AI spending is already at record levels, and it's only going up. Research firm IDC projects that global AI infrastructure investment could hit $1 trillion by 2029, including a fivefold increase in enterprise spending.
This spend is part of the AI supercycle, a central theme at the IDC CIO Summit in New York in May, where IDC tracked two converging forces: on the supply side, when surging infrastructure will be ready for inference at scale, and on the demand side, when enterprises will finally cross the inflection point from experimentation into production.
That moment may not be far off. While most organizations are still in the early stages, IDC projects that by 2029, AI will be in production across most business functions, with nearly one billion AI agents operating worldwide.
Meredith Whalen, Chief Research & Product Officer at IDC, told The Deep View that a key part of ensuring enterprises get their desired ROI is having the infrastructure to bring inference costs down to a level that scales across the organization. At the moment, a capacity shortage is keeping those costs high.
“Right now, it's okay, because we're not seeing the enterprises adopting at scale yet, but as soon as they start to adopt AI at scale, they've got to have the price per inference at a reasonable level, or the business case won't be there,” said Whalen. “So that's why this timing between the build out of capacity and the adoption by enterprises is really important.”
She highlighted the need for enterprises and leaders to focus on building the foundation, since that is ultimately what will allow them to take advantage of bigger, more useful AI agents that are coming to fruition. Otherwise, they risk getting lapped by competitors.
“[Competitors] may have operating advantages in terms of speed. They may be able to redeploy their labor costs into other areas that will help them grow or innovate, and if you haven't done that as a company, then you're going to be behind,” added Whalen.
While the promise of AI agents seems like it's been around for years, Whalen explains that what we’ve had over the past few years has been helpful but not transformative. The next phase with agents is fundamentally different as it will actually reshape workflows and how work gets done. Whalen gave some advice for this next stage:
Meaningful transformation: Rethink business processes and workflows for an agentic future, which Whalen calls one of the biggest blockers for enterprises right now.People: “Organizations who are further ahead have actually spent a significant amount of their effort on change management and addressing the people part.”Embrace it: While it may take a bit longer or have multiple bumps along the road, Whalen reassures people that AI will be a key part of the future, and we're not just in a temporary bubble. As a result, she encourages both employees and leaders to embrace the technology, as working with AI will be an important skill set to develop.
Our Deeper View #
The conversation around AI investment continues to dominate the agenda in most businesses, driven by spending numbers that keep growing exponentially and leaving many wondering whether a bubble is forming and what a burst would mean. The concern is especially acute, given that many enterprises have yet to see clear ROI, particularly from transformative and expensive technologies such as AI agents. That makes understanding the research behind the continued advice to invest even more important. It contextualizes why analysts believe this buildout makes sense and helps justify why capital continues to flow even as the ROI picture is still emerging.