AI Spending Fuels Cloud Evolution, But Challenges Remain

The rapid growth of generative artificial intelligence (Gen AI) is transforming the cloud infrastructure landscape. According to a report by Nasscom, Gen AI expenditures are expected to increase significantly over the next five years, driving a comprehensive reshaping of cloud infrastructure.

The Rise of Gen AI

Gen AI has already gained significant traction, with over 65% of enterprises adopting the technology. Cloud infrastructure providers are partnering with AI hardware vendors and large language model (LLM) providers to create a platform for startups and service providers to build and offer Gen AI solutions to the Indian market.

Gen AI adoption is on the rise

Cloud Infrastructure Evolution

The growth of Gen AI is driving further cloud adoption, with cloud services providers (CSP) enabling cost savings with pay-as-you-go models and reduced investments. CSPs are also offering seamless integrations to connect Gen AI models to existing systems.

“There exists an intricate relationship between Generative AI and cloud computing. The cloud industry has evolved significantly in response to the unique demands of Generative AI workloads,” the report said.

Challenges Ahead

Despite the promise of Gen AI, the report highlights several challenges that need to be addressed. A significant portion of projects remain in the pipeline stage, and environmental concerns and energy costs are becoming increasingly important.

Gen AI challenges

The Future of Cloud Infrastructure

As Gen AI continues to grow, the cloud infrastructure landscape will need to evolve to meet the unique demands of this technology. With the right partnerships and collaborations, the Indian market is well-positioned to take advantage of the opportunities presented by Gen AI.

Cloud infrastructure evolution