Press FAQ

Publication date: 19 May 2022

Australia's Spending on Artificial Intelligence (AI) to Double to $3.6 Billion by 2025, Says IDC

AUSTRALIA, Sydney, May 20, 2022 – According to IDC's latest Worldwide Artificial Intelligence Spending Guide, Australia's spending on AI systems will grow to $3.6 billion in 2025, representing a compounded annual growth rate of 24.4% for the period of 2020-25. Organisations have increased their investment in artificial intelligence (AI) to keep up with the changing digital environment, which aids in better business decision-making and customer service.

“In Australia, we continue seeing a rapid adoption of artificial intelligence systems across various industries, indicating strong demands from Australian organisations in streamlining of core business processes and maximise the power of their organisational data," says Anastasia Antonova, Senior Market Analyst, Data and Analytics, IDC Australia. "It is going to be very importnant for Australian businesses to continue investing in AI tools and platforms to support decision-making, become more digitally resilient, innovative and be one step ahead from competitors”, she added.

With a five-year CAGR of 23.1% banking will be the leading industry in AI spending. The primary goal is to prevent fraud, identify threats advance, and improve the custom recommendation system. The federal/central government is the second-highest spender on AI solutions, with a focus on detecting, monitoring, and responding to personnel and infrastructure threats. Professional Services and retail are the next highest-spending industries. The primary focus area of professional services is to provide better digital assistance by self-regulating and automating mundane software maintenance activities. Retail industries are focusing on improved customer service, expert shopping advisors, and product recommendations, as well as optimized digital supply chain operations.

"To keep up with the changes in the digital environment, more than half the organisations surveyed in Australia are planning to increase their AI spend in 2022," says Vinayaka Venkatesh, Senior Market Analyst at IDC IT Spending Guides, Customer Insights & Analysis. "Organisations have responded more firmly to the changes caused on by the pandemic, increasing their use of AI to improve customer service, business processes, and digital assistance", he added.

The top five use-cases currently account for $0.75 billion, or 40% of total AI spending, and are expected to grow to 1.4 billion by 2025. Investments are directed in augmented customer service agents, augmented threat intelligence and prevention systems, digital assistants, program advisors and recommendation systems, and smart business innovation and automation. These solutions are widely used in the BSFI industry to reduce risk, make better decisions, and provide a better customer service experience. State and federal governments are investing more than 30.5% of total AI spending in Augmented Threat Intelligence and Prevention Systems to identify emerging personal and infrastructure threats and improve public safety.

The leading technology will be software, accounting for more than 52.2 % of AI spending; the largest areas of investment will be in AI applications and Artificial Intelligent Platforms, accounting for more than 57.2 % of total spending, while the rest will go toward AI System Infrastructure Software and AI Application Development & Deployment. The second most important technology is services, which will account for 29.5 % of total AI spending; IT services will account for more than 73.5 % of total spending, with the remainder going to business services. The rest of the spending goes towards hardware with a share of 18.4% of total AI Spending.

The Worldwide Artificial Intelligence Spending Guide  sizes spending for technologies that analyze, organise, access, and provide advisory services based on a range of unstructured information. The Spending Guide quantifies the AI opportunity by providing data for 29 use cases across 19 industries in nine regions and 32 countries. Data is also available for the related hardware, software, and services categories.

Taxonomy Note: The IDC Worldwide Artificial Intelligence Spending Guide  uses a very precise definition of what constitutes an AI Application in which the application must have an AI component that is crucial to the application – without this AI component the application will not function. This distinction enables the Spending Guide to focus on those software applications that are strongly AI Centric. In comparison, the IDC Worldwide Semiannual Artificial Intelligence Tracker  uses a broad definition of AI Applications that includes applications where the AI component is non-centric, or not fundamental, to the application. This enables the inclusion of vendors that have incorporated AI capabilities into their software, but the applications are not exclusively used for AI functions only. In other words, the application will function without the inclusion of the AI component.


About IDC Spending Guides

IDC's Spending Guides provide a granular view of key technology markets from a regional, vertical industry, use case, buyer, and technology perspective. The spending guides are delivered via pivot table format or custom query tool, allowing the user to easily extract meaningful information about each market by viewing data trends and relationships.

For more information about IDC's Spending Guides, please contact Vinay Gupta at

Click here to learn about IDC's full suite of data products and how you can leverage them to grow your business.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, please visit Follow IDC on Twitter at @IDC  and LinkedIn. Subscribe to the IDC Blog  for industry news and insights.