Analyzing the large amounts of data created by internet-connected devices will be a huge market in the coming decades, according to a top Wall Street firm.
Bank of America Merrill Lynch says the artificial intelligence and so-called big data analysis trends will also have dramatic ramifications for business and markets.
"We are living in an exponential age where ubiquitous connectivity and decreasing cost are leading to the digitization and datafication of most activities," equity strategist Beijia Ma wrote in a note to clients Tuesday.
Big data, which refers to computers analyzing large amounts of information for patterns and associations, and artificial intelligence are as critical to this trend as the internet and smartphones, she added, and "set to propel the 5th wave of IT-driven productivity growth."
Ma estimates the big data market is set to reach $210 billion by 2020, and "AI will be the single largest driver of tech spend over the next decade."
Some 90 percent of the world's data was created in the last two years, Ma said. This will only accelerate, and she predicts internet-connected devices will double in number every two to three years, rising to 1 trillion by 2035.
The strategist said the "untapped potential is huge" for big data and AI computing as only 0.5 percent to 1 percent of data generated so far has been analyzed.
To take advantage of the trend, here are seven buy-rated companies that Bank of America Merrill Lynch recommended.