Artificial Intelligence Category To Grow Substantially At A CAGR Of 38.1% Till 2030

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The Artificial Intelligence (AI) category is expected to grow at a CAGR of 38.1% from 2023 to 2030.

Artificial Intelligence Procurement Intelligence

Pricing and cost analysis is a process that helps organizations derive and forecast the real cost of products or services over a specified period of time. This analysis takes into account every cost component, and also gives a competitive advantage when negotiating with suppliers by helping organizations understand the true cost of goods and services. Additionally, the outcome of pricing and cost analysis can help procurement leaders understand the detailed cost drivers in a particular category.

In this artificial intelligence procurement intelligence report, we have estimated the pricing of major cost components. Data processing management, hardware, labor, and software form the biggest cost component of artificial intelligence implementation. Further, the cost is dependent on the type of data available, the complexity of problem being solved. For example, in developing an AI-based solution, prototype development cost start from USD 25,000 onwards. Maintenance costs upwards of USD 320,000. The costs of software are from USD 30,000 to USD 50,000. The annual skilled labor costs can be at least USD 320,000. Thus, the average costs for custom AI solutions come up to around USD 500,000. 

Order your copy of the Artificial Intelligence category procurement intelligence report 2023-2030, published by Grand View Research, to get more details regarding day one, quick wins, portfolio analysis, key negotiation strategies of key suppliers, and low-cost/best-cost sourcing analysis

Operational Capabilities - Artificial Intelligence

  • Industries Served - 20%
  • Years in Service - 15%
  • Revenue Generated - 15%
  • Employee Strength - 15%
  • Geographic Service Provision - 15%
  • Certifications - 10%
  • Key Clients - 10%

Functional Capabilities - Artificial Intelligence

By type:

  • Reactive machine - 50%
  • Limited memory - 35%
  • Theory of mind - 10%
  • Self-aware - 5%

Rate Benchmarking

When procuring a package of products or subscribing to services, every business and their procurement staff look forward to getting the best deal possible. Rate benchmarking involves comparing the prices/costs of multiple sets of products/services to determine the best combination that can potentially assist the procurement team in obtaining the best rate.

The geographical location and nature of the firm are critical factors in examining rate benchmarking in the artificial intelligence category. For instance, artificial intelligence services in the U.S. are typically costlier than services in India. For example, in U.S the average rate of a lead developer is the highest starting from USD 85 - USD 125 per hour, as compared to India which is around USD 32 - USD 65 per hour. This is due to a number of factors, including the availability of skilled labor, and the regulatory environment. The cost of AI services changes based on the size of the project. For example, a small business that is simply looking to implement an AI-based solution will likely pay less than a large enterprise that is looking to build a complex AI-based platform. Prices vary depending on the complexity of the artificial intelligence application. As an example, a basic application may cost between USD 900 - USD 5,000 whereas a highly complex application may cost from USD 150,000 - 300,000.

Supplier Newsletter

In June 2023, IBM announced its partnership with The All England Lawn Tennis Club for the 2023 Wimbledon Championship. During the competition, the company plans to use IBM Watson's generative AI technology to provide commentary for video highlights. Furthermore, the IBM AI Draw Analysis will provide information into how advantageous the draws would be for each singles player.

In March 2023, Enlitic Curie, a platform that simplifies workflow management of radiology departments, was released by Enlitic. Curie|ENDEX, which uses NLP and computer vision to analyze and process medical pictures, and Curie|ENCOG, which uses AI to identify and secure Protected Health Information, are both hosted on this platform.

In August 2022, Atomwise established an exclusive, strategic research cooperation with Sanofi for AI-powered medication development. As part of the agreement, Sanofi will use Atomwise's AtomNet platform for computational discovery and research on up to five therapeutic targets.

In July 2022, Clarifai announced the debut of its free 'Clarifai Community' service, allowing anybody to share, create, and utilize The World's AI. Furthermore, it announced the creation of the 'AI Lake' product category, which aggregates and centralizes a business's AI resources and provides capabilities for sharing throughout the enterprise.

List of Key Suppliers

  • IBM Corporation
  • Advanced Micro Devices
  • AiCure
  • Arm Limited
  • Atomwise, Inc
  • Ayasdi AI LLC
  • Baidu, Inc
  • Clarifai, Inc
  • Cyrcadia Health
  • Enlitic, Inc
  • Google LLC
  • H2O.ai
  • HyperVerge, Inc
  • Intel Corporation
  • Iris.ai AS
  • Lifegraph
  • Microsoft
  • NVIDIA Corporation
  • Sensely, Inc
  • Zebra Medical Vision, Inc 

Browse through Grand View Research’s collection of procurement intelligence studies:

Artificial Intelligence Procurement Intelligence Report Scope 

  • Artificial Intelligence Category Growth Rate : CAGR of 38.1% from 2023 to 2030 
  • Pricing Growth Outlook : 8% - 10% (Annually) 
  • Pricing Models : Fixed fee pricing, cost plus pricing 
  • Supplier Selection Scope : Cost and pricing, past engagements, productivity, geographical presence 
  • Supplier Selection Criteria : Type, technical expertise, security measures, cost and value, support and maintenance, regulatory compliance, and others 
  • Report Coverage : Revenue forecast, supplier ranking, supplier positioning matrix, emerging technology, pricing models, cost structure, competitive landscape, growth factors, trends, engagement, and operating model 

Brief about Pipeline by Grand View Research:

A smart and effective supply chain is essential for growth in any organization. Pipeline division at Grand View Research provides detailed insights on every aspect of supply chain, which helps in efficient procurement decisions. 

Our services include (not limited to): 

  • Market Intelligence involving – market size and forecast, growth factors, and driving trends
  • Price and Cost Intelligence – pricing models adopted for the category, total cost of ownerships
  • Supplier Intelligence – rich insight on supplier landscape, and identifies suppliers who are dominating, emerging, lounging, and specializing
  • Sourcing / Procurement Intelligence – best practices followed in the industry, identifying standard KPIs and SLAs, peer analysis, negotiation strategies to be utilized with the suppliers, and best suited countries for sourcing to minimize supply chain disruptions
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