Generative AI Surge in Asia, Oceania Fueled by Local Solutions

Generative AI software spending in Asia and Oceania will exceed $18 billion by 2028 as businesses increasingly adopt local solutions, according to new research from Omdia.

Omdia’s 2024 Generative AI in Asia and Oceania report examined regional trends from technology vendors developing or deploying large language models.

The research found that the total software revenue for generative AI will grow to $18.3 billion with a compound annual growth rate (CAGR) of 53%.

Technology vendors are driving that growth by building and deploying their own local systems, according to Omdia. The report suggests that generative AI software solutions that focus on Western languages and values may not be suitable for local languages, cultures and use cases.

Companies are instead looking to build their own solutions to better serve their users.

Chinese and South Korean telcos like China Mobile and KT are among the companies adopting their own solutions and developing their own large language models.

Credit: Omdia

The report also highlights efforts from vendors in India and Singapore, including Tech Mahindra and AI Singapore who are developing large language models that support local users.

“Asia and Oceania boast some of the most ambitious vendors in the AI industry building full-stack solutions,” said Lian Jye Su, chief analyst, applied intelligence at Omdia. “Companies such as Alibaba, Baidu, Huawei, Tencent, SK Telecom and KT are developing proprietary cloud AI chips, infrastructure, frameworks, services and solutions, with the vision of creating fully differentiated GenAI products and services tailored to regional contexts.”

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The largest industry for generative AI software in Asia and Oceania is consumer-focused.

Omdia’s report found that most companies building and deploying generative AI solutions are engaged in the consumer business, with the consumer sector expected to be the largest revenue contributor.

Other industries driving revenue include media and entertainment, including providing systems for streaming services and advertising, and the business services sector where generative can provide automation, including virtual assistants and automated report generation.

The top 10 use cases Omdia identified for Asia and Oceania are focused on speech and vision use cases.

Voice and speech recognition, virtual assistants and voice assistants marked three of the four most popular use cases.

Credit: Omdia

The report suggests vendors and end users in Asia and Oceania should work together to identify new revenue opportunities for generative AI software.

Related:Enterprises Embrace Generative AI as Demand Rises, Report

“Eventually, we expect the focus on generative AI localization and data sovereignty to lead into AI sovereignty. Asia and Oceania now understand the paradigm shift brought by generative AI and have started advocating generative AI development that is fully aligned with a country’s identity, characteristics, and needs,” said Su.

“As such, governments need to work closely with generative AI technology suppliers and end-users to build up the local AI infrastructure and ecosystem.”