The global AI infrastructure market will reach $223,45-billion by 2030 with a projected CAGR of 30,4% from 2024 to 2030, according to a new report by Grand View Research.

Artificial intelligence (AI) is undergoing a significant transformation fueled by rapid market growth. AI infrastructure provides the essential resources businesses need to leverage the true power of artificial intelligence.

The surging demand for generative AI (GenAI) necessitates robust infrastructure to handle complex computations. Businesses can develop and deploy AI models faster, accelerating their ability to bring AI-powered solutions to market.

Cloud-based solutions eliminate the need for expensive on-premises hardware management, freeing up resources for core AI development. In addition, continuous advancements in AI technologies, particularly in deep learning and neural networks, are expanding the capabilities of AI systems and making them more sophisticated and impactful. Such factors are further driving the market growth.

Additional highlights from the report include:

* Based on components, the hardware segment held the market with the largest revenue share of 63% in 2023. The increasing demand for specialised chips and processors to compute complex algorithms drives this segment growth. With the rise in AI in systems, more powerful chips are required to process the data. The chips help reduce energy consumption and increase performance.

* Based on technology, the machine learning segment led the market with the largest revenue share of 58,4% in 2023. Increasing data, advancements in algorithm models, and the rise in cloud computing drive the market growth. Machine learning helps AI systems automatically learn and improve from experience without the need for programming. It’s used in AI infrastructure to handle complex patterns in large databases.

* Based on application, the training segment led the market with the largest revenue share of 71,4% in 2023. Training helps develop models specialised in specific tasks such as language translation, voice recognition, or anomaly detection in network traffic.

* Based on deployment, the on-premises segment held the market with the largest revenue share of 50% in 2023. This is due to the increasing demand for low-latency data transfer, reduced operational costs, and customised AI infrastructure solutions. With on-premises infrastructure deployment, organisations can customise the setup based on their requirements. On-premises deployment offers control over data security.

* Based on end user, the enterprise segment is expected to grow at the fastest CAGR over the forecast period. The increasing digital transformation of businesses and the increasing complexity of data are expected to drive market growth. Enterprises use AI infrastructure for data management, storage, and processing – they also need AI infrastructure for operational efficiency.

* North America dominated the market with a revenue share of 38,4% in 2023. North America is home to many of the world’s leading tech companies such as Google, Amazon, Microsoft, and IBM which offer cloud-based services.

* The US accounted for the largest market share in 2023. The US is home to leading technology companies and startups at the forefront of AI, machine learning, and computing hardware innovations creating a strong ecosystem for AI R&D and necessitating robust AI infrastructure.