Middle East & Africa Conversational AI Market Forecast to 2031 – Regional Analysis – by Component (Platform and Service), Type (Chatbots and Intelligent Virtual Assistants), Deployment Type (On-Premise and Cloud), and Industry (Retail & E-commerce, Health

The Middle East & Africa conversational AI market was valued at US$ 568.85 million in 2023 and is expected to reach US$ 2,358.61 million by 2031; it is estimated to register a CAGR of 19.5% from 2023 to 2031.

Growing Adoption of Conversational AI in Gaming Industry Bolsters Middle East & Africa Conversational AI Market

Businesses in the digital gaming and interactive entertainment sectors seek innovative ways to use AI to improve player experience. Developers can improve player engagement and the overall gaming experience by utilizing conversational AI. In video games, non-playable characters (NPCs) are characters that players interact and engage with on a regular basis. These characters accompany or guide players throughout the game. Conversational AI in gaming refers to the incorporation of AI technology into video games to allow for more natural and dynamic interactions between players and NPCs, as well as among players themselves. Conversational AI enables dialogue systems in games to mimic real-world conversations, especially between players and non-player characters, by understanding and reacting to user input.

Furthermore, conversational AI allows game developers to enhance their NPC experience. By including chatbots, speech recognition, and natural language processing capabilities, game creators can enhance the ability of NPCs to comprehend and react to player questions, instructions, and conversations in a natural manner. For example, conversational AI could be used to improve virtual characters that function as interactive merchants or quest-givers in massively multiplayer online role-playing games (MMORPGs). With these virtual characters, players can engage in conversation or even lighthearted banter outside of the conventional dialogue tree. With the ability to engage with these AI-driven entities in the same way as other players, users can have a more immersive and socially engaging experience, adding to the game's richness. Thus, all the above factors are expected to propel the demand for conversational AI in the gaming industry, which will fuel the conversational AI market growth during the forecast period.

Middle East & Africa Conversational AI Market Overview

The UAE has always been at the forefront of digital transformation and technical innovation. The UAE's top objective is to leverage its world-class healthcare infrastructure to establish itself as a regional healthcare innovation hub, complete with medical tourism and medical-grade logistics. To cater to this objective, the government of UAE, out of the overall federal budget for 2024, which is AED 64.060 billion, allotted AED 5.2 billion, which is 8% of the total budget to healthcare and community protection. Furthermore, according to ITA, there are various new hospital construction and renovation initiatives underway. This need for modern facilities with the latest medical technologies is being driven by the expanding medical tourism industry. Moreover, the Ministry of Health is working on updating the country's hospitals with cutting-edge technologies aimed at preventing and treating the growing prevalence of noncommunicable diseases, including cardiovascular disease, cancer, and diabetes. Thus, such growing digital transformation in the healthcare industry fuels the growth of the conversational AI market in the UAE.

Middle East & Africa Conversational AI Market Revenue and Forecast to 2031 (US$ Million)

Middle East & Africa Conversational AI Market Segmentation

The Middle East & Africa conversational AI market is categorized into component, type, deployment type, industry, and country.

Based on component, the Middle East & Africa conversational AI market is bifurcated into platform and service. The platform segment held a larger share of the Middle East & Africa conversational AI market share in 2023.

By type, the Middle East & Africa conversational AI market is bifurcated into chatbots and intelligent virtual assistants. The chatbots segment held a larger share of Middle East & Africa conversational AI market in 2023.

In terms of deployment type, the Middle East & Africa conversational AI market is bifurcated into on-premise and cloud. The on-premise segment held a larger share of Middle East & Africa conversational AI market in 2023.

Based on industry, the Middle East & Africa conversational AI market is segmented into retail & e-commerce, healthcare & life sciences, travel & hospitality, BFSI, IT & telecom, media & entertainment, and others. The retail & e-commerce segment held the largest share of the Middle East & Africa conversational AI market share in 2023.

By country, the Middle East & Africa conversational AI market is segmented into South Africa, Saudi Arabia, the UAE, and the Rest of Middle East & Africa. The UAE dominated the Middle East & Africa conversational AI market share in 2023.

Alphabet Inc, Amazon.com Inc., Cognigy GmbH, International Business Machines Corp, Microsoft Corp, Oracle Corp, and SAP SE are some of the leading companies operating in the Middle East & Africa conversational AI market.

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