023 and is expected to attain around USD 51.28 billion by 2033, poised to grow at a CAGR of 6.56% between 2024 and 2033.
North America dominated the global AI in IoT market in 2023.
Asia Pacific is anticipated to witness the fastest growth over the studied period.
By component, the software segment dominated the global market in 2023.
By component, the platform segment is expected to grow at a significant rate in the market during the projected period.
By end-user, in 2023, the manufacturing segment led the market in 2023.
By end-user, the banking, financial services, & insurance segment is expected to grow at a significant rate during the forecast period.

The AI in IoT market represents the convergence of artificial intelligence (AI) technologies with the Internet of Things (IoT) infrastructure. It involves integrating AI capabilities such as machine learning, natural language processing, and computer vision into IoT devices and platforms to enhance automation, decision-making, and operational efficiency across various industries.

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Growth Factors

Several factors are driving the growth of AI in IoT, including advancements in AI algorithms and IoT sensors, increasing demand for real-time data analysis and predictive maintenance, and the proliferation of connected devices. Additionally, the push towards autonomous systems and smart cities is accelerating adoption.

AI in IoT Market Trends

Edge Computing Adoption: AI algorithms are increasingly being integrated at the edge of IoT networks to process data locally. This reduces latency, improves response times, and enhances data privacy.
Predictive Maintenance: AI-powered IoT solutions are enabling predictive maintenance by analyzing real-time data from connected devices. This helps in identifying equipment failures before they occur, minimizing downtime, and reducing maintenance costs.
Enhanced Security: AI is being leveraged to strengthen IoT security by detecting anomalies in device behavior and network traffic patterns. This proactive approach helps in mitigating potential cyber threats.
AI-driven Automation: IoT devices are becoming smarter with AI, enabling autonomous decision-making and actions based on data insights. This automation enhances operational efficiency across various industries.
Integration with 5G: The rollout of 5G networks is facilitating faster data transfer and lower latency, enabling more real-time AI processing in IoT applications. This combination is driving innovations in smart cities, connected vehicles, and industrial IoT.
Personalized User Experiences: AI algorithms are used to analyze user behavior and preferences gathered from IoT devices. This data helps in offering personalized services and improving user experiences in smart homes, healthcare, and retail environments.

Region Insights

The adoption of AI in IoT is widespread globally, with regions like North America, Europe, and Asia-Pacific leading in terms of technological advancements and market penetration. North America, particularly the United States, dominates due to robust infrastructure and early adoption by industries such as healthcare, manufacturing, and transportation.

AI in IoT Market Scope

Report Coverage	Details
Market Size by 2033	USD 153.08 Billion
Market Size in 2023	USD 82.24 Billion
Market Size in 2024	USD 87.51 Billion
Market Growth Rate from 2024 to 2033	CAGR of 6.41%
Largest Market	North America
Base Year	2023
Forecast Period	2024 to 2033
Segments Covered	Component, End-user, and Regions
Regions Covered	North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa

AI in IoT Market Dynamics

Drivers:

Key drivers include the need for operational efficiency, cost reduction through predictive maintenance, enhanced customer experience through personalized services, and regulatory requirements for data security and privacy.

Opportunities:

Opportunities abound in sectors such as healthcare for remote patient monitoring, smart manufacturing for predictive maintenance and quality control, smart homes for energy management, and transportation for fleet management and autonomous vehicles. The integration of AI in IoT presents new revenue streams for solution providers and technology integrators.

Challenges:

Challenges include interoperability issues among diverse IoT devices and platforms, concerns over data privacy and security, complexity in integrating AI algorithms with IoT infrastructure, and the need for skilled AI and IoT professionals. Regulatory compliance and ethical considerations regarding AI deployment also pose challenges that need to be addressed for sustainable growth.

AI in IoT Market Companies

Google LLC
SAP SE
PTC Inc.
Salesforce, Inc.
Hitachi Ltd.
Softweb Solutions Inc.
Amazon Web Services Inc.
IBM Corporation
SAS Institute Inc.
Oracle Corporation
Other Key Players

Recent Developments

In March 2024, Accenture launched the Accenture LearnVantage service to assist clients with a comprehensive technology learning and training service and achieve greater business value with the help of AI-based IoT systems.
In January 2024, Vodafone and Microsoft signed a ten-year strategic partnership to develop AI-based IoT and other digital services as Vodafone has tried to scale its new standalone IoT business with Microsoft.
In March 2023, Accenture announced its acquisition of Flutura, a provider of data science and IoT services. This strategic move aims to bolster Accenture’s industrial AI services under its Applied Intelligence brand.
In April 2022, Synaptic launched its edge AI evaluation kit (EVK), which utilizes the capabilities of its Katana system-on-a-chip (SoC) by building a human recognition, sound, and motion detection system for improving biometrics and other AI applications at the edge of the networks. Within this technology, the company is addressing different problems, such as power consumption and size constraints for edge semiconductors.
In April 2022, Gupshup acquired Active.Ai, a startup that provides conversational AI to fintech firms and banks in all-cash transactions. The acquisition may enable Gupshup to offer better customer experience solutions for the BFSI market.

Segments Covered in the Report

By Component