Gen AI Unlocks Promising Prospects for Enterprises: Nasscom Report Technology has taken over and businesses worldwide are making a natural transition toward integrating Gen AI and machine learning.
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Technology has taken over and businesses worldwide are making a natural transition toward integrating Gen AI and machine learning.
A recent report by Nasscom Insights, (National Association of Software and Service Companies) called the 'Cloud & Generative AI - A Synergistic Future' highlighted the massive acceleration in net spending across companies to integrate Generative AI– USD 15 billion in 2023, indicating a comprehensive remodel of cloud infrastructure.
The data was according to McKinsey & Co, who furthered on the fact that enterprises are betting big, and the sum represents 2 per cent of overall software spending, with expected growth to be around 10 per cent in the next 4-5 years.
Although Gen AI excites enterprises in unlocking promising prospects for enterprises, the report stated that cloud infrastructure faces hurdles with rising costs associated with computationally intense work, requires complex integration with existing systems, requires specialized hardware support, and deployment of Gen AI models requires specialized skills says the report.
"End-users need to understand the technology's limitations and navigate issues like data security, bias mitigation, and ethical considerations," said Achyuta Ghosh Senior Director and Head-Insights, Nasscom.
That being said, over 100 companies in India's cloud ecosystem is presently leveraging Gen AI, mainly with the help of partnerships. Cloud infrastructure companies such as AWS, Google Cloud, Azure; AI Hardware firms namely Nvidia, AMD, and Intel; and Data Center plates such as Equinix and teradata are only a few examples of how bug enterprises are unlocking the benefits of AI through partnerships.
The report reveals that cloud infrastructure providers are teaming up with AI hardware vendors and large language model (LLM) providers, collaborating with global players or nurturing domestic startups; Thus creating a platform for startups and service providers to build and offer Gen AI solutions to the Indian market.
Prospects in India
The Nasscom report also showcased that the Indian Government programs on the other hand are helping to promote reach, fund startups, and create open-source datasets contributing to the country's ecosystem's growth. Crucial collaboration between universities and research institutes along with industry partners is helping foster innovation and talent development in the field of Gen AI, according to the report.
Other initiatives included GOI, along with CII launching pilot projects to explore Gen AI applications in specific sectors; Public-private partnerships between government agencies; research institutions, and private companies established to explore industry-specific applications of Generative AI, healthcare (collaboration with AIIMS), or manufacturing which is collaboration with DRDO).
GOI has released the National AI Policy Framework which is drafted with inputs from public consultations involving experts from academia, research institutions, and industry leaders). The framework outlines guidelines for responsible AI growth, data privacy considerations, and ethical use.
Adoption and Usage
The Nasscom report also highlighted a balanced cloud strategy emerging as key for managing Gen AI's growing footprint. Indian domestic IT service market is regarded as one of the fastest growing in the world. Keeping in mind cloud services are a key driver of this growth and businesses are now embracing the advantages it offers to stay ahead of the curve.
Rajiv Ranjan, Associate Director, India Lead - Cloud and Future of Digital, Infrastructure Research, IDC highlighted that the public cloud services market stood at USD8.3 billion in 2023 in India and is expected to grow at 24 per cent CAGR till 2028.
"The market will be driven by strong growth in the platform as a service and software as a service offering, which will be driven a lot by Generative AI offerings. Generative AI is currently used mainly in cloud cost optimization, application development and coding, and cloud workload testing. In the future, we expect to see Generative AI applications in cloud security as well," said Rajiv Ranjan.
Gen AI is quickly gaining strong attention, with as much as 46 per cent of enterprises actively determining use-cases and doing proof of concepts (POCs). Nearly, 50 per cent of the enterprises have adopted some form of Generative AI solutions states Ranjan.
"Though Generative AI is gaining attention, a large number of CIOs are focused on understanding how Generative AI investments would create business value and expected returns. Trust, security concerns, and reliable data platforms are some of the challenges that would hinder Generative AI adoption in India," concluded Rajiv Ranjan.
