In the ever-evolving landscape of technology, 2023 has been a year full of significant innovation that continues to transform the way people work, live and interact with one another.
Artificial intelligence (AI) has grown at a tremendously fast pace and has developed into a cornerstone of the industry. The release of ChatGPT late last year has meant AI and generative AI (GenAI) have taken the world by storm. GenAI is being implemented into almost every industry, from healthcare and education to gaming and finance.
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The increased demand for GenAI systems has made large language models, which the systems are trained on, the must-have thing for every Big Tech company and start-up.
The rapid rise of AI has brought increased pressure on governments to decide how the emerging technology will be regulated. In 2023, the world’s first AI Safety Summit was held in the UK where world leaders and industry professionals met to discuss the responsible use of AI and its ethical ramifications.
“AI regulation is in flux and not consistent across jurisdictions, but directionally it is moving towards more regulation everywhere, albeit with different approaches,” Josep Bori, research director at GlobalData, told Verdict.
With a heavy focus on AI and GenAI throughout the year, the concept of the metaverse, once seen as the next big thing in the industry, encountered a severe drop in interest. Meta continued to release new virtual reality and augmented reality headsets throughout the year despite interest in the technology dropping as the focus switched to advancements in AI.
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By GlobalDataGlobal AI deals increased in 2023
The interest and advancement in AI and GenAI throughout 2023 has led to an increase in funding for the sector.
The value of global AI deals totalled $331bn throughout 2023, an increase from $211bn in 2022, according to GlobalData’s deal database.
In 2023, the value of global AI deals peaked in the second quarter (Q2), with the sector raising $119bn. This was a slight increase over the beginning of the year, which saw deals valued at $104bn. However, in Q3 the value of AI deals fell significantly lower, totalling $68bn.
GlobalData predicts the total AI market will be worth $908.7bn by 2030.
Cloud computing led in tech hiring amid industry lay-offs
Lay-offs have plagued the technology industry throughout 2023 as companies continued to readjust plans after a pandemic spending boom and declining revenues. Big Tech companies including Amazon, Microsoft and Google all announced a series of cuts throughout the year, as well as hundreds of smaller companies and start-ups.
GlobalData’s report, Global Hiring Activity Trends & Signals – Q3 2023, revealed that global hiring activity continued to decline by 29.3% year-on-year and 11% quarter-on-quarter in Q3 2023.
Despite cuts across the technology industry, 2023 saw key technology themes driving hiring across a range of industries. Cloud computing, big data and AI were among the leading technology sectors driving job postings, according to GlobalData's Job Analytics Database.
Cloud computing took the top spot for the most active job postings across the world, with a total of 1.4 million jobs posted since the beginning of the year. This was followed by big data, which had 916,000 active job postings since the beginning of the year.
The future of work saw the most hires in 2023, according to GlobalData. GlobalData's future of work framework has five categories: visualisation, connectivity, automation, collaboration and interpretation.
AI was the fourth most hired sector in 2023 with 498,000 active jobs posted throughout the year, considerably lower than the top three technology sectors.
Technology M&A deals decreased in 2023
Global technology mergers and acquisitions (M&A) activity in 2023 was negatively affected by the same things that have hurt the rest of deal-making throughout the technology industry. High interest rates, regulatory uncertainty, geopolitical tensions and consumer demand led to a weaker advancement in M&A deals throughout the year.
In 2023, as of 14 December, the value of M&A deals totalled $330bn, a significant drop compared with $626bn in 2022, according to GlobalData's deal database.
The total value of M&A deals in Q2 totalled $119bn, significantly more than Q1, which saw deals peak at $63bn.
However, in Q3, the total value of M&A deals totalled just $93bn. This dropped again in Q4, as of 14 December, with a total of just $55bn.
The biggest M&A deal of the year was Cisco's $28bn offer to purchase enterprise cloud protection company Splunk, according to GlobalData's deal database.
The deal is expected to close out by the end of Q3 of the calendar year 2024, subject to regulatory approval and other customary closing conditions including approval by Splunk shareholders.
