In the evolving landscape of governance and technology, Gartner has spotlighted four key technologies poised to shape government AI adoption in the coming decade: sovereign AI, AI agents, prompt engineering, and machine customers. According to the 2025 Gartner Hype Cycle for Government Services, revealed by the research and advisory firm, both sovereign AI and AI agents are currently basking in the “Peak of Inflated Expectations.” This reflects a burgeoning interest among governments, although it also underscores the need for careful strategic planning and investment.
Understanding the Hype Cycle
The Gartner Hype Cycle is a valuable tool for tracking the maturity and adoption of emerging technologies. It provides insight into how various technologies might evolve, helping public sector organizations understand how to effectively deploy innovations to meet broader policy objectives. In a time of increasing complexity and rapid technological advancement, the Hype Cycle serves as a roadmap for governments navigating both opportunities and challenges.
Dean Lacheca, Vice President Analyst at Gartner, highlights the urgency of these developments. He notes,
“Public sector leaders face mounting pressure to meet rising citizen expectations, navigate geopolitical uncertainty, and do more with fewer resources. AI agents can address these challenges, but success will depend on bridging the gap between innovation ambitions and broader government priorities to ensure investments strengthen services, trust, and resilience.”
Sovereign AI: A New National Imperative
At its core, sovereign AI refers to initiatives where nations develop and utilize AI technology aligned with specific national objectives. This encompasses everything from automating government operations to modernizing processes and enhancing citizen engagement. Gartner forecasts that by 2028, 65% of governments worldwide will establish requirements for technological sovereignty, aiming to bolster independence and protect against external regulatory influences. This balance is crucial as governments aim not just to adopt AI, but to do so while minimizing associated risks.
AI Agents: The New Workforce
AI agents are autonomous or semi-autonomous software entities capable of perceiving their environments, making decisions, and taking actions to achieve specific goals. These agents can dramatically transform service delivery across government agencies, enhancing tasks such as policy assessment, legal interpretation, and routine process automation. Gartner estimates that by 2029, 60% of government agencies will deploy AI agents to automate over half of their citizen-facing transactions—a significant leap from less than 10% in 2025.
Further elucidating on the effective integration of AI agents, Dean Lacheca advises that government leaders must first identify where these technologies can offer the most value and subsequently run targeted pilot programs. He states,
“This should be followed by a clear roadmap to ensure initiatives progress beyond the pilot phase.”
Prompt Engineering: Crafting Quality Outputs
Prompt engineering is the practice of creating precise inputs for generative AI models, which is essential for eliciting relevant and reliable outputs. Well-crafted prompts tie directly to the quality of results produced by AI systems. For public sector organizations, investing in AI literacy through staff training in prompt engineering can significantly enhance the returns on AI adoption. Establishing libraries of reusable, effective prompts can also streamline processes across various departments.
Dean Lacheca emphasizes the importance of strong prompt engineering capabilities, suggesting that,
“Governments shouldn’t invest in AI solutions if they’re not willing to invest in developing these skills within their organizations.”
Machine Customers: The Future of B2B Interaction
The concept of machine customers refers to autonomous devices or applications capable of purchasing goods and services on behalf of humans or organizations. Currently, there are approximately three billion B2B internet-connected machines acting as customers, a figure that Gartner predicts will grow to eight billion by 2030. The rise of machine customers may compel governments to create new authentication mechanisms, adapt service provision, and revise regulatory frameworks. For example, machine-to-government communications could facilitate the direct administration of road use taxes.
Dean Lacheca warns of the potential regulatory challenges ahead, stating,
“Government leaders need to identify where the adoption of machine customers will necessitate rethinking regulatory enforcement and service delivery.”
He notes that existing service delivery models will undoubtedly be disrupted, raising ethical, legal, and accountability issues that governments must prepare for.
These insights stem from Gartner’s recent Hype Cycle report, designed to inform government and public sector organizations as they navigate the complex terrain of AI and related technologies. As these innovations continue to develop, the implications for governance, service delivery, and public trust will be profound.