Generative AI 2024 Report
Generative artificial intelligence is poised to produce $1.3 trillion in revenue — 10-12% of all technology spending — over the next eight years in hardware, software and services and more as businesses supercharge their products. The interfaces and tools leveraging gen AI are early, but we believe some common themes include generating summaries, personalized recommendations, image and video content using conversational user interfaces, and built-in language translation. Training AI through machine learning and neural network algorithms using massive datasets (the large language model, or LLM) will be a huge market, reaching $471 billion in sales by 2032 and boosting demand for accelerators on servers and storage units at data centers. Companies will use the public cloud to deploy generative AI, benefitting hyperscalers like Meta, Microsoft, Amazon and Alphabet, with a projected CAGR of 54% to $309 billion.
Report highlights
- Compute for Training and Major LLMs: Nvidia can maintain dominance in data-center compute, driven by its performance lead and strong demand for AI workloads tied to training LLMs. Among the foundational model companies, competition is likely to be intense, with OpenAI-Microsoft, Google, Meta and Anthropic releasing new LLMs.
- On-Device AI for Inference: On-device AI could see rapid adoption of features like summarizing text, translating language, generating images and videos with text-based prompts, and voice assistants. Makers of edge devices, such as PCs from Dell, smartphones from Apple and connected cars from Tesla, could be among the beneficiaries of the demand for on-device AI.
- Incremental Cloud Sales Boost for Hyperscalers: Hyperscale cloud companies like Microsoft, Amazon.com and Google should get a boost in recurring revenue. Cloud vendors’ high capex and availability of GPUs for training and inferencing aids monetization as gen AI is deployed across enterprises.