October 1, 2024
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To understand the future of generative AI and its impact on the economy, we must recognise the breakthroughs that have made it possible. These innovations have taken decades of research and development. Today, generative AI is more accessible than ever, thanks to the open-source approach. This accessibility means businesses of all sizes can use its capabilities to drive innovation and help them thrive in an increasingly competitive market. Continue reading as we explore how Generative AI boosts the global economy and why you should invest now.
The Rise of Generative AI
The journey of generative AI can be traced back to foundational advancements in machine learning (ML) and deep learning (DL) over the last few decades. One of the earliest and most notable cases of AI was in 2016 when Google's AlphaGo AI defeated a world-champion Go player. This event played a major role in bringing AI into the public spotlight, showing its potential to tackle complex problems. What followed was a series of innovations that would change how we interacted with AI, from the voice assistants in our smartphones to the autonomous driving features in cars.
While AI tools like ChatGPT, GitHub Copilot and Stable Diffusion might seem like recent innovations, they come from decades of research, advancements and investments in AI technologies. For instance, advancements in artificial neural networks have enabled AI to perform previously impossible tasks like language translation, image recognition and art generation. These systems rely heavily on powerful GPUs and vast amounts of data, driving the growth of natural language processing and generative models that can produce text, images, music and videos.
We can already see how quickly generative AI is advancing. Google has introduced features powered by PaLM 2 and its Search Generative Experience, highlighting how important generative AI is becoming in their products. At the same time, Meta has been quickly updating its Llama models, releasing versions from Llama in 2023 to Llama 3.3 in 2024, showing how fast innovation is happening in this field. And that's not all, another example of Generative AI advancement could be OpenAI's Sora, an AI model that can create realistic and imaginative videos from text instructions.
The Growing Market for Generative AI
In the first five months of 2023 alone, funding for generative AI reached a major $12 billion. Between 2017 and 2022, venture capital and other private investments in generative AI grew by an average compound rate of 74% annually. If we compare, the overall AI investments rose by 29% annually during the same period. [See source]
For example, the National Science Foundation (NSF) announced a $140 million investment in seven new AI research institutes across the United States in 2023. Another significant investment is Microsoft and OpenAI’s collaboration of up to $115 billion for the Stargate supercomputer [See source]. This shows that generative AI is growing at scale across diverse industries.
And it does not end here, the market value of Generative AI is about US$36.06 billion in 2024 and is expected to grow at a rate of 46.47% every year until 2030. So, by the end of the decade, the market for Generative AI could reach US$356.10 billion. [See source]
Why Invest in Generative AI?
Given the rapid growth of Generative AI, businesses cannot afford to ignore its adoption. Here's why investing in Generative AI is crucial:
Cost Savings
Generative AI can significantly cut operational costs, especially in industries where repetitive tasks and large-scale content creation are prevalent. Klarna, a Sweden-based financial technology company uses AI tools like DALL-E and Midjourney for marketing image production, saving around $10 million annually. These tools reduced the need for costly stock imagery and slashed image development time from six weeks to seven days. Using Generative AI also helped Klarna reduce external marketing costs by 25%. [See source]
Boosting Productivity
Generative AI boosts employee productivity by automating mundane tasks, allowing workers to focus on higher-value work. BBVA, a financial services company saw remarkable results, with employees saving nearly 3 million hours annually using Generative AI tools. Over 80% of employees who tested generative AI reported saving more than two hours a week. This time savings translates into improved efficiency, faster decision-making and the ability to handle more complex tasks. [See source]
Operational Efficiency
Generative AI is a powerful solution for streamlining operations and reducing reliance on external services. For instance, Unilever’s integration of generative AI into its operations helped reduce the need for external law firms, cutting costs and enhancing internal processes. By handling legal tasks in-house through Generative AI, companies can achieve higher efficiency and significant savings on legal services, which can be reinvested into business growth. [See source]
Improved Customer Service
Investing in generative AI empowers businesses to offer personalised and engaging customer experiences. AI-driven chatbots, virtual assistants, and content generators tailor services based on user preferences. For example, companies using AI for personalised marketing experience up to a 20% increase in customer satisfaction rates. Generative AI enables businesses to meet customer demands in real time, which means you get customer loyalty and retention. [See source]
Innovation and Revenue Growth
Generative AI cuts costs and drives revenue growth by automating content generation and enhancing customer experiences. It enables businesses to stay competitive, adapt quickly and create innovative products and services. In industries like fintech, retail and entertainment, AI opens new revenue streams. For instance, AI-generated content in the entertainment industry is projected to generate over $7.5 billion by 2027. [See source].
NexGen Labs: Your Partner in Generative AI Innovation
For businesses looking to invest in Generative AI, NexGen Labs is your trusted partner in generative AI. Here's how we help:
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AI Strategy Consulting: Get tailored guidance for AI, including readiness assessments and strategic roadmaps.
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R&D Partnerships: Collaborate with NexGen Labs for AI research, accessing the latest NVIDIA hardware and clusters.
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Technical Training & Workshops: Our sessions cover AI model training, data engineering, and machine learning. Learn to manage AI infrastructure with workshops using Hyperstack and NexGen Cloud.
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Infrastructure & Deployment Advisory: Optimise generative AI and deep learning with NexGen Cloud’s scalable GPUaaS solutions.
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Generative AI Use Cases & Integration: Discover and integrate impactful Generative AI applications like RAG, chatbots, and custom LLMs.
Explore how NexGen Labs can help you lead in generative AI innovation.
FAQs
What is Generative AI?
Generative AI refers to AI systems that can create new content, such as text, images, and music, by learning patterns from large datasets. These systems can generate original outputs based on the input they receive.
How can Generative AI benefit my business?
Generative AI can automate repetitive tasks, improve decision-making, enhance customer experiences, and drive innovation, leading to cost savings and revenue growth.
Is Generative AI only useful for large companies?
No, generative AI is accessible to businesses of all sizes, offering scalable solutions that improve efficiency and competitiveness, regardless of company size.
How can NexGen Labs help my business implement Generative AI?
NexGen Labs provides tailored AI strategies, R&D partnerships, technical training, and infrastructure deployment advisory to help businesses integrate and leverage generative AI effectively.
What makes NexGen Labs a trusted partner in Generative AI?
NexGen Labs brings deep expertise, cutting-edge solutions, and personalised guidance, ensuring that businesses use the full potential of generative AI for growth and innovation.
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