Further, the growing digitization and the use of tools like
chatbots and others across various industries and businesses, allowing organizations to change & upgrade, are some of the few major driving factors for the Global Natural Language Processing Market across the globe.
In May 2023, Argilla, an open source data curation tool, introduced support for Large Language Models (LLMs). This update seeks to aid users in overseeing the full lifecycle of Natural Language Processing (NLP) models from initial experimentation through production deployment.
Argilla allows efficient creation, evaluation, and refinement by combining human expertise and machine input its data curation capabilities streamline this process for faster development with greater performance robustness organizations using this tool can build LLMs that meet diverse applications as quickly as they accelerate adoption and success of NLP technologies across industries.
Key Takeaways
- Market Size & Share: Natural Language Processing Market is expected to reach a value of USD 21.0 billion in 2023, and it is further anticipated to reach a market value of USD 176.0 billion by 2032 at a CAGR of 26.6%.
- Deployment Analysis: In 2023, the on-premise segment dominates with a share of over 62% of the overall global market.
- Type Analysis: The statistical NLP segment secures the largest revenue share, accounting for over 41% of the total revenue in 2023.
- Regional Analysis: In 2023, the solution segment dominates with a significant share of over 76% of the overall global revenue.
- Rising Demand for Multilingual Solutions: Global businesses increasingly adopt multilingual NLP systems to improve customer engagement and accessibility across diverse languages and regions.
- Data Privacy Concerns: Issues related to data security and compliance with regulations like GDPR and CCPA present challenges for wider adoption of NLP technologies.
- Healthcare Opportunities: NLP's role in medical transcription, electronic health records (EHRs), and telemedicine highlights significant growth potential in the healthcare sector.
Market Dynamic
In the past few years, deep learning & algorithms have shown major development in image recognition & speech processing. The use of natural language processing (NLP) has made major contributions, providing excellent outcomes in complex NLP tasks. The domain of NLP has been under significant growth over recent years, mainly driven by the accessibility of cost-effective, scalable computational power, the growing digitization of data, and the integration of NLP with deep learning (DL) &
machine learning (ML).
Further, the market is growing due to the increasing demand for sentiment analytics & content management, which allows organizations to give customized deals based on recent trends, important for understanding consumer behavior. Social media platforms, particularly significant for retail & e-commerce, serve as major sources of data for sentiment analytics, demand prediction, and enhancing the consumer experience.
Driving Factors
Natural Language Processing (NLP) market growth is being propelled by advances in artificial intelligence (AI) and machine learning (ML). Complex algorithms powering NLP systems enable them to process, interpret, and respond more accurately to human language than ever before.
Deep learning techniques like GPT and BERT transformer models have significantly enhanced NLP applications such as chatbots, sentiment analysis and language translation; furthermore their growing adoption across industries like healthcare, finance and customer service has increased demand while their technological evolution provides a solid base for NLP market expansion.
Trending Factors
One notable trend in the NLP market is the increasing need for multilingual solutions to serve global businesses. E commerce, international collaborations and cross border customer interactions all necessitate multilingual NLP systems supporting multiple languages and dialects. Advancements in neural machine translation as well as pre trained multilingual models make accurate translations and cultural context easier to provide than ever.
Accessibility tools for differently abled individuals is driving innovation as organizations use these solutions to increase customer engagement while broaden their global presence making multilingual NLP an integral market trend!
Restraining Factors
Data Privacy and Security Concerns Privacy and security issues pose major restraints on the growth of the NLP market. NLP systems rely on large volumes of user data for training and operation, raising issues around confidentiality, compliance with regulations like GDPR and CCPA, misuse, vulnerabilities in cloud based NLP services as well as misuse.
Organizations often refrain from adopting NLP solutions due to breaches and legal repercussions arising from breaches in encryption, data processing security standards and evolving privacy standards; which requires dedicated resources as well as resources devoted by smaller enterprises to address.
Opportunities
Healthcare provides immense potential for NLP markets. NLP technologies are being increasingly employed for medical transcription, patient record analysis, and to draw insights from unstructured data such as clinical notes. Accelerated diagnosis, tailored treatment plans, and efficient management of electronic health records (EHRs).
Furthermore, the growth of telemedicine and virtual assistants powered by NLP is revolutionizing patient interactions. With the goal of improving healthcare outcomes and cutting costs in mind, organizations are increasingly investing in AI powered solutions. As research in biomedical NLP advances, its market is expected to expand by meeting critical healthcare system challenges head on.
Research Scope and Analysis
By Deployment
In 2023, the on-premise segment dominates with a share of over
62% of the overall global market. On-premises NLP deployment provides complete control, visibility, & robust security measures for data. Moreover, it enables easy scalability to meet corporate demands and improves efficiency through built-in redundancy. The growing adoption of cloud-based NLP solutions is anticipated to propel market growth, with the cloud segment expected to experience fast expansion during the forecast period.
By Type
The statistical NLP segment secures the largest revenue share, accounting for over
41% of the total revenue in 2023. However, significant growth is projected for the rule-based NLP and hybrid NLP segments during the forecast period.
Rule-based NLP places a strong emphasis on pattern matching, particularly valuable in healthcare for enhancing the electronic health record (EHR) process. This facilitates the identification of specific phrases and improves the effectiveness of data management.
The hybrid approach integrates rule-based & machine-learning methods, merging natural language processing, machine learning, & human input. Human expertise ensures accurate analysis, while machine learning simplifies scalability. By adopting this hybrid strategy, organizations can capitalize on the advantages of both rule-based and statistical NLP technologies to enhance data management and accelerate business decisions.
By Component
In 2023, the solution segment dominates with a significant share of over
76% of the overall global revenue. NLG programs, composed of engines, platforms, tools, and interfaces, played a crucial role in translating computer code into human-readable language.
Deep learning served as a tool not only for data analysts but also for individuals without technical expertise, aiding in information comprehension. Moreover, natural language processing software played a key role in extracting actionable insights from digital data, contributing to a better overall understanding.
By Technology
In 2023 text analysis holds a significant position within the technology segment for the growth and expansion of the global market. Employing NLP to derive valuable insights from written content. It evaluates market sentiments through sources like news and social media, effectively combating false information.
In healthcare, it identifies potential drug candidates, while in business, it aids brand monitoring and product refinement through feedback, culminating in impactful e-commerce recommendations. Moreover, it plays a role in understanding intricate political discussions. In the expansive realm of technology, text analysis stands as a foundational tool, unveiling essential insights from various textual sources.
By Organization Size
In 2023, the large enterprise segment dominates the overall revenue share of over 64%, driven by the need for anticipated security measures. Businesses adopted cloud-based NLP tools for data processing due to accessibility. However, smaller businesses showed less adoption of NLP generation due to high costs and limited awareness.
Affordable cloud-based NLP tools and the growing cloud service market are expected to boost small and medium-sized enterprises (SMEs). SMEs are likely to focus on process integration. COVID-19 prompted them to enhance customer satisfaction and global competitiveness by enhancing business strategies.
By End-user Industry
In 2023, the healthcare sector secured a major share of over 24% of the global NPL market. This achievement resulted from the progressive integration of advanced technologies, including predictive analytics, NLP tools, automation, and cloud-based software. Notably, the healthcare field adeptly harnessed online comment boards to gauge consumer concerns during the COVID-19 pandemic, further reinforcing its impact.
Meanwhile, the IT & telecommunications segment thrived, exhibiting the highest growth rate across the forecasted period. Through strategic utilization of natural language processing, communication received a significant boost. This involved the automatic rectification of grammar errors in messaging applications and the proficient analysis of multiple languages. This strategic approach paved the way for establishing a comprehensive system skilled at parsing texts across a spectrum of languages.
The Global Natural Language Processing Market Report is segmented on the basis of the following
By Deployment
By Type
- Statistical
- Rule-based
- Hybrid
By Component
By Technology
- Interactive Voice Response
- Optical Character Recognition
- Speech Analysis
- Text Analysis
- Pattern and Image Recognition
- Others
By Organization Size
- SMEs (Small and Medium Enterprises)
- Large Enterprises
By End-user Industry
- BFSI
- Retail
- Healthcare
- IT & Telecom
- Automotive
- Manufacturing
- Others
Regional Analysis
In 2023, North America is leading the overall global market with a substantial
share of over 31% of the global revenue. Renowned for its dominance in AI and machine learning, the region emerged as a pivotal hub for advancing natural language processing (NLP). The concentration of major players, notably in the U.S., fueled innovation, propelling NLP market growth.
Regional governments endorsing AI, ML, and NLP further spurred expansion, empowering industry players to extend their influence. North America's strategic positioning, technological dominance, and government support collectively underscore its pivotal role in shaping the NLP landscape.
By Region
North America
Europe
- Germany
- The U.K.
- France
- Italy
- Russia
- Spain
- Benelux
- Nordic
- Rest of Europe
Asia-Pacific
- China
- Japan
- South Korea
- India
- ANZ
- ASEAN
- Rest of Asia-Pacific
Latin America
- Brazil
- Mexico
- Argentina
- Colombia
- Rest of Latin America
Middle East & Africa
- Saudi Arabia
- UAE
- South Africa
- Israel
- Egypt
- Rest of MEA
Competitive Landscape
The key market players strategically broaden their consumer base for a competitive edge, employing actions like mergers, acquisitions, tech partnerships, and collaborations. Stakeholders look into product innovation and tech advancements. Such efforts, spanning organic and inorganic growth, drive market expansion into untapped territories.
For instance, SAP SE acquired Askdata in July 2022, enhancing AI-driven natural language searches. Likewise, Apple Inc. acquired Inductiv Inc. in May 2020 to bolster Siri's performance. These steps highlight the industry's dynamic pursuit of innovation and competitiveness.
Some of the prominent players in the Global Natural Language Processing Market are
- Google
- IBM Corp.
- Microsoft
- SAP
- 3M
- AWS (Amazon Web Service)
- SAS
- Oracle
- Apple
- Baidu
- Other Key Players
COVID-19 Pandemic & Recession: Impact on the Global Natural Language Processing Market
The COVID-19 pandemic and recession produced major effects on the natural language processing (NLP) market. The shift to remote work and digitization elevated NLP's importance for virtual communication and customer service. The healthcare sector hastened NLP adoption for medical data analysis and pandemic-related sentiment monitoring.
However, economic uncertainty led to varying technology investment decisions, impacting NLP adoption across industries. While sectors like e-commerce saw increased demand for NLP-driven chatbots and recommendations, travel and hospitality faced contraction, affecting NLP projects in those areas.
Report Details
| Report Characteristics |
| Market Size (2023) |
USD 21.0 Bn |
| Forecast Value (2032) |
USD 176.0 Bn |
| CAGR (2023-2032) |
26.6% |
| Historical Data |
2017 - 2022 |
| Forecast Data |
2023 - 2032 |
| Base Year |
2022 |
| Estimate Year |
2023 |
| Report Coverage |
Market Revenue Estimation, Market Dynamics, Competitive Landscape, Growth Factors and etc. |
| Segments Covered |
By Deployment(On-Premises and Cloud), By Type(Statistical, Rule-based and Hybrid), By Component (Solutions, Services and Others), By Technology(Interactive Voice Response, Optical Character Recognition, Speech Analysis, Text Analysis, Pattern and Image Recognition and Others), By Organization Size (Small & Medium-sized Enterprises and Large Enterprises), By End-user Industry(Retail, Healthcare, Automotive, Manufacturing IT & Telecommunication, BFSI, and Others) |
| Regional Coverage |
North America – The US and Canada; Europe – Germany, The UK, France, Russia, Spain, Italy, Benelux, Nordic, & Rest of Europe; Asia- Pacific– China, Japan, South Korea, India, ANZ, ASEAN, Rest of APAC; Latin America – Brazil, Mexico, Argentina, Colombia, Rest of Latin America; Middle East & Africa – Saudi Arabia, UAE, South Africa, Turkey, Egypt, Israel, & Rest of MEA
|
| Prominent Players |
Google, Microsoft, IBM Corp., SAP, SAS, 3M, Oracle, Apple, AWS, Baidu and Other Key Players |
| Purchase Options |
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