Analyst Commentary: A services business model is crucial to realize the value of AI

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Pages: 9
Tables, Charts,
     & Figures:
Publication Date: 3Q 2020
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Many technologies that support great economic value are not monetized directly and have to be supported by some other business model. Although artificial intelligence (AI) adoption is driving considerable growth in semiconductor revenue, the conditions for a successful licensing or software as a service (SaaS) business model for software have not been met. The best hope seems to be an IT services approach centering on exposing and making addressable the productivity gains that AI and machine learning (ML) offer the final customer.

Key Questions Addressed:

  • What business models are emerging for AI products?
  • Will the eventual business model be more like hardware, software, or an IT service?
  • What are the most common IT services in the AI sector?
  • What barriers exist to monetizing AI?
  • How can the industry define a business model to overcome these barriers?

Who Needs This Report?

  • Enterprises deploying AI and ML
  • IT services vendors
  • Startups in the AI space
  • Investor community

Table of Contents

Omdia View
More like hardware?
More like software?
Or more like an IT service of some kind?


List of Charts, Figures, and Tables

  • Deep learning chipset revenue by chipset type, world markets: 2019–25
  • AI software revenue share by business model, world markets: 2025
  • Monthly AI contracts by use case: 1Q20
  • AI-related IT services deals by type: 2010–20
  • Percentage of contracts mentioning each service