The global artificial intelligence in IoT market size was valued at USD 1,581 million in 2021. It is expected to reach USD 11,774 million by 2030, growing at a CAGR of 28.53% during the forecast period (2022–2030). Artificial intelligence (AI) is the simulation of human intellectual functions by machines, particularly computer systems, and is frequently applied to speech recognition, machine learning, and machine vision. A system of interconnected computing devices, mechanical and digital machines, or other items having unique IDs and the capacity to communicate data across a network without requiring human-to-human or human-to-computer interaction is known as the Internet of Things (IoT).
Using AI, IoT builds sophisticated machines that mimic human behavior and assist in making decisions with little to no human input. IoT technology is the foundation for different enterprises to undergo a digital transformation, enabling them to improve current operations by developing and monitoring new business models. IoT has been viewed as the primary enabler to boost digital transformation and uncover operational efficiencies by businesses and service providers.
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Rising Big Data Volume
The growth of big data, along with the quickly rising volume and complexity of data, is being driven by the expanding mobile traffic, cloud computing traffic, and the development and use of technologies like IoT and AI. Big data analytics are an effective method of delivering data, providing insightful and practical knowledge from massive amounts of data. Organizations can profit from sizeable predictive analytics in several ways, including operations, marketing, risk assessment, and raid detection. For example, in a study in 2020, about 90% of business professionals and enterprise analytics mentioned that data and analytics are critical to their organization's digital transformation initiatives. Data and analytics are increasingly becoming key components for enterprises.
Need for Effective Data Management
Businesses can better understand and use trends by using data generated through IoT, which is then incorporated into the decision-making process to improve product design and development. Data management practices allow these firms to identify faults, evaluate performance, and quickly obtain measurements. All of these provide perceptions into how products are used, which help identify areas needing improvement and enhance current product versions.
Numerous IoT devices increase the surface area of a network, increasing the number of potential attack vectors. AIoT could launch an active attack on a network from a single connected, unprotected device. Attacks on vital infrastructure in industrial space might cause enormous losses. Therefore, hindering the growth of the market.
The global artificial intelligence in the IoT market is segmented by component, end-user, and region.
Component-wise, the global artificial intelligence in IoT market includes Platforms, Services, and Software.
The Software segment is the largest shareholder in the market and is expected to grow at a CAGR of 27.89% during the forecast period. It is further sub-segmented into Data Management, Network Bandwidth Management, Real-time Streaming Analytics, Remote Monitoring, Security, and Edge Solutions. Among these segments, data management acquires a significant share of the market. IoT data management is frequently used to forecast wear and tear on connected assets and infrastructure.
The Platform segment is sub-segmented into Application Management, Connectivity Management, and Device Management. Application management occupies a significant share and includes application functionality, upgrades, and version control. It improves organizations to make better decisions efficiently and effectively.
End-user-wise, the global artificial intelligence in IoT market includes Banking, Financial Services, & Insurance, IT & Telecom, Energy & Utilities, Healthcare, Manufacturing, and Others.
Manufacturing holds the largest market share and is expected to grow at a CAGR of 28.43% during the forecast period. Manufacturers are working harder than ever to develop fully automated data management solutions. Manufacturing IoT systems with AI capabilities can effectively handle production quality control, monitoring and optimizing equipment performance, and human-to-machine communication. Significantly shorter product cycles are possible because of more rapid and effective supply chain and production processes. The objective is to address common industrial difficulties while greatly accelerating future Industrial IoT advancements, reducing time to value, and driving production efficiencies. The underlying platform will continue to develop to embrace new technologies, such as those in analytics, artificial intelligence, and digital feedback loops, by production requirements.
The Banking, Financial Services, & Insurance industries use AI-based IoT solutions primarily for fraud detection, product development, insurance processing, and operations. Technologies based on artificial intelligence (AI) have the potential to change the BFSI sector significantly. These businesses' implementation of AIoT can help them achieve goals like increasing customer experience, cost and efficiency optimization, providing personalized service, and accelerating the time to market for new products. AIoT is typically utilized in the banking industry for ATM fraud detection and other unlawful actions. To identify fraudulent ATM activity and report them right away to the bank's security staff or even law enforcement agencies, companies like IGZY built their IoT sensors or cameras.
North America Reigns Supremacy Over Others
Region-wise, the global artificial intelligence in IoT market is analyzed across North America, Europe, Asia-Pacific, the Middle East and Africa, and South America.
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North America commands the largest market share and is expected to grow at a CAGR of 27.5% during the forecast period. North America is one of the primary markets for AI and IoT. One of the factors supporting the expansion of the market in this region is the widespread use of both technologies in various sectors, including manufacturing, retail, healthcare, automotive and transportation, and others. It is one of the top regions for research into creating IoT and AI applications for new end-use sectors. The region has been at the forefront of the transformation that has seen autos become more and more software-oriented, owing to the high-tech ecosystem the nation has established. IoT devices may evaluate data, make judgments, and take action on those conclusions without human intervention when AI is combined with IoT. One example of how AI and IoT might function together is in self-driving automobiles like those made by Tesla. Self-driving cars can now make predictions about the actions of other vehicles and people under different conditions because of AI.
Asia-Pacific is the second-largest region in the market and is estimated to account for USD 6,653 million by 2030, growing at a CAGR of 29.25%. Technological innovations like AI and IoT have been widely adopted throughout Asia-Pacific. Due to the difficulty in rebuilding existing automation systems and machine investments, the market in the region's developing nations has a significant advantage in implementing industrial automation. IoT spending is heavily concentrated in Asia-Pacific, with South Korea and Singapore predicted to be among the top countries worldwide. The Organization for Economic Cooperation and Development reports that South Korea has the most internet-connected items per habitat internationally. Asia-Pacific has a significant manufacturing sector. As a substantial contributor to the global economy, China's economy is rapidly changing due to rising labor prices and the unsustainable nature of the traditional migrant worker model. These trends have forced the economy to incorporate automation into its industrial procedures.
The industries anticipated to adopt IoT in Europe include transportation, healthcare, housing and hospitality, manufacturing, and retail. As IoT adds value to these industries, demand for the invention of IoT chips and the modernization of already-existing chip-based technologies would rise. The adoption of IoT in the European automotive industry is fueled by substantial financial investments made by well-known vendors and a growing interest in solutions for improving fuel economy and traffic safety. IoT penetration is generally relatively high in Sweden, France, Italy, Germany, and Luxembourg. These nations' automobile industries are embracing IoT technology quickly as well.
List of key artificial intelligence in iot market companies profiled