KSA AI Chipsets Market Outlook to 2028

KSA AI Chipsets Market Overview

AI chipsets market size on global level is at USD 20 billion in 2023. This growth is primarily driven by the increasing adoption of AI technologies across various sectors such as healthcare, finance, and automotive.

Several key players dominate the KSA AI chipsets market, including NVIDIA Corporation, Intel Corporation, Qualcomm Technologies, Inc., Advanced Micro Devices, Inc. (AMD) and Huawei Technologies Co., Ltd.

In 2022, NVIDIA announced the establishment of a new AI research center in Riyadh, Saudi Arabia, to enhance the development of AI technologies in the region. This center aims to foster collaboration between academia and industry, promoting innovation and knowledge transfer. This move highlights the increasing investment and focus on AI research and development within the Kingdom.

KSA AI Chipsets Current Market Analysis

The Saudi government's Vision 2030 initiative emphasizes the importance of AI and digital transformation, driving demand for AI chipsets. The government has invested heavily in AI research and development, aiming to position Saudi Arabia as a leader in AI innovation.

The AI chipsets market is significantly impacting various sectors in Saudi Arabia. In healthcare, AI is being used for predictive analytics, patient monitoring, and diagnostic imaging, leading to improved patient outcomes. In the automotive industry, AI chipsets are crucial for developing autonomous vehicles and advanced driver-assistance systems (ADAS).

The Central Region, particularly Riyadh, dominates the KSA AI chipsets market. Riyadh is the hub of technological innovation and houses numerous AI research centers and tech startups. The region's strong infrastructure, availability of skilled workforce, and government support make it the leading area for AI development in the Kingdom.

KSA AI Chipsets Market Segmentation

The KSA AI chipsets market can be segmented based on various factors:

By Application: By application, the KSA AI chipsets market is segmented into Cloud AI, Edge AI and Consumer AI. In 2023, Cloud AI was dominating this segment. KSA already has a well-established cloud infrastructure with ongoing investments in data center expansion. This makes cloud AI a readily deployable solution without the need for significant upfront investments in on-premise hardware.

By Chip Type: By chip type, the market is segmented into GPUs, CPUs and FGPAs. GPUs have dominated over half the contribution of this segment. In 2023, GPUs were dominating this segment. GPUs are architected for parallel processing, meaning they can handle a multitude of tasks simultaneously. This makes them highly efficient for handling the complex computations required by AI workloads, such as deep learning and machine learning algorithms.

By End-User Industry: The market is segmented into Information Technology & Telecom (IT), Healthcare, Government & Public Sectors and others. In 2023, the IT & Telecom sector was dominating this market since these industries mostly rely on heavily on data processing and analysis for various tasks like cloud services, network management, and big data analytics. AI chipsets significantly enhance the efficiency and capabilities of these existing workloads.

KSA AI Chipsets Market Competitive Landscape

Companies

Establishment Year

Headquarters

NVIDIA Corporation

1993

Santa Clara, USA

Intel Corporation

1968

Santa Clara, USA

Qualcomm Technologies, Inc.

1985

San Diego, USA

Advanced Micro Devices, Inc.

1969

Santa Clara, USA

Huawei Technologies Co., Ltd.

1987

Shenzhen, China

The market is dominated by global giants such as NVIDIA, Intel, and Qualcomm, which have a strong presence and extensive product portfolios. These players are driving innovation and setting industry standards, contributing to the rapid growth and adoption of AI chipsets. NVIDIA's CUDA architecture has set industry standards, enabling developers to harness advanced AI capabilities efficiently.

In 2023, Intel announced a strategic partnership with Saudi Telecom Company (STC) to develop AI solutions tailored for the Saudi market, highlighting the increasing collaboration between local and global entities. Intel's AI portfolio includes the Xeon Scalable processors and the Intel Nervana Neural Network Processors, which are designed to accelerate deep learning and AI workloads.

Qualcomm introduced its latest AI chipset, Snapdragon 888, in 2021, which offers advanced AI capabilities for mobile devices. This chipset's advanced capabilities have been adopted by leading smartphone manufacturers, including Samsung, Xiaomi, and One Plus, further solidifying Qualcomm's market presence.

KSA AI Chipsets Industry Analysis

KSA AI Chipsets Market Growth Drivers

Government Initiatives and Investments: The Saudi government's Vision 2030 initiative is a significant driver of the AI chipsets market. As part of this vision, the government has committed to investing heavily in AI technologies and infrastructure. These investments are aimed at positioning Saudi Arabia as a global leader in AI by enhancing the country's technological capabilities and fostering innovation in AI applications.

Rising Adoption of AI in Healthcare: The healthcare sector in Saudi Arabia is increasingly adopting AI technologies, driving the demand for AI chipsets. In 2023, the Ministry of Health announced that the Seha Virtual Hospital has activated the use of Lunit INSIGHT CXR, an AI technology that analyzes chest X-rays, to serve pilgrims during the Hajj season. This widespread adoption of AI in healthcare is expected to continue, further boosting the AI chipsets market.

Technological Advancements in AI Chipsets: Continuous advancements in AI chipset technology are propelling market growth. Modern AI chipsets are becoming more efficient, powerful, and cost-effective, enabling broader application across various industries. Neuromorphic chips can process data up to 1,000 times faster than traditional chips while consuming 10 times less energy.

KSA AI Chipsets Market Challenges

High Costs of AI Chipset Development The development and implementation of AI chipsets are associated with high costs, which can be a significant barrier for many organizations. The average cost of developing and deploying AI chipsets in industrial applications is USD 500,000 per project. These high costs can deter small and medium-sized enterprises (SMEs) from adopting AI technologies, limiting market growth.

Data Privacy and Security Concerns With the increasing use of AI technologies, data privacy and security have become major concerns. AI systems often require vast amounts of data, raising issues related to data protection and compliance with regulations. Ensuring robust data protection measures is crucial for the sustained growth of the AI chipsets market.

KSA AI Chipsets Recent Developments

Oracle launched its AI cloud services in Saudi Arabia, aimed at providing scalable AI solutions to businesses across various sectors. These services include AI-powered analytics, automation, and customer engagement tools. According to Oracle, the introduction of AI cloud services is expected to help businesses enhance their operations and competitiveness, thereby increasing the demand for AI chipsets.

Google Cloud launched an extensive AI training program in collaboration with the Saudi Ministry of Communications and Information Technology (MCIT). The program aims to equip over 10,000 Saudi professionals with AI skills over the next five years. According to Google Cloud, this initiative will enhance the local talent pool and support the growth of AI-driven industries in Saudi Arabia, thereby driving the demand for AI chipsets.

IBM partnered with the Saudi Data and AI Authority (SDAIA) to develop AI-powered solutions for government services. The collaboration includes projects aimed at improving public service delivery, data analytics, and cybersecurity using AI technologies, driving the demand for AI chipsets in government applications.

KSA AI Chipsets Future Market Outlook:

KSA AI chipsets market is expected to continue its robust growth, driven by ongoing government support, technological advancements, and increasing industry adoption.

Future Market Trends:

Integration of AI in Smart Cities Saudi Arabia's ambitious smart city projects, such as NEOM, will drive demand for AI chipsets. These smart cities leverage AI technologies for various applications, including traffic management, energy optimization, and public safety.

AI-Powered Financial Services The financial sector in Saudi Arabia is increasingly adopting AI technologies for fraud detection, risk management, and customer service automation. This growing trend of AI integration in financial services is expected to drive the demand for AI chipsets.

Expansion of AI in Retail and E-commerce The retail and e-commerce sectors in Saudi Arabia are rapidly incorporating AI technologies to enhance customer experience and optimize operations. AI applications in these sectors include personalized recommendations, inventory management, and chatbots. The expansion of AI in retail and e-commerce is a significant trend which will drive the AI chipsets market.
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