What is AI as a service (AIaaS)? A beginner’s guide for 2024

The Jetsons nailed artificial intelligence.

Premiering in 1962, the cartoon accurately depicts many technologies we use today—including AI. The show illustrates the benefits and challenges of intelligent automation and how people can implement AI at home and in the workplace. From voice assistants to AI-powered supercomputers, The Jetsons was ahead of its time.

Today, most businesses can access advanced AI technology and be as efficient as Spacely Space Sprockets, the AI-powered factory in The Jetsons, by using AI as a service (AIaaS). If you’re new to this, no worries. Our guide describes the types of AIaaS, benefits, challenges, examples, and trends so you can seamlessly move into the future.

More in this guide:

• Types of AI as a service
• Benefits and challenges of AIaaS
• Popular AI as a service vendors
• AIaaS trends for 2024 and beyond

Types of AI as a service

Businesses can leverage different types of AI services depending on operational needs. Like software as a service (SaaS) business models, companies can subscribe to AIaaS plans that provide AI for customer service tools. Here are some popular types of AIaaS and use cases.

Bots and virtual assistants

Bots and virtual assistants are types of conversational AI that use deep learning, machine learning algorithms, and natural language processing (NLP) to learn from human interactions. They improve with each interaction, delivering a more natural, personalized experience over time.

Businesses often use AIaaS solutions to deploy AI chatbots for convenient customer self-service, like troubleshooting common issues or surfacing answers to FAQs.

Adding customer service chatbots to your website, live chat and messaging platforms, mobile apps, and social media accounts allows you to meet customers where they are on their preferred channels. Additionally, service desk chatbots can provide IT support to internal teams.

Examples of bots and virtual assistants: Siri, Alexa, and Google Assistant

Machine learning frameworks

Machine learning (ML) frameworks are cloud-based software libraries and tools that allow developers to build custom AI models. AIaaS providers offer pre-built ML frameworks that enable businesses to easily train and deploy these AI models without the heavy spend of in-house dev resources.

Examples of ML frameworks: Google Cloud AI and Microsoft Azure Machine Learning

Application programming interfaces

Application programming interfaces (APIs) allow different software apps and systems to communicate, interact, and share information. AIaaS vendors provide APIs so businesses can seamlessly connect the systems they currently use with AI-powered tools, without building the AI models themselves. For example, businesses can integrate bots and voice assistants with their own live chat software or website without code.

Examples of application programming interfaces: IBM Watson Natural Language Understanding API and Amazon Rekognition API

Artificial Intelligence of Things

Internet of Things (IoT) is a network of devices connected to the Internet that share data with each other. The devices contain sensors that exchange information in real time. Artificial Intelligence of Things (AIoT) embeds AI technology and machine learning capabilities into IoT, analyzing data to identify patterns, gather operational insights, and detect and fix problems.

AIoT devices can send relevant information to the cloud (with user permission) to assist with a product’s performance. AIaaS providers may offer forecasting services that enable IoT devices to predict when a machine and equipment may need maintenance, helping businesses avoid expensive interruptions.

Examples of AI for IoT: Google Cloud IoT Core and Microsoft Azure IoT

Benefits and challenges of AIaaS

Like any service, AIaaS comes with its share of pros and cons. Let’s start with a few common benefits of AIaaS to consider.

• Boost team productivity and efficiency: AIaaS allows you to leverage AI-powered features, such as intelligent routing and triage, generative AI, and sentiment analysis. These tools help streamline workflows and improve your team’s skills, resulting in increased productivity without additional headcount.

• Enhance the customer experience: According to the Zendesk Customer Experience Trends Report 2023, most businesses are using AI to answer general questions, make recommendations to customers, improve agent productivity, and provide customers with 24/7 support. With AIaaS, businesses can implement AI faster to deliver personalized, conversational support and level up their CX.

• Reduce costs: Two-thirds of business leaders believe AI and bots will drive major cost savings now and in the future, according to our CX Trends Report. AIaaS is a cost-effective way for businesses to use plug-and-play AI functionality to keep up with evolving business trends and customer expectations—without heavy IT spending.

• Scale faster: Small businesses and startups may need more money and resources than established companies to implement in-house AI. AIaaS levels the playing field, allowing businesses of all sizes to deploy AI. The right AIaaS provider grows with your company, allowing you to adapt the AI capabilities to your needs and increase scalability.

Feeling uncomfortable with new technology, especially AI, is completely normal. Though AIaaS offers rich benefits, these challenges may be something to consider when picking the right AIaaS solution for your business.

• Risk of biased or unreliable data: If somebody trains an AI model on unreliable, biased, or unethical data, it could result in inaccurate results and decision-making. AIaaS providers should offer tools and services that help businesses ensure datasets are reliable, ethical, and unbiased.

• Concern about data privacy and security: AI-powered software needs access to large amounts of data (known as big data) to learn and personalize the customer experience (CX). Your AIaaS vendor will have access to this sensitive and personal information. So, the vendor you choose must have advanced data privacy and protection software to minimize the risk of exposing information during a security breach.

• Compliance with regulatory standards: Regulations governing the use of AI may vary across industries or locations. That means it’s important to make sure the AIaaS vendor you choose meets compliance standards relevant to your business. It’s also essential for the vendor to be transparent and proactive in sharing any compliance changes.

Popular AI as a service vendors

Choosing the right AIaaS vendor can help you successfully implement the AI tools that fit your business needs. Here are a few of the top AI as a service providers and examples of what they offer.

Amazon Web Services

Amazon isn’t just an e-commerce marketplace with fast delivery. It’s also a cloud computing provider offering AI and machine learning services. Its AIaaS, Amazon Web Services (AWS), offers tools for businesses to build, train, and deploy AI models. AWS AIaaS offerings include:

• Amazon SageMaker: This service makes it easy for dev and data teams to build, train, and deploy machine learning models.
• Amazon Rekognition: This computer vision service provides capabilities for image and video analysis, including object detection and facial recognition.
• Amazon Lex: This offers natural language processing capabilities for building chatbots and conversational interfaces.
• Amazon Polly: This text-to-speech service converts text into life-like speech useful for voice-enabled applications.

Google Cloud

Of course, Google would make an appearance on this list. Google Cloud offers a suite of AI solutions and ML services that extend from NLP to computer vision. Here are a few cloud services offered in its toolset:

• Google Cloud AI is a set of machine learning tools and AI services for data scientists and dev teams that includes support for TensorFlow (the open-source ML framework that powers most Google products) and scikit-learn (a data analysis and algorithm library).
• Google Cloud Natural Language API is a natural language processing tool for sentiment analysis and content classification.
• Google Cloud Vision AI is a computer vision service for image and video analysis, featuring object detection and labeling as well as facial recognition.
• Google Dialogflow is an advanced AI platform for building conversational interfaces that use ML models, such as chatbots and virtual assistants.

OpenAI

You’ve likely heard of OpenAI’s generative AI tools ChatGPT and Dall-E, but its AIaaS offers so much more. OpenAI’s cloud-based AI services and models help developers, too. Some examples include:

• GPT-3: This is a language model that uses natural language processes and generative AI. It is available through an API, allowing developers to build custom AI applications.
• OpenAI Codex: An AI model designed for code generation, it assists developers in writing code more efficiently.
• OpenAI DALL-E: This creates unique visual content from text inputs.

These three cloud platforms are just the tip of the iceberg in the AIaaS landscape. While Amazon, Google, and OpenAI are the most popular companies providing AIaaS services for a wide range of use cases, other AIaaS vendors may have offerings that better fit your business needs.

AIaaS trends for 2024 and beyond

As we continue finding new ways to use AI in customer service, businesses must implement AI to keep up with the competition. Here are a few AIaaS trends to keep an eye on now and in the future.

Natural, human-like conversational experiences

It’s no wonder that 65 percent of business leaders believe that AI and bots are becoming more natural and human-like—because they are. AI-powered bots use data from the customer’s knowledge base to generate accurate, conversational replies. You can even create a unique chatbot persona to match the voice and tone of your brand to enhance the customer experience.

Consumers are already familiar with Alexa, Siri, and Google Assistant and have embraced the convenience of conversational AI. And because bots learn from each interaction, conversations with AI will only get better.

Deeper personalization

Consumers now expect immersive experiences when interacting with brands. They understand that businesses collect data and, per our CX Trends Report, 59 percent want them to use it to personalize their experiences. AIaaS can provide pre-trained bots that use NLP to understand user intent and customize responses based on previous interactions.

Better collaboration and reduced data silos

Traditional support roles are evolving and responsibilities are being redefined. According to our CX Trends Report, 72 percent of business leaders believe that merging teams and responsibilities increases operational efficiency, meaning cross-functional collaboration and sharing data is a must. AIaaS provides technology that makes it easy to consolidate fragmented data in one place, break down data silos, and collaborate more efficiently.

Rise of the machines

AI made the jump from sci-fi cartoons to real life and has quickly become a crucial part of enhancing both customer and employee experiences. Businesses and customers alike have embraced the technology and understand that the benefits of AIaaS are essential to stay innovative and competitive. Using AIaaS, you can implement user-friendly AI-powered tools to optimize your systems, meet business needs, and crush your competition.