Why Enterprises Prefer Proprietary AI

(Editor's note: This is a Cloud Tracker Pro article that will be provided for free for a limited time.)

Enterprises investing in AI are using a variety of tools to generate AI applications, and Futuriom research shows a startling preference for proprietary technology.

Futuriom's Cloud Tracker Pro services is now building a private database—the Enterprise AI Index—which includles more than 100 case studies of enterprises building AI capabilities and Services. The four top vertical markets using AI show a preference for building proprietary, or private, AI platforms, even though several large enterprises are deploying external, or vandor-specific, models on those homegrown platforms, as shown in the charts below:

It may seem puzzling that financial services firms top the list of AI adopters, given some experts' views that the strict rules governing financial services might discourage use of AI, which still poses risks in terms of reliability. Proprietary platforms address these issues by giving firms a means of centralized control and guardrailing for AI apps.

Proprietary AI Platforms Run Variety of Models

An example of the trend toward proprietary AI platforms in finance is Bloomberg. The company created its own AI model, BloombergGPT, and has generated a proprietary platform around it for regulatory compliance and security. The model has added significant features to Bloomberg’s Terminal service, including natural language search, news and earnings report summarization, chat assistants for navigation, and risk and trend analysis. These capabilities are further supported by a BloombergGPT API available to external developers.

Another example: Goldman Sachs. The financial services firm created its own GS AI Platform to ensure centralized control over all its AI applications. The platform serves as a base for development using a variety of vendor-specific or external models, including OpenAI’s ChatGPT 3.5 and GPT-4, Google’s Gemini, Meta’s Llama, and models from Anthropic, Cohere, and Mistral. Having a proprietary platform gives developers a single starting point and context for creating applications and allows them to shift between models securely and in compliance with regulations.

Why Proprietary Is Preferred

Taken all together, the four top vertical markets for enterprise AI—financial services/insurance, healthcare, retail, and manufacturing—prefer proprietary AI platforms as a group, though other platforms are popular as well, most notably ChatGPT and other OpenAI models.

There are several reasons for this, but as noted above, security and compliance top the list. Companies in healthcare in particular opt for proprietary AI platforms and models to ensure alignment with stringent rules governing confidentiality and patient information in the sector.

The Mayo Clinic, for instance, built its own AI platform and created models from its wealth of clinical data. Its proprietary AI approach ensures security and full compliance with data privacy laws, including HIPAA. In this context, the clinic has been able to create a range of applications for improving patient outcomes. A deep learning model, trained on 600,000 electrocardiograms (ECGs), detects asymptomatic left ventricular dysfunction, which often doesn’t show up on standard ECGs.

Other reasons for proprietary AI platforms are convenience and scalability: It's easier and faster to develop applications on a centralized platform.

In the retail sector, Walmart, which has used Microsoft Azure’s AI platform, has not only fitted that platform with strict controls but also has developed its own AI models based on sensitive data such as customer interactions and purchase histories, supply chain details, and pricing specifics. Walmart has tailored its models to track and provide information on 10,500 stores in 19 countries, patronized by more than 240 million customers per week. Clearly, scaling applications has been a benefit of Walmart's centralized platform.

The above examples are just some of the data we’ve gathered in our Enterprise AI Index, which we continue to update daily. Access to the index will be available shortly for Cloud Tracker Pro subscribers. We’ll keep you posted!