The Evolution of the AI ​​as a Service (AIaaS) Market

Artificial Intelligence as a Service (AIaaS) refers to the use of machine learning algorithms, robotic process automation (RPA) to natural language processing (NLP) in the cloud to automate business processes. In this respect, it is similar to software as a service (SaaS). However, AIaaS allows business users to access AI models without requiring advanced AI programming skills.

This blog shares projected growth metrics of the AI ​​business including by deployment model, end-user application, vertical, and geography. After taking a look at what the future holds for you, businesses will be able to:

  • Create regional and country-specific strategies based on facts and figures.
  • Determine where and when to invest.
  • Outperform key competitors using data and the driving forces and trends that shape the market.
  • Understand customers based on the latest market research results.
  • Grow your Business by positioning yourself strategically in technology operations.

As a result, building a separate AI solution for these various small services will not make much sense for companies as they all involve significant upfront and management costs, which can sometimes be difficult. when it’s not easy for new entrants.

This is why businesses often look for AIaaS (Artificial Intelligent-as-a-Service).

Today, we will talk about AI as a Service (AIaaS) Marketplace. What will the market growth rate and CAGR be? What are the key players in this market, and what are their business models? Why is the market growing? And we will answer many more such questions here.

What is AIaaS?

AIaaS stands for Artificial Intelligence-as-a-Service. It refers to the available artificial intelligence tools that help companies scale production and implement AI techniques in their models at a fraction of the in-house AI costs.

As we can get insights from our discussions, AI is referred to as a broad field encompassing many technologies, including NLP (Natural Language Processing), robotics, machine learning and computer vision.

The evolution of AI as a service:

The global AI as a service market was valued at USD 1.35 billion in 2016 and is estimated to reach USD 43.1 billion by 2028, at a CAGR of 46.9% during the forecast period. The base year considered for the study is 2017, while the forecast period is from 2018 to 2028.

The forecasted compound annual growth rate (CAGR) to 2028 of different categories of AI market are:

  • AI Services- 22%
  • Hardware AI- 20.5%
  • AI Platform- 34.6%
  • AI system infrastructure software- 14.1%
  • AI lifecycle software- 38.9%
  • Business Services AI- 21.9%

The market has been segmented into cloud-based and on-premises deployment models based on the deployment model.

inside global artificial intelligence As a services market, the US is dominating in terms of revenue and is expected to maintain its dominance in the coming years. In addition, the US is primarily a developed economy, which means that the large number of small and medium-sized enterprises (SMEs) in the country make it an attractive market for AI as a powerhouse. Service Provider.

There are a wide range of AI applications that businesses are looking to implement in their model, such as chatboxes, text analytics software, and many more. These will help simplify tasks for which they have no expertise, devoting their time and efforts to goals that are more important to achieving their goals.

Market statistics for AI-As-A-Service:

AIaaS is a third-party provider to outsource AI services to organizations exploring different areas of artificial intelligence without investing large amounts of money with higher risks. Large companies like Microsoft, IBM, Google and other market leaders have actively introduced AI services in their business models, which help increase reach and revenue without investment. a lot of time. Furthermore, large investments in the application of technological advancements and artificial intelligence have led to an increase in demand for advanced analytics systems in the market, contributing to the growth of the System. AIaaS market statistics.

The increasing awareness of the benefits of cloud-based solutions and the demands of affordable artificial intelligence professionals has driven the growth of the AIaaS market. Let’s explore AIaaS market growth based on segmentation and competitive analysis:

Global market for Artificial Intelligence as a Service is segmented by organization size, technology, region, and vertical. The technology segment is divided into computer vision, machine learning, NLP, and others. Machine Learning has the largest market share in 2017, dominating the market with increasing revenue and is expected to remain flat in the coming years.

Based on the size of the EnterpriseThe AIaaS market is divided into two regions, small and medium enterprises and large enterprises. Large enterprises gained their share in the AI ​​field in 2017, leading to pressure on other companies and increasing demand for AI in other end-user industries.

Define it growth from a vertical perspective, the market is segmented into retail, telecommunications, healthcare, IT, public sector, manufacturing, energy, and utilities. The telecom and IT sectors have dominated the AIaaS market, incorporating chatbots and other features in their business models to increase customer satisfaction and drive revenue.

Based on regions, North America, Asia-Pacific, Europe, and LAMEA dominate the AIaaS market, with North America contributing with the highest market share. This North American position is predicted to be secured in the coming years, thanks to the proliferation of IT infrastructure and large enterprises.

Several major players in the AIaaS market such as Apple Inc., Intel Inc., Salesforce Inc., IBM Corporation and others have introduced and applied AI services in their models through acquisitions. , product introduction and cooperation. Furthermore, in response to the growth in their market sectors, these giants focus on developing new AI services and platforms, increasing their reach and customer experience. to meet higher goals.

For example, Amazon Web Service launched Amazon Transcribe for their model, introducing an automatic speech recognition service that provides speech-to-text conversion and helps distinguish among other top speakers.

Small and new businesses do not have enough resources to set up their own AI platform with the concept of market growth. Thereby, AIaaS increases the hope of technical and AI support for these small and medium-sized enterprises, helping them compete with the big players in the field of AI without major investment.


AIaaS can be an area of ​​service that makes AI technology available to all businesses. Moreover, it offers affordable, fast and ready-to-use solutions with minimal effort.

Most companies do not choose to develop their AI software in-house. AIaaS increases your chances of scaling your business while also paying for the tools you need, giving you the option to upgrade to higher plans when needed.

Find the perfect AIaaS Partner for your business to tackle all your extra tasks, unrelated to your expertise, without any extra cost to increase your benefits. Algoscale is a Artificial intelligence solution provider deploying innovative and effective artificial intelligence solutions to help businesses become more agile and intelligent.

Our AI solutions combine business, development and operational data to provide useful insights and provide our customers with a unified view of the changing business environment. their. This allows them to take advantage of automation and deliver better business results over time.

We hope you find this information useful. Algoscale aims to provide wisdom on many topics. Keep reading and learning new things!

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