Natural Language Processing Market to Generate Revenue Worth $22.9 Billion by 2024
- Published: December 2019
The global natural language processing (NLP) market generated revenue of $8.3 billion in 2018 and is expected to reach $22.9 billion by 2024, exhibiting a CAGR of 19.7% during the forecast period (2019–2024). The BFSI industry held the largest market share in 2018. With the existence of unstructured data in huge volumes, financial service providers are adopting NLP solutions to analyze data, make effective decisions, and provide quality products and services to their customers. However, the market is projected to witness the fastest growth in the healthcare industry during the forecast period. This can be mainly attributed to the increasing volume of clinical data, rising need for improving patient outcomes, and growing demand for high-quality healthcare—factors that are encouraging the adoption of NLP solutions in the healthcare industry. NLP in healthcare helps integrate electronic health records (EHR) on a patient portal, which further facilitates better understanding of patients’ health conditions and improved decision-making on the part of physicians.
Rising adoption of conversational bots is a key market trend
Increasing adoption of chatbots in organizations is a key trend observed in the natural language processing market. Businesses are increasingly focusing on the deployment of virtual assistants, among which chatbots have gained immense popularity in the last few years. Developers have introduced chatbots that leverage NLP to bridge the gap between customers and businesses, thereby improving customer service. NLP-based chatbots can work on different languages and help organizations streamline their processes, particularly those pertaining to customer care. These chatbots can handle customer queries by being the first point of contact. For instance, Roof.ai is a chatbot that helps real estate marketers to automate interactions with potential clients and lead assignments through social media. The chatbot identifies potential leads through Facebook and responds instantly in a friendly, conversational tone like a real chat agent. It also transfers the potential leads to sales agents, further facilitating increased sales.
Growing shift in businesses toward automation is driving the market
In the competitive business landscape, organizations are shifting their focus from the traditional business model to the automated business model in order to reduce human errors, accelerate business growth, enhance product/service quality, and streamline work processes. In view of this, the NLP technology helps automate data entry and invoicing and several other processes to enhance business performance. For instance, Botkeeper, an AI-based program developed by Botkeeper Inc., is used by several organizations for managing accounts, as it automates accounting by handling tasks within seconds, which otherwise require several hours to complete. Hence, the growing shift of businesses toward automation to enhance work processes is acting as a catalyst in the growth of the global natural language processing market.
Segmentation Analysis of Natural Language Processing Market
- During the forecast period, the natural language processing market is expected to witness the fastest growth in the hybrid NLP category. Increase in data volume in the near future would encourage companies to deploy the hybrid NLP model (a combination of statistical and rule-based models) in their work processes to improve end results.
- In terms of deployment, the public cloud category held the largest share in the market in 2018. With the rise in the number of SMEs, there has been increased demand for highly scalable and cost-effective data analytics solutions. Thus, the demand for public cloud-based NLP solutions has increased, since the cost of deployment of these solutions is low and 24X7 monitoring is provided by cloud service providers.
- Between the two components, solutions held the larger market share in 2018. This can be ascribed to the increased adoption of AI-based solutions in organizations to reduce human intervention.
- Among various applications, machine translation is projected to register the fastest growth in the natural language processing market during the forecast period. Machine translation is one of the key applications of the NLP technology, which translates speech and text inputs from one language into another. The technology also saves a significant amount of time by translating the entire text document within a few seconds.
- The natural language processing market, during the forecast period, is expected to demonstrate the fastest growth in the healthcare industry. This is due to the increasing investments in AI-based technologies in the healthcare industry. NLP in healthcare helps in improving patient care, evaluating treatment cost, and reaching out to patients in remote locations.
Geographical Analysis of Natural Language Processing Market
Globally, North America held the largest share in the natural language processing market in 2018. The market in the region is primarily driven by the surging IT spending and the presence of a large number of multinational companies deploying AI technologies to automate their business processes. In September 2019, the federal government of the U.S. announced its plans of investing $973 million in non-defense AI R&D projects in 2020.
During the forecast period, the natural language processing market is projected to witness the fastest growth in the APAC region. This growth can be attributed to the technological shift in regional industries toward automation, rising number of SMEs, and increasing investments by governments for the innovation and deployment of AI-based technologies. SMEs play a major role in shaping the growth of several economies in the region, including China, India, Japan, and South Korea, and the growing deployment of NLP solutions by these organizations in the region is contributing to the market growth in APAC.
Competitive Landscape of Natural Language Processing Market
The natural language processing market is fragmented in nature, and Alphabet Inc., SAS Institute Inc., International Business Machines (IBM) Corporation, 3M Company, Verint Systems Inc., Apple Inc., Microsoft Corporation, Hewlett Packard Enterprise (HPE) Company, Dolbey Systems Inc., Genpact Ltd., and AWS Inc. are some of the key players in the market. To meet the ever-changing demands from customers through enhanced product offerings, these companies are focusing on mergers and acquisitions in addition to product R&D. For instance, in April 2018, 3M Company partnered with software company C3.ai to use the C3 Platform to develop and deploy AI-based solutions, such as, ML, NLP, and cognitive computing, to serve its customers with more efficiency.
Browse report overview with detailed TOC on "Natural Language Processing (NLP) Market Research Report: By Type (Statistical, Rule-Based, Hybrid), Deployment Type ( Public Cloud, Private Cloud, Hybrid Cloud ), Component ( Solution, services), Application (Information Extraction, Question Answering, Machine Translation, Report Generation, Text Processing), Industry ( BFSI, Automotive, Healthcare, Retail, IT & Telecommunication) – Industry Trends And Growth Forecast to 2024" at:https://www.psmarketresearch.com/market-analysis/natural-language-processing-market
Some other important players in the natural language processing market are NetBase Solutions Inc., SparkCognition Inc., Adobe Systems Inc., Nvidia Corporation, Salesforce.com Inc., and IPsoft Inc.
Natural Language Processing Market Segmentation
Market Segmentation by Type
- Statistical
- Rule-Based
- Hybrid
Market Segmentation by Deployment
- Public Cloud
- Private Cloud
- Hybrid Cloud
Market Segmentation by Component
- Solutions
- Auto coding
- Text analytics
- Speech analytics
- Interactive voice response (IVR)
- Pattern & image recognition
- Optical character recognition
- Services
- Managed
- Professional
Market Segmentation by Application
- Information Extraction
- Question Answering
- Machine Translation
- Report Generation
- Text Processing
Market Segmentation by Industry
- Banking, Financial Services, and Insurance (BFSI)
- Automotive
- Healthcare
- Retail
- IT & Telecommunication
- Others (Including Electronics, public utilities & defense and Media & Entertainment)
Market Segmentation by Region
- North America NLP Market
- By type
- By deployment
- By component
- By application
- By industry
- By country – U.S. and Canada
- Europe NLP Market
- By type
- By deployment
- By component
- By application
- By industry
- By country – U.K., Germany, France, Italy, Spain, and Rest of Europe
- Asia-Pacific (APAC) NLP Market
- By type
- By deployment
- By component
- By application
- By industry
- By country – India, China, Japan, South Korea, and Rest of APAC
- Latin America (LATAM) NLP Market
- By type
- By deployment
- By component
- By application
- By industry
- By country – Brazil, Mexico, and Rest of LATAM
- Middle East and Africa (MEA) NLP Market
- By type
- By deployment
- By component
- By application
- By industry
- By country – U.A.E., Saudi Arabia, South Africa, and Rest of MEA