AI Governance Market Overview
AI Governance Market Size is expected to reach USD 114.24 Billion by 2033. The AI Governance industry size accounted for USD 54.74 Billion in 2023 and is expected to expand at a compound annual growth rate (CAGR) of 62.4% from 2023 to 2033. AI governance in the financial sector refers to the regulatory and supervisory expectations for AI models used in financial services. It involves implementing sound governance frameworks to ensure that AI models align with an organization’s objectives and values, while also addressing conduct and prudential risks. These frameworks should consider existing international standards and emerging common themes, such as reliability, accountability, transparency, fairness, and ethics. The development of international guidance or standards by financial standard-setting bodies could help jurisdictions embarking on digital transformation and serve as a minimum benchmark for the orderly deployment of AI technologies within the financial sector.
Global AI Governance Market Synopsis
COVID-19 Impact Analysis
The AI Governance market experienced a detrimental effect due to the Covid-19 pandemic. The COVID-19 pandemic has caused supply chain hiccups, which have decreased demand or created shortages in the market for AI governance. Spending by consumers and businesses has decreased significantly as a result of the travel restrictions and social distancing measures, and this trend is expected to persist for some time. The epidemic has altered end-user trends and tastes, prompting manufacturers, developers, and service providers to implement diverse tactics aimed at stabilizing their businesses.
Global AI Governance Market Dynamics
The major factors that have impacted the growth of AI Governance are as follows:
Drivers:
⮚     Technological Complexity
AI systems are becoming increasingly complex, involving multiple stakeholders, data sources, algorithms, and decision-making processes. Governance frameworks are needed to manage this complexity and ensure alignment with organizational goals.
Restraint:
- Data Quality and Availability
AI systems rely on large volumes of high-quality data for training and decision-making. However, ensuring data quality, integrity, and availability can be challenging, especially in domains with limited or biased datasets.
Opportunity:
⮚     Market Expansion
As AI technologies become more pervasive across industries and sectors, the demand for AI governance solutions and services is expected to grow significantly. This expansion presents opportunities for both existing and new players in the AI governance market to develop innovative solutions to address emerging governance challenges.
AI Governance Market Segment Overview
By Component
Based on the Component, Â Â the market is segmented based on Solution, Services. The solution segment dominated the market in 2022. Owing to the existence of well-diversified market competitors, the solution sector is also expected to dominate the segment market throughout the projection period.
By Deployment Mode
Based on Deployment Mode, the market has been divided into Cloud and On-premise, the on-premises category led the market in 2022. Some of the key trends in the on-premises AI governance market that are propelling the growth of the sector are data governance, explainable AI, edge computing, integration with DevOps workflows, scalability, and flexibility.
By Organization Size
Based on the Organization Size, the market has been divided into Large enterprises and Small and medium-sized enterprises. Large enterprises dominate the market as companies are putting more emphasis on data security and privacy because they want to make sure that their AI systems safeguard sensitive data. Additionally, it is anticipated that the need for integrating AI governance to lower risk will increase as big businesses become more vulnerable to cyberattacks and other security-related problems, spurring market expansion in this area.
By Vertical
Based on Vertical, the market has been divided into BFSI, Government and Defense, Healthcare and Information & Communication Technologies and Other Verticals. In 2022, the Government and Defense category held a dominant portion of the market, accounting for roughly 19%. The market is expanding due to a number of trends ensuring the responsible, moral, and open application of AI in many fields, such as healthcare and life sciences.
Global AI Governance Market Regional Analysis
Based on region, the market has been divided into North America, Europe, Asia-Pacific, the Middle East & Africa, and Latin America. The area of North America is anticipated to dominate the market for the usage of AI Governance, followed by those in Asia-Pacific and Europe.
AI Governance North America Market
The North American region holds a dominant position in the AI Governance market. In 2022, the North American region held the largest market share, accounting for 31.93%. Because of the growing usage of artificial intelligence (AI) by businesses and governments, which is one of the key factors driving the industry’s growth, North America is anticipated to take a sizable part of the market. Legislators and government agencies in the United States have been developing rules and laws for automated systems and aluminum in recent years in an effort to strike a balance between preventing the adverse consequences of this technology and encouraging healthy competition and advancements.
AI Governance Europe Market
The Europe region is witnessing rapid growth and emerging as a significant market for the AI Governance industry With a focus on data privacy and ethical AI, Europe is another important market for AI legislation. Some recent EU regulations that have been established or proposed target data privacy, bias and discrimination, and algorithmic transparency. These include the General Data Protection Regulation (GDPR) and the AI Act. Furthermore, developing guidelines and standards for AI ethics has become more important, with organizations like the European Alliance and the high-level expert group on AI spearheading this effort.
Competitive Landscape
The competitive landscape includes key players (tier 1, tier 2, and local) having a presence across the globe. Companies such as Alphabet Inc, Microsoft Corporation, IBM Corporation, Amazon Web Services, Inc, and QlikTech International AB are some of the leading players in the global AI Governance Industry. These players have adopted partnership, acquisition, expansion, and new product development, among others as their key strategies.
Key Market Players:
- Alphabet Inc
- Microsoft Corporation
- IBM Corporation
- Amazon Web Services, Inc
- QlikTech International AB
- TIBCO Software Inc.
- SAS Institute Inc.
- Facebook, Inc
- Pymetrics Inc.
- Ataccama Corporation
Key Development:
In December 2021, Amazon Web Services, Inc. partnered with Meta, an American multinational technology corporation, to supply cloud services to AWS. Through this partnership, both businesses would work to improve how users of PyTorch on AWS operate their instances as well as how developers build, train, deploy, and use machine learning and artificial intelligence models.
Scope of the Report
Global AI Governance Market, by Component
- Solution
- Services
Global AI Governance Market, by Deployment Mode
- Cloud
- On-premises
Global AI Governance Market, by Organization Size
- Large enterprises
- Small and medium-sized enterprises
Global AI Governance Market, by Vertical
- BFSI
- Government and Defence
- Healthcare and Information & Communication Technologys
- Other Verticals
Global AI Governance Market, by Region
- North America
- US
- Canada
- Mexico
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Benelux
- Nordic
- Rest of Europe
- Asia Pacific
- China
- Japan
- South Korea
- Indonesia
- Austalia
- Malaysia
- India
- Rest of Asia Pacific
- South America
- Brazil
- Argentina
- Rest of South America
- Middle East & Africa
- Saudi Arabia
- UAE
- Egypt
- South Africa
- Rest of Middle East & Africa
| Parameters | Indicators |
|---|---|
| Market Size | 2033: $114.24 Billion |
| CAGR | 62.4% CAGR (2023-2033) |
| Base year | 2022 |
| Forecast Period | 2023-2033 |
| Historical Data | 2021 |
| Report Coverage | Revenue Forecast, Competitive Landscape, Growth Factors, and Trends |
| Key Segmentations | Component, Deployment Mode, Organization Size,Vertical |
| Geographies Covered | North America, Europe, Asia-Pacific, Latin America, Middle East, Africa |
| Key Vendors | Alphabet Inc, Microsoft Corporation, IBM Corporation, Amazon Web Services, Inc, QlikTech International AB, TIBCO Software Inc., SAS Institute Inc., Facebook, Inc, Pymetrics Inc., Ataccama Corporation |
| Key Market Opportunities | AI Governance Training and Education International Collaboration and Standards Setting |
| Key Market Drivers | Data Governance Technological Advancements |
REPORT CONTENT BRIEF:
- High-level analysis of the current and future AI Governance Industry trends and opportunities
- Detailed analysis of current market drivers, restraining factors, and opportunities analysis in the future
- Historical market size for the year 2021, and forecast from 2023 to 2033
- AI Governance market share analysis for each segment
- Competitor analysis with a comprehensive insight into its product segment, financial strength, and strategies adopted.
- Identifies key strategies adopted by the key players including new product development, mergers and acquisitions, joint ventures, collaborations, and partnerships.
- To identify and understand the various factors involved in the global AI Governance market affected by the pandemic
- To provide year-on-year growth from 2022 to 2033
- To provide short-term, long-term, and overall CAGR comparison from 2022 to 2033.
- Provide Total Addressable Market (TAM) for the Global AI Governance Market.
