India Emerges as an AI Powerhouse with Local Focus, 61% of Americans Adopt Tools
Global AI User Base Nears Two Billion, Says Menlo Ventures Report
Tech News, 29 November 2025: A new report by venture capital firm Menlo Ventures, titled “The State of Consumer AI 2025,” reveals that Artificial Intelligence has moved firmly into the mainstream of daily life, with global user numbers nearing two billion, yet a massive monetization gap persists.
Global Adoption Surges, Spending Lags
The report, based on a nationally representative survey of over 5,000 U.S. adults, found that 61% of Americans have used an AI tool in the last six months, with nearly one in five (19%) using it every day. Extrapolating this trend, Menlo Ventures estimates that between 1.7 and 1.8 billion people worldwide are now using AI, and up to 600 million use it daily.
Despite this widespread use, consumer spending on AI remains low, estimated at only $12 billion. Crucially, just 3% of users pay for AI services, highlighting a significant, untapped revenue opportunity.
“The fact that more than half of Americans already use AI is remarkable, especially considering most are just using it for quick, simple tasks,” said a Menlo Ventures partner. “The biggest opportunity lies ahead when AI handles complex jobs from start to finish.”
The Next Frontier: Specialized and High-Trust AI
Analysts point out that consumers mainly use general AI for routine tasks, but the future of value creation lies in specialized AI. High-friction, high-trust areas like personal finance and mental health currently show low AI adoption, creating “white space” for startups to build purpose-built solutions that general tools cannot adequately address.
Convenience Drives Satisfaction, But Trust Remains a Hurdle
The report highlights several key trends driving—and hindering—adoption:
- Focus on Routine Tasks: AI is quickly becoming a daily habit for many, primarily used for quick and simple tasks. However, the real future lies in AI handling complex, start-to-finish jobs such as planning family activities or managing logistics.
- Specialized Tools Emerge: Consumers mainly use general AI tools for a wide range of tasks; however, specialized AI tools that focus on specific needs such as creative work, health, or finances are starting to gain traction and command spending.
- The Trust Factor: Despite widespread use, many people remain cautious about privacy, trust, and prefer human interaction in certain domains, particularly high-trust areas like health and personal finance.
- Real-World Assistance & Satisfaction: In practical daily life, AI tools assist with routine tasks, health monitoring, learning, social connection, and creative expression. Examples range from AI-powered chatbots and virtual assistants offering shopping advice, recipe suggestions, and travel planning, to AI-enabled productivity boosts like email summarization and meeting notes. The convenience and increased productivity have contributed to growing user satisfaction, reaching up to 78% among users.
India Emerges as an AI Powerhouse with Local Focus
India is quickly becoming a critical hub for conversational AI adoption, driven by a young population, affordable smartphones, and high-speed mobile networks.
- High Engagement: AI chatbot and virtual assistant adoption is estimated at 40-50% among urban and younger users.
- Multilingual Innovation: Indigenous models like Kyvex and BharatGPT are launching, offering locally relevant features and support for multiple Indian languages, significantly boosting digital inclusion.
- Enterprise Use: Sectors like banking, e-commerce, and insurance are rapidly deploying AI chatbots that offer 24/7 support in regional languages, improving accessibility for millions of non-English speakers.
Outlook: The report underscores AI’s increasing role in simplifying daily life globally. The transition from simple, free-to-use tools to complex, paid, and specialized services—especially in high-trust categories—will define the next wave of growth and monetization. India’s commitment to developing native, multilingual AI positions it well to lead the charge in making AI an essential tool for everyday living.
