AI Adoption Surges in APAC as Australian and New Zealand Companies Confront Skills Shortages
Organisations in Australia and New Zealand are experiencing early business gains from Artificial Intelligence (AI), yet they face significant challenges, particularly in addressing skills gaps across various sectors. According to new research commissioned by Dell Technologies and NVIDIA, the IDC analysis reveals a rapid acceleration of AI, Generative AI (GenAI), and Machine Learning (ML) adoption across the Asia Pacific (APAC) region. The AI-centric server market in APAC is projected to reach AUD$366 billion by 2025, with 21% of organisations in Australia and New Zealand (ANZ) reporting measurable improvements from AI and ML deployments. Additionally, 5% of ANZ businesses consider AI central to their competitiveness. Spending on GenAI is also on the rise, with 84% of APAC organisations expected to allocate between AUD$1.5 to $3 million for GenAI initiatives this year. Notably, 38% of AI budgets in APAC are dedicated to GenAI, surpassing the global average of 33%. Despite this optimism, businesses encounter challenges in aligning AI initiatives with strategic goals and integrating AI into existing workflows.
Deployment strategies for AI are evolving, with public cloud solutions, including multicloud, leading the way in 2024. However, there is a growing demand for private and on-premises AI deployments, driven by concerns over security, cost efficiency, data sharing, collaboration, and industry-specific needs. Organisations are increasingly adopting specialised AI models while focusing on data security and infrastructure choices across cloud environments. Key challenges for scaling AI and GenAI include rising IT costs, regulatory and compliance risks, and the need to meet energy efficiency commitments. Skills shortages are a significant concern for over 72% of APAC enterprises, causing delays in digital transformation and product development. Security and privacy remain critical considerations, prompting organisations to seek external service providers for support in AI system security, infrastructure modernisation, and workforce training. The report indicates that APAC organisations are generally adopting a structured, phased approach to AI, targeting high-impact use cases to deliver measurable benefits while mitigating risks. Australian and New Zealand businesses are increasingly relying on external experts to address skills shortages and build scalable infrastructure. In APAC, 60% of businesses depend on external developers for AI applications, while 30% develop AI in-house and 10% utilise commercial off-the-shelf solutions. Partnerships with technology providers have become essential for roadmap development, infrastructure support, implementation, and workforce development.
Categories: AI Adoption Trends, Deployment Strategies, Skills and Infrastructure Challenges
Tags: AI, Generative AI, Machine Learning, Skills Gaps, Cloud Deployment, Data Security, Digital Transformation, Infrastructure, Compliance Risks, External Partnerships