Artificial Intelligence Infrastructure to Surpass US$100 Billion - Analytics Insight:

AI infrastructure market to surpass US$100 billion by 2028, driven by cloud-based AI platforms and advanced servers

The artificial intelligence infrastructure market is set for exceptional growth, with global spending projected to exceed US$100 billion by 2028. A recent report from IDC's Worldwide Semiannual Artificial Intelligence Infrastructure Tracker highlights rapid advancements driven by rising investments in cloud computing and AI technologies.

AI Infrastructure Growth Trends

In the first half of 2024, organisations increased spending on AI infrastructure by 37% year-over-year, reaching US$31.8 billion. This marks nine consecutive periods of double-digit growth, primarily fuelled by investments in servers for artificial intelligence deployments. These servers accounted for 89% of total spending, underscoring their importance in the evolving AI infrastructure market.

Cloud-based AI platforms emerged as a major growth area. In 1H24, 65% of total AI server spending went towards cloud and shared environments. Hyperscalers, cloud service providers, and digital platforms led the charge, expanding their capabilities to support AI workloads. In contrast, traditional enterprises were slower to adopt on-premises AI infrastructure solutions.

Accelerated Servers Dominate the AI Infrastructure Market

Servers embedded with accelerators represented 58% of the total AI server infrastructure spending in 1H24, reflecting a 63% year-over-year increase. IDC predicts accelerated servers will dominate over 60% of the market by 2028, growing at a compound annual growth rate (CAGR) of 19%. This demand stems from their efficiency in handling compute-heavy AI tasks.

Storage Growth and Cloud Computing Integration

AI infrastructure storage spending rose by 36% in 1H24, driven by the growing need to manage vast datasets for AI model training and inference. Cloud deployments accounted for 56% of total storage spending, reflecting the critical role of cloud computing in scaling AI infrastructure. The rise of cloud-based AI platforms is reshaping how organisations store and access data, with storage systems designed to optimise performance in distributed environments.

Regional Insights on AI Infrastructure Adoption

The United States leads global AI infrastructure spending, contributing nearly 50% of the total in 1H24. It is followed by China (23%), the Asia-Pacific region (16%), and Europe, the Middle East, and Africa (10%). Over the next five years, IDC anticipates the Asia-Pacific region to achieve the fastest CAGR of 20%, surpassing other regions in growth potential.

By 2028, AI infrastructure spending is projected to reach US$107 billion. Cloud-based servers will account for 75% of total server spending, while accelerated servers will command 56% of the market.

Sustainability in AI Infrastructure

The current trend highlights the increasing demand for AI’s energy consumption and environmental impact. It is important for organisations to undertake cost-effective means of designing and developing datacentre infrastructures. It will encourage more energy consumption efficiency. Sophisticated cooling technologies and energy-efficient form factors are likely to trend big time in the future AI infrastructure.

Conclusion

By the end of this year, the artificial intelligence infrastructure market possibilities will be on the verge of entering a new era. There is fast growth in advanced processing, buying of cloud-based AI architectural platforms, accelerated servers, and complex storage. Therefore, sustainability of infrastructure will continue to be a great deal as organisations integrate AI solutions. The AI infrastructure market, with projected spending set for more than US$100 billion in 2028, has firmly shown how to reshape global advanced technologies.