Korea IDC predicts global AI solutions will be the top 10 in 2021
Projected spending of $341.8 billion in 2024
Total expected to exceed $500 billion


Citing its global AI market outlook report, Korea IDC stated on the 26th that global AI revenue this year is expected to reach $341.8 billion, a 15.2% increase from last year. Next year, it is projected to grow by 18.8%, surpassing $500 billion in 2024.

IDC divides the AI market into software, hardware, and services markets.

While the AI software market accounts for 88% of the overall AI market, the AI hardware market is expected to experience the fastest growth in the coming years. Starting in 2023, the AI services market is projected to grow the fastest.

By market segment, AI applications account for approximately 50% of the AI software market. AI platforms are projected to have the highest five-year compound annual growth rate (CAGR), at 33.2%. AI system infrastructure software is expected to grow the slowest at 14.4%, but will still account for about 35% of total AI software revenue.

In the AI application market, AI ERM is expected to grow slightly more than CRM over the next five years, and AI lifecycle software is expected to grow the fastest in the AI platform market.

The AI hardware market is the smallest, accounting for only about 5% of the overall AI market. However, it is projected to be the fastest-growing market this year, growing 29.6% year-over-year. It is expected to maintain the highest growth rate next year, with a CAGR of 19.4% over the next five years.

The hardware market is divided into two: servers and storage.

IDC said that while the server market has a higher market share of about 82%, the storage market is expected to show higher growth, maintaining an average annual growth rate of 22.1% over the next five years.

The AI services market recorded the steepest growth in 2020, reaching $19.4 billion, surpassing hardware and software. It is expected to grow by 19.3% in 2021 and will continue to grow rapidly, maintaining a CAGR of 21% over the next five years.

The AI services market is divided into two segments: IT services and business services. IT services account for approximately 80% of total revenue, making it a significant market. Both markets are projected to grow by 21% over the next five years. The AI services market is projected to reach $50 billion by 2025.

Kim Kyung-min, a senior researcher at IDC Korea, said, "The domestic AI market is also growing rapidly." He added, "AI is being applied across all layers of IT, from the user interface, the first point of contact for users, to applications, middleware, and the system layer encompassing software and hardware." He emphasized, "AI is becoming an essential business technology."