sofa image | Light Rocket | getty images
Corporate spending on generative AI has surged 500% this year, from $2.3 billion to $13.8 billion in 2023, according to data released by Menlo Ventures on Wednesday.
The report also found that OpenAI reduced its enterprise AI market share from 50% to 34%. Anthropic doubled its market share from 12% to 24%. According to the report, the results of a survey of 600 corporate IT decision-makers at companies with 50 or more employees were released.
Menlo is an investor in Anthropic. OpenAI did not immediately respond to a request for comment.
Tim Tully, a partner at Menlo Ventures, told CNBC in an interview that the power shift is partly due to the advancement of Claude 3.5 and the fact that most companies are using three or more large-scale AI models. He said OpenAI and Anthropic have dominated enterprises’ use of AI models, but people are “juggling models” and that habit is “not well-understood data.”
“The developers are very skilled. They know how to switch between models fairly quickly,” Tully explained. “They are choosing the model that best suits their use case, which will probably be Claude 3.5.”
metaThe market share remained at 16%, and Cohere’s share remained at 3%. Google rose from 7% to 12%, and Mistral fell 1 percentage point to 5% in 2024.
Foundational models such as OpenAI’s ChatGPT, Google’s Gemini, and Anthropic’s Claude still dominate enterprise spending, with large-scale language models receiving $6.5 billion in enterprise investment, according to the report.
Menlo’s report was optimistic about AI agents, a key AI trend and investment area for 2024. Google, microsoft, AmazonOpenAI and Anthropic are pursuing the technology. AI agents are considered a step beyond chatbots. It can perform multi-step, complex tasks on your behalf and create your own to-do lists so you don’t have to walk the user through the process step by step.
“The agent stuff is real. It’s not hype,” Tully told CNBC. “I don’t think it will necessarily cure cancer. But will it make people more productive and help companies make money? Yes.”
According to the report, code generation is the primary use case for generative AI, with more than half of survey respondents citing it as their primary use case. Support chatbots come next at 31%, followed by enterprise search and discovery, data extraction and transformation, and meeting summaries.
