Generative AI in Animation Market Size, Share & Trend Analysis Report By Type, By Component, By End Use, By Region, And Segment Forecasts, 2024 - 2030

Market Size & Trends

The global generative AI in animation market size was estimated at USD 1,315.8 million in 2023 and is projected to grow at a CAGR of 40.3% from 2024 to 2030. The scalability and quality improvements offered by generative AI in animation are transformative factors propelling its market growth. By efficiently handling large workloads, from creating numerous characters to intricate scenes, AI-powered tools enable both small and large studios to meet production demands effectively. Moreover, the continuous refinement and sophistication of generative AI algorithms result in animations of exceptional quality, often comparable to those crafted by human animators. This combination of scalability and quality enhancement optimizes production processes and also elevates the standard of animated content, driving widespread adoption and market expansion within the animation industry.

The growing demand for high-quality animated content, fueled by the rise of streaming platforms and online content consumption, is a key driver propelling the adoption of generative AI in the animation market. As audiences seek fresh and engaging content, studios face pressure to produce at scale without compromising quality. Generative AI offers a solution by simplifying animation processes, enabling animators to create captivating content more efficiently. This efficiency is crucial in meeting the increasing demand for diverse and innovative animations across various platforms. Moreover, AI-powered tools empower creators to experiment with new styles and techniques, enriching the content with a wider array of offerings. Adobe Systems Incorporated, Autodesk, Inc., and NVIDIA Corporation are among the frontrunners in this pursuit. As AI progresses, it promises to transform animation, ushering in an era defined by unparalleled creativity and productivity.

NLP enables animators to provide textual descriptions or commands to AI systems, guiding them in generating animations directly from natural language inputs. This simplifies the animation process, enabling quicker iteration and exploration of ideas, which enhances efficiency and productivity. NLP enables AI systems to understand better and interpret human intentions and preferences, leading to more personalized and engaging animated content. This personalized approach is particularly beneficial in industries such as gaming, advertising, and virtual reality, where user engagement is crucial.  NLP enhances the capabilities of Generative AI in animation, offering increasingly intuitive and efficient animation solutions. This promotes creativity and innovation, as animators can experiment with new styles and concepts that were previously not feasible or too resource-intensive. NLP facilitates seamless communication between animators and AI systems, enabling more effective collaboration and feedback. This leads to a more dynamic and iterative animation process, where creatives can refine their ideas and adapt to changing requirements.

Market Concentration & Characteristics

The degree of innovation in the generative AI in animation market is substantial, marked by continuous advancements that redefine the boundaries of creativity and efficiency in animation production. With the convergence of sophisticated algorithms, deep learning techniques, and access to vast datasets, AI-driven tools are transforming the animation landscape. From automating repetitive tasks to enabling novel forms of expression, Generative AI is empowering animators to push the limits of imagination and storytelling. Moreover, the integration of natural language processing (NLP) and other advanced technologies further enhances the capabilities of generative AI, facilitating seamless interaction and collaboration between human creators and AI systems.

The level of merger and acquisition activities in the Generative AI in animation market is significant, driven by the growing demand for high-quality animated content and the need for studios to stay competitive. For instance, in May 2024, NVIDIA Corporation collaborated with ServiceNow, a U.S.-based software company, to introduce digital customer service avatars powered by GenAI, offering more engaging and personalized interactions through speech recognition, facial animation, and AI technologies. The solution aims to enhance user experiences across sectors such as HR, finance, IT, retail, and travel, reflecting the ongoing evolution of AI in everyday interactions.

Regulations in the animation market, particularly concerning generative AI, aim to address issues such as content accuracy, intellectual property protection, privacy concerns, ethical considerations, safety, and consumer protection. These regulations ensure that AI-generated animations adhere to standards for decency and authenticity, respect intellectual property rights, safeguard user privacy, follow ethical guidelines, mitigate potential risks, and provide transparent information to consumers. They also promote responsible development and use of AI technologies and protect societal values and individual rights.

The impact of substitutes on the generative AI in animation market can be both challenging and stimulating. While traditional animation methods may serve as substitutes, generative AI offers unique advantages such as efficiency, scalability, and creativity. However, these advantages also attract competitors developing alternative AI-driven solutions. The presence of substitutes encourages ongoing innovation and differentiation within the generative AI sector, pushing companies to improve their technology and offer distinctive features to stay ahead.

The end user concentration in the generative AI animation market is significant, with key players actively involved in the development and adoption of generative AI technologies for animation production. The market is driven by the growing demand for high-quality animated content and the need for cost-effective production solutions, with the accessibility of advanced AI tools also contributing to its growth. The market is driven by continuous technological advancements, growing awareness of AI benefits, and integration with other technologies like the Internet of Things and cloud computing.

Type Insights

The Transformers segment led the market and accounted for 41.2%of the global revenue in 2023. The transformer segment is experiencing growth in the generative AI animation market due to its ability to handle complex sequential data and capture long-range dependencies, which is essential for generating realistic and coherent animations. Transformers, with their self-attention mechanism, excel in understanding contextual relationships within input sequences, allowing them to produce high-quality animation outputs. This capability makes transformers particularly suited for tasks such as scene generation, character animation, and motion prediction, where context and continuity are crucial. Moreover, the versatility of transformers enables them to adapt to various animation styles and genres and serve the diverse needs of animation studios and content creators.

The GANs segment is projected to grow significantly over the forecast period. GANs are poised for growth in the generative AI animation market due to their ability to generate diverse and realistic animation content by learning from large datasets. Their adversarial training framework enables them to produce visually appealing animations with enhanced creativity and variation. GANs excel in tasks such as character design, scene generation, and animation interpolation, offering valuable tools for animation studios and content creators. Moreover, GANs' capability to generate novel content and preserve the style and aesthetics of input data makes them highly valuable for creating engaging and immersive animation experiences. As the demand for high-quality and customizable animation content increases, GANs are expected to drive innovation and advancement in generative AI animation technology.

End Use Insights

The gaming segment accounted for the largest market revenue share in 2023. Gaming companies are increasingly incorporating advanced animation techniques to enhance the realism and immersion of their games, driving demand for generative AI solutions. These solutions enable gaming developers to create lifelike characters, dynamic environments, and fluid animations, elevating the gaming experience for players. Moreover, generative AI offers efficiencies in content creation, enabling gaming studios to produce high-quality animations at scale and reduce production costs. Moreover, as the gaming industry expands and diversifies, there is a growing need for innovative and visually compelling content to capture the attention of players, further fueling the adoption of generative AI in animation. Furthermore, advancements in hardware and software technologies have made generative AI more accessible to gaming developers, facilitating its integration into game development pipelines.

The advertising segment is projected to grow significantly over the forecast period. Advertisers are increasingly seeking innovative and engaging ways to capture audience attention in a crowded digital sector. Generative AI in animation offers unique opportunities to create dynamic and personalized advertising content that resonates with viewers, driving higher levels of engagement and brand recall. Moreover, advancements in AI technology have made it easier and more cost-effective for advertisers to produce high-quality animated ads at scale and serve diverse target audiences and platforms. Moreover, as consumer preferences shift towards interactive and immersive content experiences, advertisers are increasingly turning to generative AI to create interactive advertisements and virtual experiences that drive customer engagement and brand loyalty.

Component Insights

The solutions segment accounted for the largest market revenue share in 2023. The solution segment dominates the generative AI animation market due to the comprehensive offerings provided by solution providers, including end-to-end services and support. These solutions typically integrate AI technologies with animation software, offering seamless workflows and simplified production processes. Animation studios and content creators prefer solutions that provide a holistic approach, covering various aspects of the animation production pipeline, from character design to scene generation and rendering. Moreover, solution providers often offer customizable options customized to the specific needs and preferences of their clients, further solidifying their dominance in the market. The expertise and experience of solution providers in implementing generative AI technologies contribute to their dominance, as clients trust their capabilities to deliver high-quality results efficiently.

The services segment is predicted to foresee significant growth in the forecast period. Animation studios and content creators seek services such as consulting, training, and customization to integrate generative AI technologies into their workflows effectively. Moreover, as the complexity of animation projects grows, there is a need for services that provide technical assistance, troubleshooting, and ongoing maintenance to ensure the smooth operation of AI-powered tools. Moreover, services facilitate knowledge transfer and skill development within organizations, empowering teams to harness the full potential of generative AI for animation production. As the market matures and the adoption of generative AI increases, the demand for services is anticipated to grow further, driven by the desire for expertise and support in maximizing the benefits of AI technology in animation.

Regional Insights

North America dominated the market and accounted for 32.6% share in 2023. North America's dominance in the generative AI in animation market is anchored in its extensive network of established animation studios, technology companies, and research institutions. These entities are at the forefront of pioneering and integrating AI technologies. With abundant resources, specialized expertise, and advanced infrastructure, they lead the industry's innovation trajectory. These organizations have the resources, expertise, and infrastructure to drive innovation and lead the market. Moreover, North America has a thriving entertainment industry, including film, television, gaming, and advertising, which are major consumers of animation services and technologies. The presence of these industries creates a strong demand for generative AI in animation, driving market growth in the region.

U.S. Generative AI in Animation Market Trends

The Generative AI in Animation market in the U.S. is expected to grow significantly over the forecast period.The growth of the Generative AI in Animation market in the U.S. is propelled by the expanding adoption of AI technologies across diverse industries. As businesses across sectors recognize the transformative potential of AI, they increasingly seek innovative animation solutions powered by generative AI.

Europe Generative AI in Animation Market Trends

In Europe, the generative AI in Animation market is witnessing substantial growth, propelled by the continent's diverse cultural sector. This diversity creates a demand for customized and culturally relevant animation content. Generative AI technology promote the customization and adaptation of content to serve the specific preferences and needs of European audiences.

The generative AI in animation market in the UK  is experiencing notable growth, fueled by the country's vibrant animation industry. With a long-standing tradition of creative excellence and innovation, the UK provides an ideal environment for embracing advanced technologies such as generative AI.

The Germany generative AI in animation market held the significant share of the Europe market. Germany's robust economy and advanced technological infrastructure facilitate the adoption of advanced technologies such as generative AI, providing a solid foundation for innovation. These factors contribute to Germany's prominence in the integration and utilization of advanced AI technologies across various industries.

Asia Pacific Generative AI in Animation Market Trends

Asia Pacific is anticipated to register the fastest CAGR over the forecast period. The Asia Pacific region is experiencing rapid growth and adoption of generative AI in animation, driven by the increasing demand for high-quality animation content in sectors such as entertainment, gaming, advertising, and education. Emerging markets in the Asia Pacific, such as China, India, South Korea, and Japan, are emerging as key players in the global animation industry. These countries are investing heavily in AI technologies and are utilizing generative AI to produce innovative and engaging animation content.

The China generative AI in animation market is expected to grow significantly over the forecast period. The rise of digital platforms and streaming services in China is creating new opportunities for content creators to utilize generative AI in producing engaging and immersive animation content for a rapidly growing online audience.

The generative AI in animation market in India is expected to grow substantially over the forecast period. India's large and diverse population presents vast opportunities for content creators to leverage generative AI in creating localized and culturally relevant animation content. As digital penetration increases and consumption patterns evolve, there is a growing demand for personalized and engaging animation content customized to Indian audiences.

Middle East & Africa (MEA) Generative AI in Animation Market Trends

The MEA region is undergoing rapid digital transformation fueled by increasing internet penetration, smartphone adoption, and the rise of digital platforms. This digital shift is creating new opportunities for content creators to utilize generative AI in producing innovative and engaging animation content for diverse audiences. MEA region is witnessing the emergence of a dynamic animation industry, driven by growing consumer demand for high-quality content in sectors such as film, television, gaming, and advertising. Generative AI technologies are increasingly being adopted to enhance the quality and efficiency of animation production in the region.

Key Generative AI in Animation Company Insights

Prominent firms have used product launches and developments, followed by expansions, mergers and acquisitions, contracts, agreements, partnerships, and collaborations as their primary business strategy to increase their market share. The companies have used various techniques to enhance market penetration and boost their position in the competitive industry. For instance, in April 2024, WPP plc, a British Communication company, collaborated with Google LLC, utilizing Gemini AI. This collaboration signifies a pivotal moment in marketing innovation, promising enhanced creativity and campaign optimization. By integrating Google's Gen AI capabilities, WPP aims to drive efficiency and effectiveness in marketing strategies, potentially transforming the industry sector.

Recent Developments

• In May 2024, Google LLC introduced AI-powered features to improve search and advertisement capabilities, including testing advertisements within Search Generative Experience and enabling advertisers to create animated ads from still images.  These features enable advertisers to incorporate brand-specific fonts and colors in ads, enhancing the customization options available through Google's Performance Max platform.

• In May 2024, Autodesk acquired Wonder Dynamics, a U.S.-based AI-based video production tools provider, to integrate its cloud-based 3D animation and VFX solution with AI into established tools, aiming to simplify processes and enhance creativity. This acquisition strengthens Autodesk's strategic goal of utilizing AI to connect teams, data, and processes in the Media and entertainment industry.

• In April 2024, Kartoon Studios, Inc. launched an AI toolkit to improve animation quality and workflow efficiency. This generative AI toolkit represents a significant advancement in animation production, harnessing AI technology to optimize workflows and elevate the quality of animated content.

• In August 2023, Autodesk Inc.'s Maya, a 3D modeling and animation software, is set to transform with the integration of generative AI tools, promising dynamic generation of textures, materials, and HDR images directly within the platform. This development aims to transform the efficiency of look development and scene lighting workflows for artists using Maya.

• In May 2023, NVIDIA Corporation released a major Omniverse upgrade that introduces the OpenUSD framework and generative AI, enhancing 3D pipelines and accelerating industrial digitalization with new applications and services. The platform offers modular app building, rendering optimizations utilizing NVIDIA RTX GPUs, and extended-reality developer tools, enabling developers and enterprises to build larger-scale simulations and customize 3D projects.

Generative AI in Animation Market Report Scope

Global Generative AI in Animation Market Report Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global generative AI in animation market report based on type, component, end use, and region.

• Type Outlook (Revenue, USD Million, 2017 - 2030)

  • Transformers

  • GANs

  • VAEs

  • Others

• Component Outlook (Revenue, USD Million, 2017 - 2030)

  • Solutions

  • Services

• End Use Outlook (Revenue, USD Million, 2017 - 2030)

  • Televisions (Over-the-Top)

  • Advertising

  • Movie Production

  • Gaming

  • Others

• Regional Outlook (Revenue, USD Million, 2017 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • UK

    • Germany

    • France

  • Asia Pacific

    • China

    • Japan

    • India

    • South Korea

    • Australia

  • Latin America

    • Brazil

  • Middle East and Africa (MEA)

    • KSA

    • UAE

    • South Africa