Explainable AI Market by Offering (Services, Software), Deployment (Cloud-based, On-premise), Application, End-Use - Global Forecast 2024-2030

Explainable AI Market by Offering (Services, Software), Deployment (Cloud-based, On-premise), Application, End-Use - Global Forecast 2024-2030

The Explainable AI Market size was estimated at USD 7.02 billion in 2023 and expected to reach USD 8.42 billion in 2024, at a CAGR 20.24% to reach USD 25.52 billion by 2030.

Explainable artificial intelligence (XAI) includes technologies that enable the interpretability and transparency of AI systems, allowing users to understand and trust the decision-making processes of complex algorithms. XAI is crucial, especially in applications where AI-driven decisions impact individuals or businesses. The growing need for accountability and ethical AI practices, particularly in sectors such as finance, healthcare, and law, is elevating the demand for explainable AI. Regulatory requirements emphasizing transparency and interpretability further contribute to the adoption of XAI solutions. Additionally, the increasing complexity of AI models and their applications heightens the demand for explainability, ensuring that decisions can be comprehended and validated. Striking the right balance between explainability and performance hinders the development and deployment of XAI systems. The integration of XAI in sectors, including healthcare for enhanced diagnostics and personalized treatment plans, fuels the market growth of the explainable AI market. Continuous innovations in the development of novel explainable artificial intelligence solutions by market vendors are expected to create opportunities for market growth.

Regional Insights

In the Americas, the explainable artificial intelligence (XAI) market is experiencing substantial growth, driven by a heightened awareness of the importance of transparent and interpretable AI systems. North America, in particular, plays a pivotal role in advancing the market, benefitting from a strong emphasis on technology innovation and regulatory frameworks. As the demand for trustworthy AI decision-making processes continues to rise, the Americas remain at the forefront of embracing and integrating explainable AI solutions, creating a dynamic landscape for innovation and adoption in the region. In the Asia-Pacific region, the explainable artificial intelligence (XAI) market is driven by a growing recognition of the need for transparent AI decision-making. Countries such as China and India are actively adopting XAI solutions across diverse industries, including finance, healthcare, and manufacturing. The region benefits from rapid technological advancements and an increasing focus on ethical AI practices. European countries, in particular, are adopting XAI solutions due to the presence of a strong regulatory framework and a commitment to transparency in AI decision-making processes. As the demand for interpretable AI systems continues to rise, EMEA remains a significant region in the advancement and integration of explainable AI solutions.

Market Insights

Market Dynamics

The market dynamics represent an ever-changing landscape of the Explainable AI Market by providing actionable insights into factors, including supply and demand levels. Accounting for these factors helps design strategies, make investments, and formulate developments to capitalize on future opportunities. In addition, these factors assist in avoiding potential pitfalls related to political, geographical, technical, social, and economic conditions, highlighting consumer behaviors and influencing manufacturing costs and purchasing decisions.

Market Drivers

Increasing need for transparency and interpretability in AI systems
Growing adoption of AI across various industries worldwide
Regulatory initiatives and guidelines emphasizing transparency and accountability

Market Restraints

High cost of development of AI explainable solutions

Market Opportunities

Continuous research & development to introduce novel AI explainable solutions
Growing adoption of XAI that identifies and mitigates biases in AI models

Market Challenges

Complexity in the integration of certain AI explainable solutions with AI systems

Market Segmentation Analysis

Offering: Advancements in integrated software solutions for high data processing allows clearer analytics and decision-making processes
Deployment: Growing preference for cloud-based explainable AI deployment due to its affordability and ease of access
Application: Expanding application of explainable AI in drug discovery and diagnostics for personalized treatment
End-Use: Emerging application of explainable AI in aerospace and defense sector enabling transparent decision making and risk analysis

Market Disruption Analysis

Porter’s Five Forces Analysis
Value Chain & Critical Path Analysis
Pricing Analysis
Technology Analysis
Patent Analysis
Trade Analysis
Regulatory Framework Analysis

FPNV Positioning Matrix

The FPNV positioning matrix is essential in evaluating the market positioning of the vendors in the Explainable AI Market. This matrix offers a comprehensive assessment of vendors, examining critical metrics related to business strategy and product satisfaction. This in-depth assessment empowers users to make well-informed decisions aligned with their requirements. Based on the evaluation, the vendors are then categorized into four distinct quadrants representing varying levels of success, namely Forefront (F), Pathfinder (P), Niche (N), or Vital (V).

Market Share Analysis

The market share analysis is a comprehensive tool that provides an insightful and in-depth assessment of the current state of vendors in the Explainable AI Market. By meticulously comparing and analyzing vendor contributions, companies are offered a greater understanding of their performance and the challenges they face when competing for market share. These contributions include overall revenue, customer base, and other vital metrics. Additionally, this analysis provides valuable insights into the competitive nature of the sector, including factors such as accumulation, fragmentation dominance, and amalgamation traits observed over the base year period studied. With these illustrative details, vendors can make more informed decisions and devise effective strategies to gain a competitive edge in the market.

Recent Developments

Fujitsu collaborates with Informa D&B to incorporate explainable AI technology for financial-commercial information industry

Fujitsu Limited has recently entered into a strategic agreement with Informa D&B in Spain to bring new value through the implementation of explainable AI technology (XAI). This collaboration aims to provide access to highly sophisticated data in a more agile and efficient manner for the 4.5 million users in Spain, thereby significantly enhancing the quality of business information solutions. XAI is specifically designed to ensure trust, understanding, and compliance with ethical and regulatory standards.

GyanAI Launches the World’s First Explainable Language Model and Research Engine

GyanAI has recently announced the explainable language model and natural language understanding engine built on its proprietary technology. GyanAI is a powerful knowledge engine that offers a unique blend of extractive and generative text, providing reasoning for its output.

Temenos to Offer Explainable AI on Oracle Cloud Infrastructure

Temenos, a cloud banking platform and member of the Oracle Partner Network, has announced the availability of its Explainable AI technology on the Oracle Cloud Infrastructure. Temenos XAI provides customers with the capability to explain, in plain language, how automated decisions are made using AI. This brings transparency and explainability to AI processes in the banking industry.

Strategy Analysis & Recommendation

The strategic analysis is essential for organizations seeking a solid foothold in the global marketplace. Companies are better positioned to make informed decisions that align with their long-term aspirations by thoroughly evaluating their current standing in the Explainable AI Market. This critical assessment involves a thorough analysis of the organization’s resources, capabilities, and overall performance to identify its core strengths and areas for improvement.

Key Company Profiles

The report delves into recent significant developments in the Explainable AI Market, highlighting leading vendors and their innovative profiles. These include Abzu ApS, Alphabet Inc., Alteryx, Inc., ArthurAI, Inc., C3.ai, Inc., DarwinAI, DataRobot, Inc., Equifax Inc., Fair Isaac Corporation, Fiddler Labs, Inc., H2O.ai, Inc., Intel Corporation, Intellico.ai s.r.l, International Business Machines Corporation, ISSQUARED Inc., Kyndi, Inc., Microsoft Corporation, Mphasis Limited, NVIDIA Corporation, Salesforce, Inc., SAS Institute Inc., Squirro Group, Temenos Headquarters SA, Tensor AI Solutions GmbH, Tredence Analytics Solutions Pvt. Ltd., and ZestFinance Inc..

Market Segmentation & Coverage

This research report categorizes the Explainable AI Market to forecast the revenues and analyze trends in each of the following sub-markets:

Offering
Services
AI/ML Enabled Service
Consulting Services
Cutting Edge AI/ML Research
Data Engineering Services
Data Science Advisory Services
Training & Education Services
Software
Automated Reporting Tools
Integrated Software
Interactive Visualization Platform
Standalone Software
Deployment
Cloud-based
On-premise
Application
Drug Discovery & Diagnostics
Fraud & Anomaly Detection
Identity & Access Management
Predictive Maintenance
Supply Chain Management
End-Use
Aerospace & Defense
Automotive
Banking, Financial Services, & Insurance (BFSI)
Energy & Utilities
Healthcare
IT & Telecommunications
Media & Entertainment
Public Sector & Government
Retail & eCommerce
Region
Americas
Argentina
Brazil
Canada
Mexico
United States
California
Florida
Illinois
New York
Ohio
Pennsylvania
Texas
Asia-Pacific
Australia
China
India
Indonesia
Japan
Malaysia
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
Europe, Middle East & Africa
Denmark
Egypt
Finland
France
Germany
Israel
Italy
Netherlands
Nigeria
Norway
Poland
Qatar
Russia
Saudi Arabia
South Africa
Spain
Sweden
Switzerland
Turkey
United Arab Emirates
United Kingdom

Please Note: PDF & Excel + Online Access - 1 Year