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Artificial Intelligence

Global Economic Impact of AI: Facts and Figures

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Sharmistha Chatterjee Hacker Noon profile picture

@sharmi1206Sharmistha Chatterjee

https://www.linkedin.com/in/sharmistha-chatterjee-7a186310/

Summarization of Research Insights from Emerj, Harvard Business Review, MIT Sloan, and Mckinsey

Wall Street, venture capitalists, technology executives, data scientists — all have important reasons to understand the growth and opportunity in the artificial intelligence market to access business growth and opportunities. This gives them insights on funds invested in AI and analytics as well potential revenue growth and turnover. Indeed, the growth of AI, continuing research, development of easier open source libraries and applications in small to large scale industries are sure to revolutionize the industry the next two decades and the impact is getting felt in almost all the countries worldwide.

To dive deep into the growth of AI and future trends, an insight into the type and size of the market is essential along with (a) AI-related industry market research forecasts and (b) data from reputable research sources for insight into AI valuation and forecasting.

The blog is structured as follows :

  • To provide a short consensus on well-researched projections of AI’s growth and market value in the coming decade.
  • To understand the per capita income and GDP of each country from businesses driven by AI and analytics.

Impact of AI is so widespread, touching and vivid that:

IBM’s CEO claims a potential $2 trillion dollar market for “cognitive computing”).

Google co-founder Larry Page states that “Artificial intelligence would be the ultimate version of Google. The ultimate search engine is capable of understanding everything on the web. It will become so much AI driven that in near future ,it would understand exactly what you wanted and it would give you the right thing. We’re nowhere near doing that now. However, we can get incrementally closer to that, and that is basically what we’re working on”.

Different sectors exhibit dynamics in terms of adopting and absorbing AI, leading to different levels of economic impact.

Source

On comparing different industry-sectors we see from the figure above:

In high-tech industries like Telecom and media has already adopted AI relatively rapidly and looking for transformations in all possible avenues. They are then followed by Consumer, Financial Services and Professional Services.

Healthcare and Industrial Sector are adopting AI slowly. Energy and Public Sector are the slowest adaptors to this transition.

Further, the economic impact in the telecom and high-tech sector could be more than double that of healthcare in 2030. If the national average of macroeconomic impact is 100, healthcare might experience 40 percent lower impact (i.e. 60). The fast and rapid adopters like the telecom and high-tech sector are highly influenced by AI and could experience 40 percent higher impact (i.e. 140) than the national average.

Several internal and external factors specific to a country or a state, have been known to affect AI-driven productivity growth, including labor automation, innovation, and new competition. In addition, certain micro factors, such as the pace of adoption of AI, and macro factors such as a country’s global connectedness and labor-market structure also plays a certain factor to the size of the impact.

The end result is to grow the AI value chain and boost the ICT sector, making an important economic contribution to an economy.

Production channels: Direct economic impact of AI aims to automate production and save cost. It primarily considers three production dimensions. Firstly it includes calling labor and capital “augmentation”, where new AI capacity is developed, deployed, and operated by new engineers and big data analysts. Second, investment in AI technologies saves labor as machines take over tasks that humans currently perform. Thirdly, better AI-driven innovation saves overall cost (including infrastructure), enabling firms to produce the same output with the same or lower inputs.

Augmentation: Relates to increased use of productive AI-driven labor and capital.

Substitution: AI-driven technologies offer better results in the field like automation, where it has been found to be more cost-effective. It has also discovered ways and means to substitute other factors of production. Advanced economies could gain about 10 to 15 percent of the impact from labor substitution, compared with an impact of 5 to 10 percent in developing economies.

Product and service innovation and extension: Motivation for investment in AI beyond labor substitution can produce additional economic output by expanding firms’ portfolios, increasing channels for products and services (for e.g. AI-based recommendations), developing new business models, or combination of the three.

Externality channels: It serves as one of the external channels where the application of AI tools and techniques can contribute to economic global flows (for e.g. chatbots, news aggregation engines). Such flow happens inter-country (states and geographical boundaries) and even between countries that facilitate more efficient cross-border commerce. It is found that countries that are more connected and participate more in global flows would clearly benefit more from AI. Further AI could boost supply chain efficiency, reduce complexities associated with global contracts, classification, and trade compliance.

Wealth creation and reinvestment: AI is contributing to higher productivity of economies, efficiency gains. Further innovations result in an increase in wages for workers, entrepreneurs, and firms in the form of profits, higher consumption, and more productive investment.

Transition and implementation costs: Several costs incurred while executing the transition to AI like organization restructuring costs, adoption to new solutions, integration costs, and associated project and consulting fees are known to affect the transition in a negative way. Businesses should do a trade-off between cost and benefit analysis and correctly strategize their roadmap.

Negative externalities: AI could induce major negative distributional externalities affecting workers by depressing the labor share of income and potential economic growth.

The following figure illustrates the detailed overall economic impact sustained due to the wider adoption of AI techniques and strategies by businesses.

Source

AI-driven businesses have led to a positive impact on the growth of revenue over consecutive years. More so, the statements made by renowned founders, CEOs, entrepreneurs and visionary leaders is evident from the figure below as it shows the impact of AI on global GDP, the maximum being obtained from venture-backed startups.

Source: https://emerj.com/ai-sector-overviews/valuing-the-artificial-intelligence-market-graphs-and-predictions/

“Tractica forecasts that the revenue generated from the direct and indirect application of AI software is estimated to grow from $643.7 million in 2016 to $36.8 billion by 2025. This represents a significant growth curve for the 9-year period with a compound annual growth rate (CAGR) of 56.8%.”

Tractica has taken a conservative adoption of AI in the hedge fund and investment community, with an assumption that roughly 50% of the hedge fund assets traded by 2025 will be AI-driven. Under this estimate, the algorithmic trading use case remains the top use case among the 191 use cases identified by Tractica.

Further as per reports from Tractica, the market for enterprise AI systems will increase from $202.5 million in 2015 to $11.1 billion by 2024, as depicted in the following figure.

View of Worldwide growth of AI revenue, Source — Tractica

The growth forecasts over the next decade clearly show China’s dominance over the AI market yielding a significant increase in GDP, followed by USA, Nothern Europe, and other nations.

In China, AI is projected to give the economy a 26% boost over the next 13 years, measuring an equivalent of an extra $7 trillion in GDP, helping China to rise to the top. As North America’s companies are widely using AI, the adaptation is at an accelerating phase that it can expect a 14.5% increase in GDP, worth $3.7 trillion.

As the GDP growth varies across continents and nations, the level of AI absorption also varies significantly between the country groups with the most and the least absorption. The below figure demonstrates statistics of economies with higher readiness to benefit from AI. Such countries achieve absorption levels about 11 percentage points higher than those of slow adopters by 2023, and this gap looks set to widen to about 23 percentage points by 2030. This further gives an indication of the digital divide created from AI, between advanced and developing economies.

Source: Mckinsey

The resulting gap in net economic impact between the country groups with the highest economic gains and those with the least is likely to become larger, for e.g. a large gap in economic impact between the leading and the lagging — between Sweden and Zambia. The gap could widen from three percentage points in 2025 to 19 percentage points in 2030 in terms of net GDP impact.

AI is internationally recognized as the main driver of future growth and productivity, innovation, competitiveness and job creation for the 21st century. However, there remain certain technical challenges, that need to be overcome to take it to the next step. The key challenges include

  • Labeled training data
  • Obtaining sufficiently large data sets. 
  • Difficulty explaining results
  • Difficulty generalizingScaling challengesRisk of bias

Apart from the common technical challenges, risks, and barriers faced by organisations implementing AI are evident.

It is now the responsibility of policymakers and business leaders to take measurable actions to address the challenges, support researchers, data scientists, business analysts, and all included in the AI ecosystem to drive the economy with huge momentum.

As rightly quoted by Stephen Hawking, Famous Theoretical Physicist, Cosmologist, and Author:

“Success in creating AI would be the biggest event in human history. Unfortunately, it might also be the last, unless we learn how to avoid the risks.”

References

  1. Valuing the Artificial Intelligence Market, Graphs and Predictions: https://emerj.com/ai-sector-overviews/valuing-the-artificial-intelligence-market-graphs-and-predictions/
  2. NOTES FROM
    THE AI FRONTIERMODELING THE IMPACT OF AI ON THE WORLD ECONOMY: 
    https://www.itu.int/dms_pub/itu-s/opb/gen/S-GEN-ISSUEPAPER-2018-1-PDF-E.pdf
  3. USA-China-EU plans for AI: where do we stand: https://ec.europa.eu/growth/tools-databases/dem/monitor/sites/default/files/DTM_AI%20USA-China-EU%20plans%20for%20AI%20v5.pdf
  4. https://hbr.org/insight-center/interacting-with-ai
  5. https://sloanreview.mit.edu/projects/reshaping-business-with-artificial-intelligence/

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AI

iPhone 13 To Introduce a New Feature From Apple Watch

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In his weekly newsletter, Bloomberg journalist Mark Gurman, who often conveys an accurate understanding of Apple’s plans, said the iPhone 13 may have an Apple Watch-inspired always-on mode.

Always-On Mode Feature

The Apple Watch Series 5 and Apple Watch Series 6 have displays that can stay on with low refresh rates and brightness, allowing the user to see their watch even in low light. The same functionality on the iPhone 13 can allow users to see details such as time, date, and notifications at all times.

The always-on iPhone display will be simplified with a larger iPhone 13 battery and an improved display. Previous rumors have suggested that the iPhone 13 will be getting bigger batteries, which could eliminate some of the extra power consumption of the always-on display.

What’s in It for Gamers?

Some iPhone 13 models are also widely expected to incorporate “ProMotion” power updates up to 120Hz, making movements in games appear smooth. This is believed to be facilitated by the use of the OLED LTPO display panel, which can vary in degree of refreshment while using a limited amount of power in order to save battery life.

Pros & Cons of iPhone 13

The device is expected to get heavier and thicker to support advanced displays and larger batteries. But since they will have the always-on feature, users might feel that it can be justified. The always-on display feature could be limited to advanced Pro models that are expected to get the LTPO display technology with ProMotion performance.

Earlier this year, leaker Mark Weinbach said the iPhone 13 will feature an always-on display, although it is important to note that Weinbach does not have a certified record. He said the always-on mode will look like a “toned down lock screen,” where the clock and battery are always visible, and notifications are displayed “with bars and symbols.”

The “Look” Factor

The iPhone 13 is also expected to offer several other enhancements, including an improved performance with the “A15” chip and enhanced camera capabilities, but the design of the iPhone 13 models is expected to be quite similar to the iPhone 12 models.

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Source: https://1reddrop.com/2021/07/28/iphone-13-to-introduce-a-new-feature-from-apple-watch/?utm_source=rss&utm_medium=rss&utm_campaign=iphone-13-to-introduce-a-new-feature-from-apple-watch

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Artificial Intelligence

AI is the Secret to Ultimate Consistency in Visual Online Branding

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The future of the graphic design industry is heavily affected by advances in artificial intelligence. Therefore, designers need to understand what AI is and the role it is playing in their industry.

Many people associate AI (shorthand for artificial intelligence) with science fiction scenarios, such as self-thinking computers or autonomous robots, rather than say, creating a logo. They see AI as either a beautiful or terrible thing when it actually leads to a world that closely matches our preconceptions. This is because AI is not usually an apparent new technology screaming for attention in the foreground, but rather is seamlessly integrated into traditional business processes to come up with the best solutions for concrete problems. It should come as no surprise that AI is gaining traction in the field of graphic design. For example, a number of new design systems rely more on AI than ever before. These changes will be even more mainstream in the near future.

AI Becomes More Prominent in the Field of Graphic Design

AI is bringing an end to the traditional creative process, especially in graphic design. Both designers and end-users are nervous about the changes that it has created. Designers worry about their job security and falling out of love with their profession as the processes become more automated and monotonous. Users are worried that they will have to purchase products devoid of human touch.

These concerns are somewhat valid but often overblown, despite some claiming AI will put designers out of work. In general, the creative process has always relied on inspiration from preexisting ideas. This reality has not changed as AI becomes more engrained in the design process. The only difference is that the quality of designs is superior and can complete the process much more efficiently.

The process of designing high quality graphics is laborious and exhausting. It inevitably requires a high level of training and a considerable investment of your time. In recent decades, significant breakthroughs in software, hardware capabilities, 3D printing and other technology has drastically changed the design and development process. However, another major evolution is already unfolding. AI advances have unleashed many new opportunities that will transform the graphic design industry even further. Existing hardware and software technology is already highly sophisticated and offers many huge benefits for designers; new machine learning capabilities enable this technology to be more like an assistant than a mere tool.

The use of AI to support image processing or layout generation has already led to very practical accelerations and simplifications. Its foundations date back to the 1960s with Georg Nees’ work, but in recent years many major breakthroughs have been made that have made new image processing capabilities possible. This has been due to increasingly sophisticated algorithms and higher computing power.

The Proliferation of AI in Graphic Design Could be a Boon for Uniformity in Visual Branding

One concern that some designers and organizations raise about the growing reliance on artificial intelligence in graphic design is that it could alter the brand images of long-standing organizations. Intuitively, this seems like a valid issue.

However, in actuality, the opposite is likely true. In fact, artificial intelligence is arguably necessary for organizations to create a more consistent visual branding strategy and create a better user experience by improving online designs.

Here are some reasons that using graphic design processes that rely on artificial intelligence is ideal for visual branding consistency.

Use of high-quality design templates

A number of new automated design platforms like Canva rely heavily on artificial intelligence. They have analyzed the highest performing designs to come up with an array of design templates for their users.

This is one of the most important benefits for companies that are trying to create a visually consistent brand image. They can keep using the same templates for their designs, which reduces the number of changes that could lead to unintentional inconsistencies in the presentation of the brand.

Machine learning can identify subtle brand details that might influence customers

Some visual branding elements are very obvious to the nature of a brand. Others are far more subtle. However, even the subtle design elements can be very important to followers of the brand.

Machine learning technology is able to analyze existing visual graphics pertaining to a brand. They can spot small details that might be very important to customers that would be overlooked by new members of the design team.

Drastically increasing the precision official branding

Artificial intelligence also makes it a lot easier to design graphics to be far more uniform. It relies a lot less on the dexterity of the designer because they can use automated processes to pinpoint the placement of new visual elements. They can also use AI to pull existing visual elements rather than creating them all from scratch.

Image Credit: Licensed from Shutterstock – By Laurent T

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Source: https://datafloq.com/read/ai-secret-ultimate-consistency-visual-online-branding/16696

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AR/VR

4 Use Cases of Augmented Reality in 2021

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Abhishek Dave

Augmented reality is a technology that lets you interact with 3D models, objects, places, animals, humans, everything in real life. It lets you create and visualize things from the real world in your device which can be used in different sectors like Manufacturing, Retail, Construction, Entertainment, Education, and many more for different purposes.

1) AR in Education

The best use of AR is in education where students can learn and interact with the topics, they don’t have to imagine what it feels like to be in space or how the solar system works, they can simply visualize it with Augmented Reality

2) AR for Industries

Machine elements are tricky to manufacture but even trickier to design if you can’t visualize them. With Augmented Reality, one can simply study and learn the structure of 3D models, the assembly of them, be it knuckle joint- cotter joint, anything you can visualize and learn with Augmented Reality. To perform 3D model collaboration AR is being used by many MNCs.

3) AR for Retailers

AR has turned out to be a blessing for Retailers. People can try them from the comfort of their space, they can share their looks and buy them directly from one platform. Be it Jewellery, Clothing, Eyewear, House Hold things, etc. This will definitely give your prospects some comfortable buying features.

4) AR for Marketing

The biggest benefit of AR is for Marketers. They can uniquely promote their brand using different social channels. One can host Virtual events and Expos using these technologies and market their product globally. Many international companies are using AR to run marketing campaigns to attract the masses, especially millennials, and GenZ.

Augmented Reality has unlocked the possibilities of creating and learning new things every day. We at Melzo.com are playing our part in it. If you want to create AR, VR content yourself and explore these new booming technologies then you should definitely try this free tool.

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
Click here to access.

Source: https://arvrjourney.com/4-use-cases-of-augmented-reality-in-2021-2a1e8fb8f3fd?source=rss—-d01820283d6d—4

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AR/VR

4 Use Cases of Augmented Reality in 2021

Published

on

Abhishek Dave

Augmented reality is a technology that lets you interact with 3D models, objects, places, animals, humans, everything in real life. It lets you create and visualize things from the real world in your device which can be used in different sectors like Manufacturing, Retail, Construction, Entertainment, Education, and many more for different purposes.

1) AR in Education

The best use of AR is in education where students can learn and interact with the topics, they don’t have to imagine what it feels like to be in space or how the solar system works, they can simply visualize it with Augmented Reality

2) AR for Industries

Machine elements are tricky to manufacture but even trickier to design if you can’t visualize them. With Augmented Reality, one can simply study and learn the structure of 3D models, the assembly of them, be it knuckle joint- cotter joint, anything you can visualize and learn with Augmented Reality. To perform 3D model collaboration AR is being used by many MNCs.

3) AR for Retailers

AR has turned out to be a blessing for Retailers. People can try them from the comfort of their space, they can share their looks and buy them directly from one platform. Be it Jewellery, Clothing, Eyewear, House Hold things, etc. This will definitely give your prospects some comfortable buying features.

4) AR for Marketing

The biggest benefit of AR is for Marketers. They can uniquely promote their brand using different social channels. One can host Virtual events and Expos using these technologies and market their product globally. Many international companies are using AR to run marketing campaigns to attract the masses, especially millennials, and GenZ.

Augmented Reality has unlocked the possibilities of creating and learning new things every day. We at Melzo.com are playing our part in it. If you want to create AR, VR content yourself and explore these new booming technologies then you should definitely try this free tool.

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
Click here to access.

Source: https://arvrjourney.com/4-use-cases-of-augmented-reality-in-2021-2a1e8fb8f3fd?source=rss—-d01820283d6d—4

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