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AI-as-a-Service: Democratizing AI For Scale

March 8, 2022 4286 1 AI

AI-as-a-Service: Democratizing AI For Scale

Artificial Intelligence can add significant economic value with respect to India. To help AI deployments at scale and speed, more attention is needed towards the evolving AI adoption models that are shaping the marketplace, particularly AI-as-a-Service (AIaaS). NASSCOM, in collaboration with the German Development Agency India, GIZ, initiated this research with the aim to demystify AIaaS as a concept and understand the evolution of new consumption models in India. It attempts to define AIaaS, its components and the various players that make up the ecosystem. The study also defines the AIaaS value-chain and analyzes the overall adoption maturity in India. Finally, the report ends with a sneak preview of what the future holds for India; collaboration, democratization of AI mandate going beyond IT, addressing talent shortfall, and the emergence of Edge computing as a key enabler providing an opportunity for wider adoption.

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Key Highlights

Cloud Computing and AI Are The Key Factors Driving Global AIaaS Adoption

  • Global AI market grew 45% in 2021, to reach US$219bn by 2025; Cloud Computing also kept pace, expanding at 55% between 2020 and 2021, fast-tracked by the Pandemic
  • AIaaS combines the capabilities of Cloud and AI to enable deployments at scale, to grow 5X to US$41bn by 2025
  • Mature Cloud technologies and emergence of 3rd party AI/ML tools are a perfect launchpad for AIaaS solutions

India Has Potential To Democratize AI And Expand Domestic Adoption

  • Add US$500bn in Gross Value to the economy which is 10% of the US$5tn GDP goal
  • India has a mature technology ecosystem which is also the largest adopter of AI in India; also Retail, Banking and Manufacturing
  • Large SME base, particularly in Manufacturing which can drive the AI adoption wave in India
  • India has an annual supply of 300-320K AI & Big Data professionals in the Tech sector, while the demand is estimated to be 430-450K professionals; highlighting a shortfall of 130K.

Current AIaaS Models Gaining Traction In India

  • API-based Process Automation Solutions
  • Data Annotation Services (US$7bn potential for India)
  • ML Development (off-the-shelf, plug-and-play)
  • AI Managed Services (horizontal and vertical solutions)
  • AI-on-the-Edge (Inference-as-a-service, deployed on devices)

The Future Of AIaaS Is Bright In India

  • Market-driven collaboration initiatives between Technology majors/Large MNCs and niche, domain-specific AIaaS start-ups mainly in areas of joint GTM, product and solution development, and newer delivery models
  • Gradual adoption of Low-code-No-code and move towards phantomization to benefit businesses contemplating AI
  • Edge provides an opportunity for wider adoption; Integration of AI on Cloud and on the Edge is already underway
  • Addressing the challenges of ecosystem readiness, skillsets, technology, and innovation shall ensure India’s ascent as a global hub for AIaaS similar to the leading status in SaaS

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