Artificial Intelligence - Israel

Israel

The market size in the Artificial Intelligence market is projected to reach US$1.03bn in 2024.
The market size is expected to show an annual growth rate (CAGR 2024-2030) of 28.33%, resulting in a market volume of US$4.60bn by 2030.
In global comparison, the largest market size will be in the United States (US$50.16bn in 2024).

Definition:
Artificial intelligence (AI) is a branch of computer science that focuses on creating machines able to perform tasks traditionally requiring human intelligence, such as perception, reasoning, and learning. The Artificial Intelligence (AI) market includes a wide range of applications, such as speech recognition, image processing, and autonomous vehicles and has seen rapid growth in recent years due to advancements in technology and increased investment. The Artificial Intelligence (AI) market includes software, hardware, and services that enable organizations to develop and deploy AI applications.

Structure:

The Artificial Intelligence (AI) market is structured into six markets based on the technology:

The Computer Vision market covers applications that enable computers to interpret and understand digital images and video data.
The Machine Learning market covers the use of algorithms to enable computer systems to learn from data.
The Natural Language Processing market covers applications that enable computers to understand, interpret, and generate human language.
The Artificial Intelligence Robotics market covers the combination of AI, machine learning, and engineering to create intelligent machines that can perform tasks autonomously.
The Autonomous & Sensor Technology market covers machines and systems that operate independently by using sensors, AI, and machine learning to respond to changes in their environment.
The Generative AI market covers artificial intelligence that involves creating models capable of generating new content, such as images, videos, and text, which are indistinguishable from content created by humans.

Additional Information:

The Artificial Intelligence (AI) market comprises three key performance indicators: market sizes, market sizes by industry, and users of AI tools. Market sizes are generated by the funding amount of Artificial Intelligence (AI) companies. Key players of the Artificial Intelligence (AI) market include companies such as Google, Open AI, IBM, and Microsoft.

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Analyst Opinion

The Artificial Intelligence Market in Israel has been rapidly growing, fueled by factors such as increasing investment in AI technologies, government support for innovation, and a highly skilled workforce. The market's elevated growth rate can also be attributed to the development of advanced AI sub-markets, such as AI robotics, autonomous & sensor technology, and natural language processing. With a strong focus on research and development, Israel is well-positioned to continue driving the growth of the AI market in the region.

Customer preferences: With the rapid growth of Artificial Intelligence in Israel, there has been a noticeable shift in consumer preferences towards personalized and efficient solutions. This trend is driven by the country's tech-savvy population and the growing awareness of the potential of AI technology. Consumers are increasingly embracing AI-powered virtual assistants, chatbots, and smart home devices to simplify daily tasks and enhance convenience. Additionally, there has been a rise in the use of AI-based healthcare solutions, such as telemedicine and personalized treatment plans, reflecting a growing demand for efficient and accessible healthcare services.

Trends in the market: In Israel, the Artificial Intelligence market is experiencing a surge in demand for AI-powered solutions in various industries such as healthcare, finance, and agriculture. This trend is expected to continue with the government's focus on promoting AI research and development. Additionally, there is a growing adoption of AI-powered chatbots and virtual assistants for customer service and data analysis. This trajectory indicates a shift towards more efficient and personalized services, creating new opportunities for industry stakeholders. However, it also raises concerns about data privacy and the potential displacement of human jobs. Overall, the rise of AI in Israel has the potential to revolutionize industries and drive economic growth.

Local special circumstances: In Israel, the Artificial Intelligence market is thriving due to the country's strong technological advancements and highly educated workforce. Additionally, Israel's small size allows for easy collaboration and knowledge sharing among companies and researchers. This, combined with its supportive government policies and investor-friendly environment, has led to a vibrant startup ecosystem for AI. Furthermore, Israel's unique geopolitical situation has also fostered the development of AI solutions for security and defense, giving the market a strong competitive edge in these areas.

Underlying macroeconomic factors: The growth of the Artificial Intelligence market in Israel is heavily influenced by macroeconomic factors such as government support, technological advancements, and investment in research and development. As a country with a strong focus on innovation and a thriving startup ecosystem, Israel has a favorable regulatory environment and provides significant funding for AI initiatives. This has resulted in the country becoming a global leader in AI research, development, and adoption. Furthermore, Israel's strong economic growth and stable political climate contribute to a supportive business environment for the AI market. Additionally, as the demand for AI technology continues to grow globally, Israel's highly skilled workforce and strong academic institutions make it an attractive destination for international investment in the AI industry.

Methodology

Data coverage: The data encompasses B2B, B2G, and B2C enterprises. Figures are based on the funding values from different industries for the market.

Modeling approach / Market size:Market sizes are determined through a top-down approach with a bottom-up validation, building on a specific rationale for each market. As a basis for evaluating markets, we use annual financial reports, funding data, and third-party data. In addition, we use relevant key market indicators and data from country-specific associations such as GDP, number of internet users, number of secure internet servers, and internet penetration. This data helps us estimate the market size for each country individually.

Forecasts:In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited to forecast digital products and services due to the non-linear growth of technology adoption. The main drivers are the level of digitalization, the number of secure internet servers, and the revenue of the Public Cloud market.

Additional Notes: The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russian-Ukraine war are considered at a country-specific level. The market is updated twice a year. In some cases, the market is updated on an ad-hoc basis (e.g., when new, relevant data has been released or significant changes within the market have an impact on the projected development). Data from the Statista Consumer Insights Global survey is weighted for representativeness.