Generative AI Global Market Opportunities and Strategies to 2033

This report describes and explains the generative AI market and covers 2018-2023, termed the historic period and 2023-2028, 2033F termed the forecast period. The report evaluates the market across each region and for the major economies within each region.

The global generative AI market reached a value of nearly $15 billion in 2023, having grown at a compound annual growth rate (CAGR) of 34.84% since 2018. The market is expected to grow from $15 billion in 2023 to $90.6 billion in 2028 at a rate of 43.28%. The market is then expected to grow at a CAGR of 20.31% from 2028 and reach $228.4 billion in 2033.

Growth in the historic period resulted from increased cloud computing adoption, strong economic growth in emerging markets, increased internet penetration and rapid urbanization. Factors that negatively affected growth in the historic period were issues related to bias and inaccurately generated output.

Going forward, the increasing usage of artificial intelligence, rising adoption of AI in content creation, rapid growth of the large language model (LLM) and integration of generative AI technologies across digital platforms will drive the market. Factors that could hinder the growth of the generative AI market in the future include limited availability of skilled personnel and technical expertise and growing concerns about data security.

The generative AI market is segmented by component into software and services. The software market was the largest segment of the generative AI market segmented by component, accounting for 69.64% or $10.4 billion of the total in 2023. Going forward, the services segment is expected to be the fastest growing segment in the generative AI market segmented by component, at a CAGR of 49.02% during 2023-2028.

The generative AI market is segmented by offering type into image, video, speech and other offering types. The image market was the largest segment of the generative AI market segmented by offering type, accounting for 47.32% or $7.1 billion of the total in 2023. Going forward, the video segment is expected to be the fastest growing segment in the generative AI market segmented by offering type, at a CAGR of 47.28% during 2023-2028.

The generative AI market is segmented by technology into generative adversarial networks (GANs), transformers, variational autoencoder (VAE) and diffusion networks. The generative adversarial networks (GANs) market was the largest segment of the generative AI market segmented by technology, accounting for 32.23% or $4.8 billion of the total in 2023. Going forward, the generative adversarial networks (GANs) segment is expected to be the fastest growing segment in the generative AI market segmented by technology, at a CAGR of 45.26% during 2023-2028.

The generative AI market is segmented by end-user into media and entertainment, banking, financial services and insurance (BFSI), IT and telecom, healthcare, automotive and transportation and other end-users. The media and entertainment market was the largest segment of the generative AI market segmented by end-user, accounting for 30.00% or $4.5 billion of the total in 2023. Going forward, the healthcare segment is expected to be the fastest growing segment in generative AI market segmented by end-user, at a CAGR of 50.88% during 2023-2028.

North America was the largest region in the generative AI market, accounting for 42.1% or $6.3 billion of the total in 2023. It was followed by Asia-Pacific, Western Europe and then the other regions. Going forward, the fastest-growing regions in the generative AI market will be Asia-Pacific and North America, where growth will be at CAGRs of 45.9% and 44.1% respectively. These will be followed by Western Europe and South America, where the markets are expected to grow at CAGRs of 39.6% and 39% respectively.

The global generative AI market is concentrated, with a few large players operating in the market. The top ten competitors in the market made up 40.71% of the total market in 2022. OpenAI was the largest competitor with a 10.11% share of the market, followed by Microsoft Corporation with 6.74%, Google LLC with 5.11%, Adobe Inc. with 4.58%, NVIDIA Corporation with 4.18%, Salesforce.com with 3.53%, Autodesk Inc. with 2.38%, Amazon Web Services, Inc. with 2.21%, IBM Corporation with 1.20% and Oracle Financial Services Software Limited with 0.69%.

The top opportunities in the generative AI market segmented by component will arise in the software segment, which will gain $47.8 billion of global annual sales by 2028. The top opportunities in the generative AI market segmented by offering type will arise in the image segment, which will gain $35.8 billion of global annual sales by 2028. The top opportunities in the generative AI market segmented by technology will arise in the generative adversarial networks (GANs) segment, which will gain $75.6 billion of global annual sales by 2028. The top opportunities in the generative AI market segmented by end-user will arise in the media and entertainment segment, which will gain $23.5 billion of global annual sales by 2028. The generative AI market size will gain the most in the USA at $25.8 billion.

Market-trend-based strategies for the generative AI market include technological advancements in generative AI models to improve user experiences, strategic partnerships and collaborations among market players to drive innovation, innovative product launches with focus on AI-powered sales and marketing solutions and focus on deployment of large language models (LLMs) to automate processes.

Player-adopted strategies in the generative AI market include focus on strengthening business capabilities through new product developments, strengthening operational capabilities through new product launches and enhancing operational capabilities through strategic partnerships.

To take advantage of the opportunities, the analyst recommends the generative AI companies to focus on user-centric generative AI solutions, focus on product innovation for revenue growth, focus on leveraging large language models for enhanced automation, expand in emerging markets, continue to focus on developed markets, focus on strategic collaborations for market expansion, provide competitively priced offerings, participate in trade shows and events, continue to use B2B promotions and focus on media and entertainment, and healthcare segments.