Global Natural Language Processing Market By Type (Statistical NLP, Rule Based NLP, and Hybrid NLP), By Component (Solution and Services), By Deployment (On-Premises and Cloud), By Application (Sentiment Analysis, Data Extraction, Risk And Threat Detection), By Technology (Interactive Voice Response (IVR), Optical Character Recognition (OCR), Text Analytics), By Enterprise Size (Small and Medium-sized Enterprises (SMEs) and Large Enterprises), By Industry Vertical (Healthcare, Retail, High Tech and Telecom, BFSI), By Region and Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends and Forecast 2023-2032
- Published date: April 2024
- Report ID: 16744
- Number of Pages: 369
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Report Overview
The Global Natural Language Processing Market size is expected to be worth around USD 453.3 Billion by 2032, from USD 37.1 Billion in 2023, growing at a CAGR of 33.1% during the forecast period from 2024 to 2033.
Natural Language Processing (NLP) refers to the branch of artificial intelligence that enables computers to understand, interpret, and respond to human language in a way that is both meaningful and useful. This technology encompasses a range of computational techniques that bridge human communication and machine understanding, allowing for the facilitation of tasks such as translation, sentiment analysis, and topic segmentation.
The market for Natural Language Processing is experiencing substantial growth, driven by the increasing demand for enhanced customer experiences, the proliferation of digital data, and advancements in machine learning technologies. The NLP market is segmented across various applications including voice recognition, chatbots, and predictive text, demonstrating its broad impact on industries ranging from healthcare to finance. As businesses continue to adopt NLP solutions to gain insights from unstructured data and improve operational efficiencies, the market is expected to witness continued expansion
Note: Actual Numbers Might Vary In The Final Report
Key Takeaways
- Market Valuation: The Natural Language Processing Market was valued at USD 27.9 Billion in 2022 and is projected to reach a substantial worth of around USD 453.3 Billion by 2032, at a remarkable CAGR of 33.1%.
- By Type Analysis: Statistical NLP held the highest revenue share in 2022 at 39.3%, followed by rule-based and hybrid NLP segments.
- By Component Analysis: Solutions accounted for 72.6% of the revenue in 2022, while the service segment is expected to grow significantly during the forecast period.
- By Deployment Analysis: The on-premise segment is projected to lead deployment, offering full control, visibility, and authentication security controls. Cloud-based NLP deployment, however, is expected to experience the fastest growth during the forecast period.
- By Application Analysis: Automatic summarization dominates the market share, with NLP tools extensively used in risk and threat detection activities, expected to reach 18% market share by 2032.
- By Enterprise Size Analysis: Large enterprises captured the leading revenue share of 62.1% in 2022, with the accessibility of NLP tools in the cloud revolutionizing operations for small and medium-sized enterprises (SMEs) in the forecast period.
- By Industrial Vertical Analysis: The healthcare segment held a significant revenue share of 23.1% in 2022, owing to the adoption of advanced technologies and software, such as predictive analytics, NLP tools, and automation software.
- Drivers: The adoption of cloud-based NLP solutions for efficient data processing, the utilization of AI technology for automated data collection, and the growing digitalization and technological advancements in healthcare are the key drivers propelling market growth.
- Restraints: Data security issues and limited interoperability among companies pose challenges to market growth. Concerns over security flaws in systems like Siri and Watson could hinder market expansion.
- Opportunities: The increasing digitalization and technological advancements in healthcare facilities create a wealth of data, making analytics a key strategy for organizations. NLP technology can extract useful insights from this data, presenting ample opportunities for growth.
- Trends: Market growth is being fueled by the escalating use of digital technology-based software by global enterprises, with increasing investments in NLP software that utilize cutting-edge technologies.
- Regional Analysis: North America is anticipated to maintain the largest revenue share by 2022, driven by AI and machine learning technologies. Asia Pacific is expected to exhibit the highest compound annual growth rate during the forecast period, attributed to growing smartphone usage, rapid technological advances, and government initiatives promoting technological development.
- Key Market Players: Notable companies leading the NLP market include Apple Inc., Meta Inc., Google Inc., Hewlett-Packard Enterprise, IBM Corporation, Intel Corporation, Microsoft Corporation, Narrative Science, SAS Institute Inc., Verint Systems, Inc., and others.
By Type Analysis
In 2022, statistical NLP held the highest revenue share, with 39.3%. Forecasts anticipate substantial growth in rule-based and hybrid NLP segments as well as other types of NLP. Rule-based NLP has its main focus on pattern matching, an invaluable skill in healthcare that enhances EHRs by making it easier to discover and manage arbitrary phrases.
This hybrid approach brings together the advantages of both rule-based and machine learning methods, combining natural language processing with both. Human expertise is necessary for accurate analysis, while machine learning makes scaling up that analysis simple. Organizations can leverage both statistical and rule-based NLP technologies in a hybrid approach that capitalizes on their respective strengths and weaknesses. This hybrid approach to NLP can be utilized in many ways; there are various options for managing data and speeding up business decisions with this systematized approach.
By Component Analysis
In 2022, 72.6% of revenue originated from solutions. An NLG program is comprised of engines, platforms, and tools that translate computer code into a language understandable to humans. Deep Learning can be used by data analysts as well as non-technical people for data analysis and information extraction. Furthermore, natural language processing (NLP) software helps generate illegal comprehensions from digital data sets.
The service segment is the second leading segment which is anticipated to grow at a significant CAGR during the forecast period, driven by advances in software implementation, reduced deployment costs and risks, optimized existing installations, and other factors. This sector offers businesses various services for natural language generation that businesses can influence. These offerings are probable to be highly demanded because of the increasing adoption of natural language generator software across various industries. These professionals assist businesses in efficiently using these tools while increasing their potential.
By Deployment Analysis
On the basis of deployment on-premise segment is projected to account for the leading deployment segment; the on-premises NLP deployment provides full control, visibility, and authentication security controls over data scaling to match corporate demand while improving efficiency with built-in redundancy. Cloud-based NLP is expected to drive market expansion with its fastest growth over the forecast period; cloud services are expected to experience maximum expansion within this segment.
Cloud computing has revolutionized the NLP market by enabling cloud-based deployment. Cloud-based solutions offer greater capacity to handle huge datasets and provide a superior consumer experience than on-premise solutions, leading many businesses to choose cloud-based deployment instead of on-site setup. Since many enterprises lack the necessary infrastructure or networks that can accommodate such large datasets, there is an immense demand for cloud-based deployment in this space.
By Application Analysis
On the basis of applications, the market is dominated by automatic summarization in terms of application. Natural language processing (NLP), which aids compliance teams in identifying and analyzing essential information hidden in structured data, can also be used to uncover anomalies or hidden patterns from large datasets using sentiment analysis, topic tags, and other techniques. NLP tools are used extensively in threat and risk detection activities. Text summarizing algorithms are software or algorithms that reduce the text to produce a concise summary.
Natural language processing (NLP), which helps compliance teams identify and analyze critical information in structured data, uncovers anomalies and hidden patterns in massive datasets through topic tagging and sentiment analysis, and more, will help them achieve a market share of 18%. NLP tools are widely used in risk and threat detection activities. The challenge of text summarization is to distill a document’s meaning in fewer words and sentences. There are two main types of methods for extracting text data from unstructured text and applying it to an automated summary model.
Note: Actual Numbers Might Vary In The Final Report
By Enterprise Size Analysis
On the basis of enterprise size in 2022, large enterprises held the leading revenue share of 62.1% due to strong demand for predictive approaches to data security. Many businesses have already adopted natural language processing-based tools for cloud data processing due to their ease of accessibility and scalability; however, due to costly infrastructure setup expenses and lack of awareness regarding NLP’s numerous benefits on various fronts, adoption among small and medium-sized enterprises (SMEs) has been relatively low.
The accessibility of NLP tools in the cloud and an expanding global market for cloud service providers are expected to revolutionize business operations for small and medium-sized enterprises (SMEs). Smaller firms will have a greater capacity for orchestrating processes to integrate multiple instruments. Furthermore, the COVID-19 epidemic and associated disruptions forced SMEs to reevaluate their strategies in order to enhance customer satisfaction levels and remain competitive globally.
By Industrial Vertical Analysis
On the basis of industry verticals in 2022, the healthcare segment holds a significant revenue share of 23.1% because of the use of the advanced technologies and software within this space, such as predictive analytics, natural language processing tools, automation software and cloud-based programs healthcare professionals can explore popular online discussion forum to better comprehend customers concerns during the lockdown.
Key Market Segments
By Type
- Statistical NLP
- Rule Based NLP
- Hybrid NLP
By Component
- Solution
- Services
By Deployment
- On-Premises
- Cloud
By Application
- Automatic Summarization
- Content Management
- Language Scoring
- Sentiment Analysis
- Data Extraction
- Risk and Threat Detection
- Others Applications
By Technology
- Interactive Voice Response (IVR)
- Optical Character Recognition (OCR)
- Text Analytics
- Speech Analytics
- Classification & Categorization
- Pattern & Image Recognition
- Other Technologies
By Enterprise Size
- Small and Medium-sized Enterprises (SMEs)
- Large Enterprises
By Industry Vertical
- Healthcare
- Retail
- High Tech and Telecom
- BFSI
- Automotive & Transportation
- Advertising & Media
- Manufacturing
- Other Industry Verticals
Drivers
Cloud-based NLP solutions are being used by organizations to expedite the collection and processing of valuable data. Voice search natural language processing technology and voice search chatbots collect this information using various AI-powered cloud-based tools like interactive voice recognition and voice search, which then enable market and predictive analyses on products. However, AI technology has revolutionized Big Data analytics with automated data collection tasks that save time. Many leading companies around the world now offer AI-based software tools designed for automation resolutions.
Restraints
Increasing data security issues of the NLP-based software with limited interoperability among companies restrain the market growth. Apple’s Siri and IBM’s Watson use software for sentimental analysis, authorship attributions, and other core functions. Unfortunately, this system can be weak to security flaws which can decrease market growth. Companies that are facing high prices of cyber security and malware attacks should anticipate their growth rates to be slowdown as a result of the costs.
Opportunity
Growing digitalization and technological advancements in healthcare facilities create an abundance of data. Analytics is a key strategy for organizations looking to leverage this wealth of information. This organization with text data necessitates them to invest in sophisticated systems. NLP is an invaluable technology that can extract useful insights from vast amounts of data; over the past ten years, there has been an outstanding increase in demand for data management and advanced analytics within the healthcare sector.
The growing use of mobile data management apps and analytics applications in this market is anticipated to increase NLP technology has enabled predictive analytics and has contributed to alleviating population health issues. This is considered the most important opportunity in the global natural language processing market.
Trends
Market growth is being driven by the increasing use of digital technology-based software by global enterprises and businesses. To streamline operations, many major players have invested in NLP software that utilizes recent technologies.
Market players are expected to increase their spending on advanced technology and protocols because of the rising demand for these tools in light of the COVID-19 pandemic. This will boost the revenue of the market as well as enable them to expand their product ranges, raise brand awareness, and collaborate with established companies in order to remain competitive after COVID-19.
Regional Analysis
North America is forecasted to maintain the largest revenue share of 30.7% by 2022, driven largely by AI and machine learning technologies. Furthermore, its presence among key market participants, such as Microsoft and IBM, makes it one of the key marketplaces for natural language processing services. Furthermore, regional governments are actively encouraging companies to use these advanced technologies, such as AI, ML, and NLP, which are helping market participants expand their operations within North America.
Asia Pacific is predicted to hold the highest compound annual growth rate of 43.2% during the forecast period because of growing smartphone usage, rapid technological advances, the digitalization of economies, and government initiatives from developing countries in this region. Furthermore, it holds leading positions in cutting-edge industries like robotics as well as possessing superior IT infrastructure, software applications, and service offerings – factors that would create profitable growth prospects for this market.
Note: Actual Numbers Might Vary In The Final Report
Key Regions and Countries Covered in this Report:
- North America
- The US
- Canada
- Europe
- Germany
- France
- The UK
- Spain
- Italy
- Russia
- Netherland
- Rest of Europe
- APAC
- China
- Japan
- South Korea
- India
- Australia
- New Zealand
- Singapore
- Thailand
- Vietnam
- Rest of APAC
- Latin America
- Brazil
- Mexico
- Rest of Latin America
- Middle East and Africa
- South Africa
- Saudi Arabia
- UAE
- Rest of MEA
Key Players Analysis
Key players prioritize developing their customer base in order to gain a competitive benefit. Therefore, companies take several strategic actions such as mergers & acquisitions, new product/technology development partnerships, and collaborations. Stakeholders can also emphasize product differentiation and technological advances. Furthermore, intensive efforts on organic and inorganic growth strategies could potentially enable companies to expand into untapped regions.
Market Key Players
With the presence of many local and regional players, the market for Natural Language Processing Market is fragmented. Market players are subject to intense competition from top market players, particularly those with strong brand recognition and high distribution networks. To stay on top of the market, companies have gained various expansion strategies such as partnerships and product launches.
- Apple Inc.
- Inc
- Google Inc.
- Hewlett-Packard Enterprise
- IBM Corporation
- Intel Corporation
- Microsoft Corporation
- Narrative Science
- SAS Institute Inc.
- Verint Systems, Inc.
- Other Key Players
Recent Development
- August 2023: Meta launched SeamlessM4T, a pioneering AI translation model with multimodal and multilingual capabilities. This advanced model supports speech recognition in nearly 100 languages, facilitates speech-to-text and speech-to-speech translations across numerous languages, and enhances cross-lingual communication through both speech and text.
- August 2023: Google Cloud formed a strategic partnership with AI21 Labs, an Israeli startup specializing in generative AI and large language models (LLMs). Through this collaboration, AI21 Labs leverages Google Cloud’s AI/ML infrastructure to enhance model training and inferencing, offering customers tailored generative AI integration via BigQuery.
- March 2023: Baidu introduced ERNIE Bot, a generative AI model enriched with knowledge-based enhancements. ERNIE Bot is designed to comprehend human intentions and deliver responses that are precise, coherent, and nearly indistinguishable from human interaction.
Report Scope
Report Features Description Market Value (2023) US$ 37.1 Bn Forecast Revenue (2032) US$ 453.3 Bn CAGR (2023-2032) 33.1% Base Year for Estimation 2022 Historic Period 2016-2022 Forecast Period 2023-2032 Report Coverage Revenue Forecast, Market Dynamics, COVID-19 Impact, Competitive Landscape, Recent Developments Segments Covered By Type (Statistical NLP, Rule Based NLP, and Hybrid NLP), By Component (Solution and Services), By Deployment (On-Premises and Cloud), By Application (Sentiment Analysis, Data Extraction, Risk And Threat Detection), By Technology (Interactive Voice Response (IVR), Optical Character Recognition (OCR), Text Analytics), By Enterprise Size (Small and Medium-sized Enterprises (SMEs) and Large Enterprises), By Industry Vertical (Healthcare, Retail, High Tech and Telecom, BFSI) Regional Analysis North America – The U.S. & Canada; Europe – Germany, France, The UK, Spain, Italy, Russia, Netherlands & Rest of Europe; APAC- China, Japan, South Korea, India, Australia, New Zealand, Singapore, Thailand, Vietnam & Rest of APAC; Latin America- Brazil, Mexico & Rest of Latin America; Middle East & Africa- South Africa, Saudi Arabia, UAE & Rest of MEA Competitive Landscape Apple Inc., Meta Inc., Google Inc., Hewlett-Packard Enterprise, IBM Corporation, Intel Corporation, Microsoft Corporation, Narrative Science, SAS Institute Inc., Verint Systems, Inc., and Other Key Players Customization Scope Customization for segments, region/country-level will be provided. Moreover, additional customization can be done based on the requirements. Purchase Options We have three licenses to opt for: Single User License, Multi-User License (Up to 5 Users), Corporate Use License (Unlimited User and Printable PDF) Frequently Asked Questions (FAQ)
What is Natural Language Processing (NLP)?Natural Language Processing (NLP) is a branch of artificial intelligence (AI) that focuses on the interaction between computers and human languages. It enables computers to understand, interpret, and generate human language, allowing for tasks such as language translation, sentiment analysis, text summarization, and speech recognition.
What are the key applications of Natural Language Processing?NLP finds applications in various fields, including healthcare, customer service, marketing, finance, and education. It is used for tasks such as chatbot development, language translation services, voice-activated assistants, content analysis, and information retrieval, among others.
How big is the natural language processing market?The Global Natural Language Processing Market in terms of revenue was estimated to be worth USD 37.1 Bn in 2023 and is poised to reach USD 453.3 Bn by 2032, growing at a CAGR of 33.1% from 2023 to 2032.
What is the demand of NLP in the market?The demand for NLP in the market is driven by the need for automated language-based tasks, personalized user experiences, and data-driven insights across industries such as healthcare, finance, customer service, and marketing. NLP enables organizations to extract valuable information from text and speech data, improve customer interactions, and enhance decision-making processes through automated language processing and analysis.
How does Natural Language Processing contribute to business growth?NLP contributes to business growth by enabling organizations to automate various language-based tasks, enhance customer interactions, extract valuable insights from unstructured data, improve decision-making processes, and develop more personalized and user-friendly products and services.
Who are the leaders in the natural language processing market?Top Key Players: Apple Inc., Meta Inc., Google Inc., Hewlett-Packard Enterprise, IBM Corporation, Intel Corporation, Microsoft Corporation, Narrative Science, SAS Institute Inc., Verint Systems, Inc., and Other Key Players
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