IDC says spending on GenAI solutions is poised to more than double in 2024, rocketing to a staggering $151.1 billion by 2027. This exponential surge reflects a compound annual growth rate (CAGR) of 85.9 percent over the forecast period spanning 2023-2027, according to infotechlead.

“Enterprises will commit significantly to minimize the time and expenses associated with enhancing both customer experiences and employee productivity. Subsequently, the focus will pivot towards investments aimed at amplifying revenue streams and overall business outcomes,” Rick Villars, group vice president of Worldwide Research at IDC, said.

IDC anticipates a natural evolution in GenAI spending, foreseeing a transition from experimentation to robust infrastructure development and refined data model creation.

While companies will recalibrate their investments towards AI implementation and the adoption of AI-augmented products and services, the IT industry is poised for a notably swift and extensive pivot towards AI during this period. This shift is fueled by the race among companies to introduce AI-augmented offerings and to support their clientele in AI integrations. For most, AI is positioned to supersede cloud computing as the primary driver of innovation.

GenAI spending will account for a substantial 29.0 percent of overall AI spending, a significant leap from the 10.8 percent observed in 2023. This robust spending trend is anticipated to persist well beyond the developmental phase, with GenAI solutions poised to establish themselves as a cornerstone in the digital business control platforms of enterprises.

“Generative AI has emerged as a pivotal catalyst propelling investments in conventional AI solutions. The synergy between traditional and generative AI unlocks a realm of possibilities across diverse industries,” Ritu Jyoti, group vice president of Worldwide Artificial Intelligence and Automation market research and advisory services at IDC, said.