AI Market Boom: Key Insights from Cowen’s 2017 Research Report

Overview of Cowen’s AI Report

Cowen released a research report titled “Artificial Intelligence: The Golden Age of Data Science,” analyzing AI applications from 2016‑2017, company counts, mainstream technologies, and future market forecasts. The author distilled the main viewpoints for quick understanding.

Key Findings

81% of IT leaders are investing in or planning AI projects.

AI is projected to become the biggest driver of productivity gains, with Microsoft positioned as a leader.

Digital marketing, CRM (Salesforce automation), and data analytics are the three most mature AI/ML use cases.

AngelList reports over 2,200 AI startups, more than half founded in the past two years.

Cowen identifies Salesforce, Adobe, and ServiceNow as the top three profit‑generating AI application avenues.

Market Size and Growth

IDC forecasts the AI and cognitive systems market to grow from $8 billion in 2016 to $47 billion in 2020 (CAGR 55%). Software applications account for $18 billion, platforms $5 billion, and services/hardware $24 billion.

IBM estimates a $2 trillion cognitive computing market, with health sciences alone worth $200 billion. Tractica predicts AI applications will rise from $1.4 billion in 2016 to $59.8 billion in 2025 (CAGR 52%).

Startup Financing Surge

AI startup financing increased tenfold from 2011 (67 deals) to 2016 (698 deals). Accenture notes a 20‑fold rise in AI startups, especially in FinTech, health, transportation, and retail e‑commerce.

Emerging Application Areas

Beyond the mature domains, AI/ML potential extends to self‑service, ERP, HRM, and e‑commerce. By 2025, algorithmic trading, image recognition, and patient‑data processing are expected to be major AI applications, while predictive maintenance and content distribution on social media will become the fourth or fifth biggest profit sources.

Machine Learning Profitability

Venture Scanner reports machine learning has generated $3.5 billion in revenue from over 400 companies, far outpacing natural language processing’s $1 billion from 200 companies.

Enterprise Adoption of Intelligent Stacks

Enterprises are expected to adopt intelligent application stacks at scale, integrating machine‑learning algorithms into IT systems to provide predictive insights across the value chain, enabling real‑time optimization of discounts, pricing, and purchase recommendations.

Sources

Forbes: https://www.forbes.com/sites/louiscolumbus/2017/06/11/how-artificial-intelligence-is-revolutionizing-enterprise-software-in-2017