Latest predictions from IDC suggest that while AI is driving infrastructure growth from cloud providers and data centres, and fuelling demand for semiconductors, it’s not yet the primary driver for PC sales.
► PC sales next year will be driven by Windows 11 upgrades
► AI infrastructure spending to surpass $100 billion within five years
► Semiconductor growth will be driven by AI and HPC
In one of its recent reports, the analyst firm predicted that the global market for AI infrastructure is on track for unprecedented growth and poised to surpass $100 billion by 2028. Spending on computer and storage hardware infrastructure for AI deployments was up by 37% year-over-year in the first half of 2024, reaching $31.8 billion.
A separate prediction noted that demand for artificial intelligence (AI) and high-performance computing (HPC) will drive demand for semiconductors up by over 15% in 2025, with cloud data centres amongst the big buyers. Demand for memory products is expected to rise by over 24%, while non-memory sales are expected to be up 13%, driven by the need to equip servers, high-end mobile phones and WiFi 7 devices with the most advanced chips.
But IDC’s report on the global market for personal computing devices predicted that 2024 growth would come out at 3.8% in 2024, reaching 403.5 million units. But despite the buzz around AI PCs, that has not driven growth, which has been constrained due to the overall macro environment. IDC said that companies are continuing to evaluate the need for AI PCs, most of which have a higher cost.
PC Recovery expected in 2025
However, it also noted that 2025 is expected to be a year of recovery for PCs, with growth anticipated at 4.3%, driven mainly by commercial upgrades from Windows 10 to Windows 11. ‘There seems to be a big disconnect between supply and demand as PC and platform makers are gearing up for AI PCs and tablets to be the next big thing, but the lack of clear use cases and a bump in average selling prices has buyers questioning the utility’, said Jitesh Ubrani, research manager, IDC.
In the first half of 2024 servers accounted for 89% of total spending
AI infrastructure sales meanwhile continue to grow at an accelerated pace, driven primarily by investment in servers for AI deployments. In the first half of 2024 (1H24), servers accounted for 89% of total spending, growing 37% compared to the same period of 2023. AI infrastructure deployed in cloud and shared environments accounts for 65% of the total server spending in AI for 1H24, as hyperscalers, cloud service providers and digital service providers expanded. Traditional enterprises, by contrast, have lagged behind in adopting on-premises AI infrastructure.
Servers with an embedded accelerator are preferred for AI, accounting for 58% of the total server AI infrastructure spending – and growing 63% in the first half of 2024.
Storage spending in AI infrastructure has been driven by the need to manage large datasets required for training AI models, as well as storage of training, checkpoints and repositories of data for inference phases. This category reported a 36% year-over-year growth rate in 1H24 with 56% of the spending coming from cloud deployments.
US leads the way
The US leads AI infrastructure spending, accounting for almost half of the total 1H24; the EMEA share though was only 10% with China accounting for 23% and APJ (Asia-Pacific-Japan) 16%). Over the next five years, IDC expects growth in EMEA to be 13%.
IDC expects AI adoption to continue growing at a remarkable pace
By 2028, IDC forecasts that AI Infrastructure spending will reach $107 billion with servers deployed in cloud environments at 75% of the total and accelerated servers around 56% of the total market spending.
‘IDC expects AI adoption to continue growing at a remarkable pace as hyperscalers, CSPs, private companies, and governments around the world are increasingly prioritising AI. Growing concerns around energy consumption for AI infrastructure will become a factor in datacentres looking for alternatives to optimise their architectures and minimise energy use” said Lidice Fernandez, group vice president, worldwide enterprise infrastructure trackers.
