Generative AI Market to Grow 43% Annually from 2024 to 2028

The generative AI market is experiencing unprecedented growth, largely driven by advancements in large language models (LLMs) such as OpenAI's GPT series and Google's BERT. These models have significantly enhanced natural language understanding capabilities, enabling a wide range of applications in industries such as customer service, content creation, and data analysis.

From a valuation of nearly $15.01 billion in 2023, the generative AI market size 2024 was valued at $23.1 billion, according to a new report by The Business Research Company. The market is projected to grow to $90.61 billion by 2028, growing at a compound annual growth rate (CAGR) of 43.28%. The market is further expected to reach $228.3 billion in 2033.    

Advancements in LLM Technology Are Key Drivers of Generative AI Market Growth

Large language models have revolutionized the field of natural language processing (NLP), allowing for more accurate and human-like text generation, summarization, translation, and question-answering tasks. For instance, a recent study highlighted a 15% increase in efficiency in natural language understanding tasks with the latest LLMs compared to earlier models. This progress underscores the potential of LLMs in transforming various sectors by automating and enhancing language-related processes.

Market Leaders Are Increasingly Deploying LLMs to Automate Processes

Companies are increasingly focusing on deploying large language models to automate and improve processes such as customer service, content creation, and data analysis. Dynatrace, for example, launched AI Observability for generative AI and LLMs, providing comprehensive security and observability for applications powered by these technologies. This development allows businesses to adopt generative AI confidently, boosting revenue, productivity, and creativity.

High-Growth Market Segments in the Generative AI Market

The generative AI market is segmented as follows:

1) By Component: Software, Services

2) By Offering Type: Image, Video, Speech, Other Offering Types

3) By Technology: Generative Adversarial Networks (GANs), Transformer, Variational Autoencoder (VAE), Diffusion Networks

4) By End-User: Media and Entertainment, BFSI (Banking, Financial Services and Insurance), IT and Telecom, Healthcare, Automotive and Transportation, Other End-Users

Major Generative AI Market Players

The market is concentrated, with top players accounting for a significant share. OpenAI leads with a 10.11% market share, followed by Microsoft Corporation, Google LLC, Adobe Inc., NVIDIA Corporation, Salesforce.com, Autodesk Inc., Amazon Web Services, IBM Corporation, and Oracle Financial Services Software Limited.

OpenAI, known for its ChatGPT and other advanced AI models, is at the forefront, pushing the boundaries of AI research and application. Microsoft and Google are also heavily investing in large language models and generative AI technologies, integrating them across their product lines to enhance functionality and user experience.

Regional Dominance and Growth in the Generative AI Market

North America led the generative AI market in 2023, capturing 42.1% share with $6,315.2 million. Following were Asia-Pacific, Western Europe, and other regions. Looking ahead, Asia-Pacific and North America are projected to grow the fastest, with CAGRs of 45.9% and 44.1% respectively.

Generative AI Market Forecast and Future Trends

The generative AI market is anticipated to experience substantial growth in the coming years. This growth is fueled by widespread adoption of AI across diverse industries, continuous advancements in large language model (LLM) technology, and the seamless integration of generative AI into digital platforms. These factors collectively contribute to the expanding scope and applications of generative AI, promising transformative impacts across sectors worldwide.

For more information, please read the Business Research Company’s report Generative AI Global Market Opportunities and Strategies to 2033, which offers an in-depth generative AI market analysis, spanning from 2018 to 2023 for historical data, and projecting from 2023 to 2028 for future trends. This report delves into market dynamics across various regions and major economies, highlighting generative AI market drivers and challenges. A key feature of the report is the competitive benchmarking briefs, which provide a financial comparison among top market players, offering insights into their market positions and strategic initiatives.

About The Business Research Company

The Business Research Company is a market intelligence firm that excels in company, market, and consumer research. Located globally, it has specialist consultants in a wide range of industries including manufacturing, healthcare, financial services, chemicals, and technology. Find the company on LinkedIn, Twitter, Facebook, or YouTube for more.