5 Rising Technology ETFs In 2019

The concept of artificial intelligence (AI) is likely to accelerate in the years to come. Global spending on AI is forecast to reach near $60 billion by 2021, attaining a compounded annual growth rate of about 50% from 2016-2021.

A few examples of AI and machine learning application include: suggesting movies for users—Netflix (NFLX - Free Report) , recommend products for customers—Amazon (AMZN - Free Report) , suggesting events for members— Facebook (FB - Free Report) , self driving cars—Waymo and smart speaker and voice assistant—Google Home/ Amazon Echo. 

In 2019, flexible consumption models would continue to be a tailwind for AI and cloud computing adoption. As a part of their digital transformation initiatives, about 60% of the enterprises are expected to shift their IT systems to cloud.

Cloud Computing

Per research firm Gartner, organizations are moving toward cloud services rather than having their own server infrastructure and are renting software packages. Adoption of cloud services requires lower investments from companies.  As a result, Gartner expects global  IT spending to reach $3.8 trillion in 2019, an increase of 3.2% from the expected spending of $3.7 trillion in 2018.

Growing demand for cloud services point toward an exponential expansion of its value proposition: Everything-as-a-service (XaaS). Xaas is a cloud computing term used to describe an extensive variety of services and applications that can be accessed over the Internet on user demand as opposed to being utilized via on-premises means. The most common and successfully known example is software as a service (Saas).

Saas

SaaS is the primary driver for growth in all the software segments particularly in the Customer Relationship Management (CRM - Free Report) arena where the focus is on providing quality customer experiences. Cloud software is forecast to grow at 22% in 2019 in comparison to 6% growth for all the other forms of software.

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