The size of the smart building AI and machine learning market is forecast to triple between 2020 and 2025, reaching $3.3bn by the middle of decade.
In a new report, Stockholm-based consultancy Memoori has put together a comprehensive market analysis, evaluating the AI and machine learning offerings of 255 companies.
Growth in these tech developments in coming years will be driven partly by AI accounting for an ever greater proportion of existing building systems, displacing older generations of edge devices.
R&D in smart building tech is increasingly focused on automation, and companies such as Smart Spaces and Matterport have told PlaceTech about their AI-driven research to streamline processes and automate problem solving.
The Memoori report delves deeper into these trends. Its key findings include:
Market size to triple: Memoori’s report estimates that the market for AI and machine learning in smart commercial buildings generated total revenues of $1.11bn in 2020 and forecasts it will grow by 24.3% CAGR through to 2025, nearly tripling in value to about $3.3bn.
Security and management are key concerns: More than 45% of companies are providing solutions related to security and access control, and 43% for the space/occupancy and people movement market. The market for AI-enabled energy management and sustainability services is also growing rapidly and attracting a considerable number of new market entrants, with 32% of vendors now offering services in this space.
AI-powered hardware is more valuable in smart buildings than in other sectors: Memoori estimates that hardware revenues make up 35.5% of the market. The majority of this comes from edge devices, particularly AI-enabled cameras. Analysis of the wider AI solutions market shows a much heavier weighting towards software-generated revenues, but the relative importance of computer vision solutions for the smart buildings market means hardware revenues constitute a significant proportion of the market – and will continue to do so.
Funding: Since 2010, Chinese firms have received the largest amount of total funding, totalling more than $6.3bn, compared to $3.9bn for US firms. These two countries are by far the largest in terms of private AI investment.
The future: AI is still in its embryonic phase in terms of development and adoption within commercial buildings, and it could be five to 10 years before AI-powered automation becomes a reality for most smart building systems.