The rise of large language models and generative AI is expected to produce rapid growth in the GenAI market over the next two years with a new study from AltIndex.com predicting that generative AI will become a $100 billion industry by 2026.
The study notes that the release of OpenAI's ChatGPT marked a turning point for the global AI industry. The chatbot became the fastest-growing app in history with 100 million users in just two months, making artificial intelligence into one of the biggest stories in 2023.
While ChatGPT was the most popular showcase of generative artificial intelligence, other AI tools like Character.ai, DeepL, Quillbot, Midjourney, and Capcut also hit billions of visits, the researchers reported.
Between 2020 and 2023, the market size of generative AI has skyrocketed by a whopping 690%, jumping from $5.7 billion to $44.9 billion.
Data also shows that the market has been practically doubling for the past three years, with the annual growth rates floating between 93% and 106%.
Although Statista expects the annual growth rate to slow down in 2024, the value of the entire market will still increase by a massive 48.4% and hit $66.6 billion. The double-digit growth will continue in the following years, with generative AI reaching a $100 billion value by 2026, showing a huge 65% increase in just two years. By 2030, this figure is expected to more than double and jump over $207 billion.
The study predicts that the United States will remain the world's largest generative AI market, expected to hit $37.3 billion in value in 2026, or 60% more than this year. As the second largest globally, the Chinese market will grow even more, with its valuation jumping by 72% to $14.7 billion in the next two years. The German generative AI market follows with a 60% two-year increase and a valuation of $4.5 billion by 2026.
The surging demand for generative AI tools will help this market become one of the largest revenue streams in the AI industry. Statista expects generative AI to make 24% of the total market value by 2026, up from 20% this year.
AI tools like Chat GDP, Character.ai, DeepL, Quillbot, Midjourney, and Capcut have also played a major role in user growth in the AI industry. Last year, around 254 million people used AI tools, 2.5 times more than in 2020. With roughly 60 million people embracing AI solutions and tools per year, the entire market is set to reach more than half a billion users by 2027.
The full story and additional data can be found here.
