AI Governance Market Size is expected to reach a revenue of USD 3,594.8 Mn by 2033, at 39.0% CAGR: Dimension Market Research

New York, Nov. 25, 2024 (GLOBE NEWSWIRE) -- Overview:

The AI Governance Market size is expected to reach USD 185.5 million by 2024 and is further anticipated to reach USD 3,594.8 million by 2033 according to Dimension Market Research. The market is anticipated to register a CAGR of 39.0% from 2024 to 2033.

AI Governance includes regulations, policies, and practices that govern the deployment, development, and usage of AI technologies with a focus on societal impact, privacy, fairness, accountability, and safety. The framework is characterized by non-discrimination a transparency and looks into the security of personal data and privacy rights. AI governance like certification processes, auditing, impact assessments, and public consultation can be implemented through a collaborative effort including governments, regulatory bodies, and civil society organizations.

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The US Overview

The AI Governance Market in the US is projected to reach USD 1.3 million in 2024 at a compound annual growth rate of 13.4% over its forecast period.

The U.S. AI governance market provides growth opportunities due to better AI adoption, a focus on data privacy, and transforming regulations. Government initiatives, like AI ethics guidelines and cybersecurity measures, drive demand for governance solutions. However, high costs and the complexity of implementing comprehensive AI governance frameworks pose challenges, particularly for smaller organizations with limited resources.

Important Insights

• The AI Governance Market is expected to grow by USD 3,594.8 million by 2033 from 2025 with a CAGR of 19.7%.
• The software segment is set to get the majority share of the AI Governance Market in 2024.
• Based on organization size, a large Enterprise segment is expected to be leading the market in 2024.
• The government & defense segment is anticipated to get the largest revenue share in 2024 in the AI Governance Market.
• North America is predicted to have a 32.9% share of revenue share in the Global AI Governance Market in 2024.

Global AI Governance Market: Trends

• Emphasis on Explainability: The growing demand for AI systems to provide transparent and understandable explanations for their decisions is shaping governance frameworks, mainly in high-stakes sectors.
• Focus on Ethical AI: There is a major trend toward establishing ethical guidelines and principles for AI use, with organizations prioritizing fairness, accountability, and transparency.
• Cross-Industry Collaborations: Collaboration between tech companies, regulators, and academic institutions is emerging to create the best practices and standards for responsible AI governance.
• Global Regulatory Initiatives: Many regions, mainly in Europe and North America, are advancing complete regulatory frameworks focused at ensuring the responsible deployment of AI technologies.

AI Governance Market: Competitive Landscape

The AI governance market is highly competitive, with companies investing in technologies like bias detection, transparency tools, and privacy protection to address ethical & regulatory challenges. Strategic partnerships, acquisitions, and collaborations are prevalent as firms improve offerings and expand their presence. Startups are also entering the space, providing innovative and affordable solutions to meet diverse business needs.

Some of the major players in the market include IBM Corp, Alphabet Inc, Microsoft Corp, Amazon Web Services, SAS Institute, SAP SE, and more.

Some of the prominent market players:

• IBM Corp
• Alphabet Inc
• Microsoft Corp
• Amazon Web Services
• SAS Institute
• SAP SE
• Facebook Incs
• FICO Inc
• ai.
• Salesforce
• Other Key Players

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AI Governance Market Scope

Segment Analysis:

Large enterprises are anticipated to dominate the AI governance market, driven by an aim for data privacy and security. To minimize the risks from cyberattacks, many are integrating AI governance solutions, collaborating with providers, and acquiring startups. Meanwhile, small & medium-sized enterprises (SMEs) are set for fast growth, seeking scalable, affordable AI governance solutions. Lacking resources to build in-house frameworks, SMEs highly depends on cloud-based AI Governance as a Service (AGaaS), allowing them to adopt best practices without major infrastructure investments.

AI Governance Market Segmentation

By Offering

• Solution
  • Software Tools
  • Platform
• Services
  • Consulting
  • Integration
  • Support & Maintenance

 By Deployment

• On-Premise
• Cloud

By Size of Organization

• SMEs
• Large Enterprises

By End User Industry

• BFSI
• Healthcare & Life science
• Media & Entertainment
• Government & Defense
• IT & Telecom
• Retail
• Automotive
• Others

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Global AI Governance Market: Driver

• Regulatory Compliance: Stricter regulations & guidelines regarding data privacy and ethical AI use are prompting organizations to adopt governance frameworks to ensure compliance.
• Increasing AI Adoption: As industries highly integrate AI technologies, the need for strong governance practices to reduce risks and ensure responsible usage is growing.
• Rising Consumer Awareness: The rise in public concern about data privacy, bias, and ethical implications of AI is driving companies to implement transparent governance policies.
• Technological advancements: innovations in AI governance tools, like bias detection and explainability technologies, are improving the ability of organizations to manage AI systems effectively.

Global AI Governance Market: Restraints

• High Implementation Costs: The expenses linked with developing and deploying complete AI governance frameworks can be prohibitive, mainly for smaller organizations.
• Lack of Standardization: The lack of universally accepted guidelines and frameworks develops confusion and inconsistency in AI governance practices, impacting broad adoption.
• Complexity of Integration: Integrating AI governance into current systems and processes can be complex and time-consuming, creating challenges for organizations.
• Resistance to Change: Organizational inertia and resistance to adopting new governance practices can slow down the implementation of AI governance initiatives.

Global AI Governance Market: Opportunities

• Emerging Regulations: The introduction of the latest regulations focused on AI ethics and data privacy provides opportunities for companies to create compliance-oriented governance solutions.
• Cloud-Based Solutions: The growth of AI Governance as a Service (AGaaS) provides scalable, affordable governance options for small and medium-sized enterprises (SMEs), and highly accessible.
• Integration with Other Technologies: Opportunities come from developing AI governance frameworks that integrate with blockchain, IoT, and other emerging technologies, addressing their unique challenges.
• Education and Training Programs: There is a major demand for training and educational resources on AI governance, allowing firms to establish expertise and improve responsible AI practices within organizations.

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Regional Analysis

North America is anticipated to lead the global AI governance market with a 32.9% share in 2024, driven by large AI adoption in commercial and governmental sectors. U.S. and Canadian efforts to balance innovation with regulation, along with early adoption of technologies like machine learning, assist this growth. Europe is also anticipated to play a major role, aiming on data privacy and ethical AI use through regulations like GDPR and the proposed AI Act, while individual countries like the UK develop their own AI governance frameworks.

By Region

North America

• The U.S.
• Canada

Europe

• Germany
• The U.K.
• France
• Italy
• Russia
• Spain
• Benelux
• Nordic
• Rest of Europe

Asia-Pacific

• China
• Japan
• South Korea
• India
• ANZ
• ASEAN
• Rest of Asia-Pacific

Latin America

• Brazil
• Mexico
• Argentina
• Colombia
• Rest of Latin America

Middle East & Africa

• Saudi Arabia
• UAE
• South Africa
• Israel
• Egypt
• Rest of MEA

Recent Developments in the AI Governance Market

• September 2024: The National Information Security Standardization Technical Committee unveiled that it had created the first version of the 'Artificial Intelligence Security Governance Framework' and launched it to the public, which aims on upholding a people-centered approach and adhering to the principle of developing artificial intelligence (AI) for good.
• September 2024: The UN and the OECD announced a partnership on global AI governance, as the speed of technology development and the breadth of its affects the demand for numerous policy ecosystems to work more cohesively. Further, the OECD & the UN would link their efforts to support governments improve the quality and timeliness of their policy response to AI’s opportunities and its risks.
• July 2024: China announced its plans to have mass production of AI-driven humanoid robots by 2025 and leadership in the sector by 2027, the country has published a set of governance guidelines & commitments for AI technology that it aspires to adopt globally.
• March 2024: the Ministry of Communication and Information introduced that the Government of Indonesia provides policies and governance to optimize the benefits and reduce the threats of artificial intelligence (AI) to society through horizontal & vertical approaches.
• October 2023: The United Nations announced the creation of a new AI Advisory Body to help the international community’s efforts to govern artificial intelligence. As for developing economies, AI provides the possibility of leapfrogging outdated technologies and bringing services directly to people who need them most. The transformative potential of AI for good is difficult even to grasp.

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