GLOBAL DEFENCE INTELLIGENCE MARKET (2024 - 2030)

The Defence Intelligence Market was valued at USD 7.72 billion in 2023 and is projected to reach a market size of USD 16.75 billion by the end of 2030. Over the forecast period of 2024-2030, the market is estimated to grow at a CAGR of 11.7%. 

Artificial Intelligence (AI) in Defence is the integration of advanced technologies with defence equipment to increase its efficiency and applications. In many developed countries, government invests in their Defence sector. These investments are applied in the research and development of new technologies, for evolution of new technologies and for developing advanced equipment that can be used during wars, training and other scenarios. AI equipped with defence systems handles large volumes of data efficiently and such data is self-regulated and self-controlled due to its enhanced computing and decision- making abilities. Therefore, modifying defence weapons, tools and equipment with the updated technologies is driving the AI in defence market towards growth.

Key Market Insights:

• According to a report by Stockholm International peace Research Institute in the month of April 2023, the US, Russia, China, India and Saudi Arabia collectively accounted for 63% of Defence expenditure in the year 2022.
• Global military expense rose by 3.7% in 2022 and reached US$ 2,240billion.
• In the year 2022, regarding the US research and development budget, the Army requested US$ 15 million for AI and machine learning applied research, US$ 10.2 million for AI and machine learning basic research, and US$ 909,000 for AI and ML.
• In the month of June 2022, The Indian Ministry of Defence launched 75 newly developed artificial intelligence (AI) products and technologies during the first-ever AI in Defence symposium and exhibition in New Delhi, the capital of India. These combine autonomous systems, AI platform automation, command, control, communication, computer (C4), blockchain-based automation, intelligence, surveillance & reconnaissance (ISR), intelligent monitoring systems, cyber security, etc.
• In July 2022, The United States Air Force signed a contract worth US$ 1.25 million with ZeroEyto to purchase an AI gun detection solution for the service’s unmanned aerial vehicles (UAVs) at the Dover Air Force Base, Delaware, US. ZeroEyes’ technology enavles drones to detect handheld weapons for base protection.

Defence Intelligence Market Drivers:

Rising Investments in the development of AI-Enabled Solution to strengthen Military capabilities

The evolution of autonomous military system drives the adoption of AI in the military market. The latest AI enabled system helps to enhance the efficiency of military system and strengthen their capabilities in the war field. Hence, the Defence forces of developed and leading countries have hiked their investment to boost the deployment of AI on army platforms. There have been multiple major international conflicts in the recent years including Russia-Ukraine war, the Syrian Civil war, the Saudi Arabia and Yemen conflict, etc. Such conflicts give birth to the procurement of advanced AI-enabled weapon systems and newer technologies into existing systems to make them more efficient.

• Increasing adoption of Artificial Intelligence in Unmanned Aerial Vehicles (UAV)

UAVs or drones based on the can be employed in the army for security missions. These UAVs are manufactured with various sensors and cameras that enable them to collect real-time information about the terrain and detect risks of potential threats for multiple applications, including warfare systems and Cyber security. Drones help the military force to understand the situational awareness during Intelligence, Surveillance and Reconnaissance (ISR) missions.  

Additionally, progress in AI, machine learning and their integration with UAVs allow the UAV manufacturers to advance their product portfolio. The makers of UAVs are entering into partnerships, collaborations and contracts for the adoption and development of UAVs with AI technologies boost the growth of the AI in Defence market.

Defence Intelligence Market Restraints and Challenges:

• Absence of protocols and standards for deployment of AI in military applications

The evolution, management and successful implementation of AI systems require certain protocols. As most of the AI potentialities are being developed by private companies, there is lack of co-operation between governments and companies in developing these technologies. This is due to the fact that companies are reluctant to share their intellectual property with the government, as there are no standard regulation and rules. They also face problems in Defence acquisition processes and the lengthy and complicated legal framework involved and therefore many companies decline to work with government organizations.

• Issues related to Data privacy and Security

The integration of AI with warfare systems requires data that can be applied for training and building reliable AI programs. This data is pivotal to develop and enhance AI systems. Several AI-enabled autonomous systems need encrypted communication and data transfer links and as data transmitted from these systems is vulnerable and prone to Cyberattacks, hacking and other malfunctions. Thus, concerns related to sharing of sensitive and confidential military data are acting as a key challenge to the growth of Defence Intelligence Market. 

Defence Intelligence Market Opportunities:

• Inclusion of Quantum Computing in AI

A quantum computer works on the incidents such as “superposition” and “entanglement”. Through these conceptual benefits, a quantum computer can outperform any normal computer. The power of quantum computing can also be incorporated in AI systems. This will supercharge the AI systems which are now dependent on the binary-based classical computing and enhance their capabilities. For example, AI can shrink through a larger data set and analyze it to give a better model which leads to more accurate predictions.

This could be applied to deal with the security and privacy of Defence. Having the capacity to process large data, the information can be processed much faster locally than cloud. For instance, data from all sensors in an autonomous AI-powered tank can be processed swiftly enabling quicker decision making. Quantum computing will play a huge role in Cybersecurity as this will prepare the systems for faster identification of threats and take necessary countermeasures. This makes the space for opportunities in military market.

GLOBAL DEFENCE INTELLIGENCE MARKET REPORT COVERAGE:

Defence Intelligence Market Segmentation:   

• By Offering:

• Hardware

• Processor
• Memory
• Network

• Software

• AI Solutions

• Cloud
• On-Premise

• AI Platforms

• Services

• Deployment & Integration
• Upgrades and Maintenance
• Software Support
• Others

The Software segment is estimated to grow at the highest CAGR in the AI in military market during the projected period. The growth of the Software segment is due to the significance of AI software in strengthening the IT framework to prevent scenarios of security breach. As data privacy policies and regulatory compliances have become strict, the ask for Cybersecurity solutions using AI is predicted to rise in the near future. IBM is the leading provider of software powering AI.

• By Application:

• Warfare Platforms
• Cybersecurity
• Logistics & Transportation
• Surveillance & Situational Awareness
• Command & Control
• Battlefield Healthcare
• Simulation & Training
• Threat/Target Tracking and Monitoring
• Information Processing
• Others

Based on Application, Cybersecurity segment is noticed as the most dominated segment in the recent years. The global cybercrime rate has hiked due to the emergence of new tools and technologies. Corporations and governments are swiftly adopting AI-based technologies that can detect, prevent and respond to Cyber-attacks.

Among the list mentioned above, Information processing is assumed to be fastest growing segment in the future years. AI is applied to process huge cache of data that provides valuable information. It aids in culling and aggregation of information which assists military personnel in recognizing patterns and derive correlations in data sets.

• By Technology:

• Machine Learning

• Deep Learning
• Supervised Learning
• Unsupervised Learning
• Reinforcement Learning
• Generative Adversarial Learning
• Others

• Natural Language Processing
• Context-Aware Computing
• Computer Vision
• Intelligent Virtual Agent
• Others

Based on technology, Machine Learning is the most dominant segment in 2023, and it is the fastest-growing segment as well during the forecast period, 2024-2030. Deep learning specifically has applications in a variety of places. It is the most used technology and is used in the training of almost all types of datasets.

• By Region:

• North America
• Europe
• Asia Pacific
• Middle East & Pacific
• South America

As per the research, North America holds the largest market share in 2023 and is expected to continue its domination during the forecast period. The rise is due to the highest Defence expenditure from the United States. Increasing spending on research and development of advanced Defence equipment and increasing procurement of AI-enabled devices for Defence operations from the United States Department of Defence drive the market's growth across the region.

In the fiscal year 2022, the United States Department of Defence (DoD) planned to invest US$ 874 million in artificial intelligence (AI) related technologies to boost deterrence against potential adversaries like China. DoD also emphasises on expanding efficiencies in command and control, computing, and logistics.                          

COVID-19 Impact Analysis on the Global Organic Spices Market:

The Global Defence sector witnessed slight impact of the COVID-19 pandemic. The Global military expenditure reached approximately US$ 2 trillion in 2020. With exponentially rising military intelligence capabilities, it became imperative to use AI and Analytics in the Global Defence sector to monitor various parameters of vehicle or personnel. Similarly, the high Defence spending by various military powerhouses of the world had led to significant investment into this sector of the Global Defence Agencies, leading to a relatively minimal impact on the market in the pandemic.

Latest Trends/ Developments:

• Replacement of Conventional Defence equipment with modern AI-enabled machine

The latest trend in the Defence sector is superseding conventional Defence equipment with smart robots and intelligent machines. It is speculated that future war systems will be dominated by unmanned systems and automatic weapons that provide enhanced operational efficiency and accuracy during warfare scenarios. Therefore, hiking investment in research and development and rising adoption of next-generation technologies in Defence will drive market growth during the forecast period.

• Software Segment will showcase exceptional growth in the forecast period

The software segment in the AI and analytics market is anticipated to represent enormous growth in the forecast period. The growth is credited to the increasing Defence spending and the development of advanced AI software and related software development kits. AI software installed in computer systems performs several complex operations. It collects data from hardware systems and processes in AI systems to result in an intelligent response. The AI software encompasses machine learning, virtual assistant and speech and voice recognition.

Key Players:

• BAE Systems plc,
• IBM Corporation
• Leidos
• Lockheed Martin Corporation
• Raytheon Technologies Corporation
• Charles River Analytics, Inc
• Shield AI
• SparkCognition, Inc
• Thales Group

Recent Developments:

• In April 2023, Raytheon Technologies Corporation has launched their latest AI-assisted EO/IR system, RAIVEN. This solution enables military pilots to obtain faster and more accurate threat identification.
• In March 2023, Northrop Grumman Corporation, in collaboration with Shield AI, has been opted by the US Army for the Future Tactical Unmanned Aircraft System (FTUAS) competition Increment 2. This competition aims to replace the RQ-7B Shadow tactical Unmanned Aerial system (UAS) with modern abilities.
• In January 2023, Lockheed Martin Corporation launched its new AI model Aegis. This model is used to enhance the operational efficiency of Agis Combat System.
• In July 2022, Raytheon Technologies has chosen the C3 AI Platform to deliver state-of-the-art AI and Machine Learning (ML) potentialities, presenting a readily available solution for the US Army’s Tactical Intelligence Targeting Access Node (TITAN) program.
• In June 2022, Lockheed Martin Corporation launched new AI/ML technology enable solution.