BUSINESS TECH | AI market needs $6T annual revenue by 2031 — Bain
The report said existing consumer and enterprise AI applications could generate $1.2 trillion to $1.8 trillion in revenue, leaving about $4.2 trillion to come from new products, services and applications.
The global artificial intelligence market could require $6 trillion in annual revenue by 2031 to sustain the infrastructure needed to meet rising AI compute demand, according to Bain & Co.’s seventh annual Global Technology Report.
The report said existing consumer and enterprise AI applications could generate $1.2 trillion to $1.8 trillion in revenue, leaving about $4.2 trillion to come from new products, services and applications.
Bain identified four areas that could generate the additional revenue: AI models replacing search engines and incorporating advertising; autonomous systems in vehicles, drones and industrial automation; physical AI involving simulations, digital twins and robotics; and new applications enabled by what the report calls abundant intelligence, including drug discovery, mental health and energy generation.
“The debate today is fixated on employee productivity. The economics of AI infrastructure demand trillions in new revenue beyond productivity gains,” said David Crawford, chairman of Bain’s global Technology practice.
The report also found that the surge in AI compute demand has strengthened the hardware and semiconductor sectors. Their market capitalization grew at a compound annual rate of 24 percent from 2020 to 2026, compared with 6 percent for software companies.
Bain identified high-bandwidth memory, advanced packaging and custom silicon as among the fastest-growing segments. It also said hyperscalers and AI companies are increasingly developing specialized accelerators and custom chips for their workloads.
Supply chain considerations are also becoming more important as companies contend with natural disasters, geopolitical disruptions and export controls. Bain said companies are diversifying suppliers and production locations while securing capacity through long-term agreements and other arrangements.
Cybersecurity is another area undergoing significant change. The report estimated that AI has shortened the time required for a typical cyberattack from about four weeks to 18 hours.
Bain said companies are increasing remediation budgets and, in some cases, redirecting 20 percent to 25 percent of cybersecurity personnel toward addressing alerts generated by AI-powered scans. It also highlighted risks involving legacy systems, network layers and software-as-a-service vendors.
The report identified the speed at which companies adopt and deploy AI — or “absorption speed” — as an increasingly important competitive factor. Leading AI labs are investing as much as $9.75 billion in forward-deployed engineering models to help enterprises integrate AI into their operations.
Bain also reported that senior technology leaders surveyed expect AI to deliver a 148 percent improvement in release-cycle speed and a 95 percent increase in software developer productivity over the next one to two years. Current gains, however, range from 20 percent to 27 percent across key metrics.
The report said faster AI-assisted coding could shift bottlenecks to software review, coordination, quality and governance, requiring companies to redesign their development processes rather than optimize individual tasks alone.
Full disclosure: All news articles published on the TechSabado website are written by human journalists, unless otherwise specified. Final text editing is also performed by human editors, with artificial intelligence (AI) used only to assist with additional grammar and style guide corrections..
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