Software Development AI Market Forecast to Reach $580.4 Million by 2025

The Market for Software Development AI is forecast to reach $580.4 million by 2025, growing at a CAGR of 22.5% from 2020 to 2025. Software sector is booming primarily due to the implementation of ground-breaking and useful artificial intelligence technologies. Growing interest in artificial intelligence such as expert systems to solve the project’s problems and make the code in understandable format far simpler leads to the growth of the artificial intelligence market in software development. The market is witnessing growth due to the reduced efforts, time and cost of the software application being aided by artificial intelligence.

Key Takeaways
  • Growth in big data and increasing digitally connected customers are majorly driving the Software Development AI Market.
  • Asia – Pacific has dominated the market share in 2019 due to the technological advancements and increasing adoption of deep learning and NLP technologies in this region
  • Expert systems application is analysed to grow at highest rate owing to the exploration of asset tracking applications for these systems.
  • As AI technology is still in its early stage of product life cycle, the workforce possessing in-depth knowledge of this technology is limited, which is a major hindrance in the market growth.
Programming Language – Segment Analysis
By programming language, the Software Development AI Market is segmented into python, R, Lisp, Prolog, Java and others. Python language held the major share in 2019 as it is being used by majority of the developers for software development. It is the most preferable language because of its syntax simplicity and versatility. Python is very encouraging for machine learning for developers as it is less complex as compared to C++ and Java. It also a very portable language as it is used on platforms including Linux, Windows, Mac OS, and UNIX. It is also likable from its features such as Interactive, interpreted, modular, dynamic, portable and high level which make it more unique than Java. All the above factors are majorly contributing towards booting the demand for python in software development AI market.
Application – Segment Analysis 
The various end users assessed include expert systems and project management. Expert system application is analysed to be witnessing significant growth rate during the forecast period 2020-2025. A broad range of asset tracking applications for creating expert systems which are currently being explored includes defining and identifying the issues, determining and offering the set of examples which are rising the market of the Artificial Intelligence in Software Development and estimated to have huge growth during the forecast period. The capital expenditure of major companies in the creating expert systems and project management has also escalated significantly since the last decade.
Geography – Segment Analysis
By geography, Asia – Pacific segment is expected to gain the highest market growth during the forecast period 2020-20205. China, Japan, Australia, and India are among the major countries driving the AI market in APAC. The increasing adoption of deep learning and NLP technologies in finance, agriculture, marketing, and law applications is also driving the market in this region. Growing e-commerce, online streaming, and increasing internet penetration have resulted in the growth of marketing industries. Marketers are now looking for more sophisticated and state-of-the-art marketing software solutions for large and ever-growing consumer base. This has resulted in the adoption of AI-enabled software solutions for marketing. In security, with increasing incidents of cyber-attacks and a growing cyber-war in the region, organizations and governments are focusing on robust defense infrastructure. APAC, especially China, Japan, and South Korea, is considered the largest market for industrial robots. Industrial robots generate a huge volume of data and numerous software, which is used for training robots. This would act as one of the major drivers for the artificial intelligence market in APAC.
Drivers – Software Development AI Market 
Growth in Big Data and Increasing digitally connected Customer
Big data and artificial intelligence market are becoming part of business organizations driven by the availability of data from sources such as the Internet of Things (IoT). Nowadays, companies are striving to analyze the consumer data obtained from CRM systems, product reviews, and media comments to understand their customers at a granular level, making their marketing more targeted and effective. Traditional software development is not designed to support the changes, involving a series of successive stages including manually writing code, preparing requirements, designing software, and testing to establish that the final product meets specifications. Artificial intelligence (AI) is disrupting this process by creating scalable and efficient workflows to drive productivity and reduce time-to-market. Though many software companies are still in the early stages of AI application, the use of the technology is growing steadily across the enterprise.
 
Challenges – Software Development AI Market
Lack of Quality Tools and Expertise
The most significant barriers AI and machine learning developers’ face in improving AI app development also include the cost of materials and lack of necessary skills or training. Just 10% are having to deal with the challenges of working with and integrating into legacy systems, a finding that indicates AI and machine learning app development is happening in relatively new business units and development centers. Professional services of a data scientist or a developer are needed to customize an existing ML-enabled AI service. As AI technology is still in its early stage of product life cycle, the workforce possessing in-depth knowledge of this technology is limited. Thus, the impact of this restraining factor will likely remain high during the initial years of the forecast period of software development AI market.
Market Landscape
Product launches, acquisitions, and R&D activities are key strategies adopted by players in the Software Development AI Market. Software Development AI driver market is expected to be dominated by major companies such as N-iX, QBurst, Intellectsoft, Softserve, RapidMiner, KONUX, and AI Foundry among others.
Acquisitions/Technology Launches/Partnerships
  • In May 2020, The US Air Force (USAF) has launched a competition to design the artificially intelligent software, called Skyborg, that would control its planned fleet of loyal wingman unmanned air vehicles (UAV)..
  • In May 2020, Microchip Technology Inc. has developed its VectorBlox Accelerator Software Development Kit (SDK) based on AI that helps developers take advantage of Microchip’s PolarFire FPGAs for creating low-power, flexible overlay-based neural network applications without learning an FPGA tool flow.