Australia Artificial Intelligence Market Analysis, Size, and Forecast by Type, Deployment Model, Industry, and Organization Size: 2019-2033

Australia Artificial Intelligence Market Outlook

Australia artificial intelligence (AI) market is rapidly evolving, poised to surpass USD 18 billion in value by 2033. This surge is powered by accelerated digital transformation across sectors like telecommunications, healthcare, fintech, and government services. According to David Gomes, Manager – IT, much of this momentum stems from Australia's newfound strategic intent to build sovereign AI capabilities and reduce its reliance on foreign tech ecosystems—a position emphasized by recent policy shifts under the "Future Made in Australia" initiative. Despite early political inertia, recent budget revisions and the launch of the National AI Capability Plan signal a tangible pivot toward long-term investment in AI governance, safety, and innovation. If implemented effectively, this plan could contribute an estimated $600 billion annually to Australia’s GDP by 2030.

AI is already transforming core industries. Telstra has implemented AI-driven customer support tools, enhancing response times and customer satisfaction through intelligent routing and automated query resolution. In healthcare, AI’s utility ranges from triaging critical patients to accelerating brain scan interpretations—technologies that are not only improving patient outcomes but also addressing workforce shortages. The SBS News podcast underscores this transformation by highlighting AI-powered diagnostic tools and virtual companions like Abi the robot, which are revolutionizing aged care and combating loneliness. Fintech players such as Mastercard are also leveraging AI to secure digital transactions, with initiatives to phase out card numbers entirely in favor of tokenization and behavioral biometrics.

However, as highlighted in The Sydney Morning Herald and Forbes Australia, the nation’s AI progress isn’t without concern. Australia still grapples with an AI policy vacuum, especially when compared to comprehensive regulatory frameworks like the EU AI Act. Claude 3.7 Sonnet, an advanced AI model, is already displacing traditional roles in software engineering, law, and customer service. Without a proactive approach to workforce retraining, Australia risks widespread job displacement. Furthermore, the environmental footprint of AI remains a critical challenge. As per insights from Goldman Sachs and the International Energy Agency, AI-based data centers in Australia consume as much energy as 100,000 households, raising alarms over sustainability. The rising volume of e-waste and water usage necessitates immediate regulatory and infrastructure upgrades focused on energy-efficient computing.

On the startup front, Australia is witnessing a vibrant AI ecosystem. Companies like Harvey.ai and SpatialGPT are leading innovation across legal tech and immersive AR/VR experiences. Harvey.ai, for instance, is disrupting traditional legal workflows by automating contract reviews and compliance tasks, reducing overheads for SMEs. SpatialGPT recently secured $5.1 million in funding to push the boundaries of spatial computing with AI, a testament to investor confidence in Australian AI innovation. Yet, capital accessibility, global competition, and the lack of a unified national AI framework threaten to derail this momentum. This is where federal and state governments must prioritize funding, provide infrastructure support, and streamline regulatory compliance for startups navigating this complex landscape.

The political landscape is finally waking up to AI’s significance. Ministers like Tim Ayres and Andrew Charlton have stepped forward to anchor Australia’s AI sovereignty, tasking the Department of Industry, Science, and Resources with ensuring domestic capability. The slow but visible transition from campaign silence to active governance has encouraged both public and private entities to invest in AI as a critical pillar of economic resilience. Nevertheless, expert commentators continue to call for a more aggressive, forward-facing strategy—particularly around ethical use, open data frameworks, and AI safety standards.

Looking ahead, Australia's global AI competitiveness hinges on how swiftly it can resolve talent shortages, strengthen cybersecurity protocols, and deploy green AI infrastructure. The strategic alignment of government policy with private sector innovation will be crucial. As emphasized in the ABC News segment, competing on a global stage with the U.S. and France requires more than just technological adoption—it demands vision, governance, and execution. As Australia confronts the AI revolution, the opportunity is monumental, but so is the responsibility.

Authors: David Gomes (Manager – IT)

*Research Methodology: This report is based on DataCube’s proprietary 3-stage forecasting model, combining primary research, secondary data triangulation, and expert validation. [Learn more]

Australia Artificial Intelligence Market Scope