Natural Language Processing Market

Natural Language Processing Market Outlook from 2023 to 2033

As of 2023, the global natural language processing (NLP) market boasts an impressive valuation of USD 17.08 billion. Businesses across different sectors increasingly recognize the transformative potential of NLP. This lays the groundwork for substantial growth, with estimates suggesting the market could surpass USD 140.23 billion by 2033. This growth trajectory is underpinned by an exceptional CAGR of 23.4%, highlighting the market's remarkable potential over the next decade.

Key Highlights

• The demand for natural language processing technologies, exemplified by industry leaders like Siri, Alexa, and Google Search, is experiencing a robust surge.
• Despite not being a very novel field, natural language processing (NLP) has recently gained significant attention, primarily due to the ChatGPT generative AI hype train.
• Natural language processing is gaining immense popularity in North America and Europe due to its transformative potential in enhancing automation and decision-making processes across various industries.
• The focus of top companies is on integrating NLP in processes, including sentiment analysis, machine translation, speech recognition, chatbots, text categorization, market intelligence, and spell-checking.

Attributes	Details
Natural Language Processing Market Size in 2022	USD 14.02 billion
Natural Language Processing Market Size in 2023	USD 17.08 billion
Natural Language Processing Market Projected Size by 2033	USD 140.23 billion
Forecasted Value CAGR from 2023 to 2033	23.4%

A Comprehensive Look at the Top Trends Shaping the Global Natural Language Processing Industry Trends

Growing Demand for Automation: The automation era is here, and businesses are starting to adopt it. Over the past two years, the demand for automation from business leaders has surged for over 90% of enterprises.

• Businesses are looking for methods to automate their procedures and workflows to promote development, efficacy, and profitability in an environment of intense market competition and macroeconomic instability.
• Automation in customer support, content creation, and other areas is made possible by NLP technology's capacity to comprehend and react to human language.

Emergence of Conversational AI Platforms: The corporate landscape is changing dramatically as a result of automation and artificial intelligence.

• The capabilities of NLP systems have been substantially improved by the ongoing improvements in machine learning techniques and artificial intelligence.
• Conversational AI can now understand human language and reply to customer inquiries without human involvement through advances in natural language processing. Creating language models like OpenAI's GPT-3 has been one of the most important developments in NLP. These models can produce human-like language since they were trained on vast volumes of text data.

Efficient Data Extraction and Analysis: Demand for reliable NLP solutions has arisen due to the exponential development of data supplied through numerous sources, including social media, emails, consumer reviews, and more.

• A substantial amount of the big data that is accessible for analysis comes in the form of text. The gathering of crucial and useful information from the accessible data is made possible by text analysis using NLP. This capability has significantly influenced the text analytics market, driving its adoption across various industries.
• By assisting in the extraction of valuable insights from unstructured data, these solutions aid in empowering organizations to make well-informed decisions.

Enhanced Customer Experience: In recent years, the demand for automated customer care methods in customer-centric organizations has seen a noticeable rise.

• Many businesses place a high focus on improving client relations. Chatbots and virtual assistants with NLP capabilities improve customer service. Customers can now receive rapid replies from NLP chatbots without engaging with human individuals.
• Numerous corporate sectors, including banking, manufacturing, education, the legal system, and healthcare, have benefited from this application.

Technological Integration and Scalability: NLP's importance has gone up with the rise of voice-activated technology and the Internet of Things (IoT).

• Voice assistants have developed from simple voice commands to complex conversational interfaces like Siri, Alexa, and Google Assistant. They utilize NLP to comprehend and react to human language, making these intelligent systems an essential to daily life.
• The natural language processing industry 4.0 has a remarkable fusion of cutting-edge technology and linguistic sophistication. Similar to how more search queries helped Google's search, more data and higher user involvement are going to promote NLP technology.

Historical Analysis alongside Natural Language Processing [NLP] Market Forecast

The global NLP market growth surged by USD 3.06 billion from 2022 to 2023. The growth in the global healthcare natural language processing sector is nothing short of phenomenal. During the COVID-19 pandemic, the application of AI and NLP gained even more significance. Businesses are increasingly focused on improving customer experiences and expanding operations. Within healthcare, NLP played a critical role in analyzing patient data, clinical notes, and medical literature. Disease diagnosis, treatment planning, and drug discovery were ministered. The demand for accurate health records, particularly during the pandemic, further propelled the popularity of NLP systems like Electronic Health Records (EHR) in the healthcare sector.

Looking forward to 2023, Globalization has increased the demand for NLP tools that can handle numerous languages. AI systems have significantly improved the accuracy and scalability of NLP systems. It now enables computers to communicate across different languages and application areas. By offering precise translation, sentiment assessment, and localization, NLP aids firms in their expansion into foreign markets.

The global natural language processing market size is likely to grow 8.2X by 2033-end. NLP is going to grow more popular as a means of addressing inquiries and providing personalized care to customers. Expansion of the eCommerce sector and wide application of online platforms are likely to support this demand. Recommendation engines for eCommerce platforms are powered by NLP, which improves user experience and boosts sales. NLP can generate recommendations for items matching interests by examining user behavior and reviews.

Natural language generation (NLG), a subset of natural language processing, is becoming popular. Given recent developments in artificial intelligence and machine learning, NLG systems now have much better capabilities. It is now a workable option for multiple applications since the resultant produced material is more precise and cohesive. NLG opens doors for NLP market players to expand their service offerings. Companies can satisfy a broader spectrum of customer demands by adding NLG capabilities to their current products or developing unique NLG solutions.

Natural Language Processing Market Growth Analysis by Key Country

When it comes to the NLP market, North America and Europe stand as the leading regions. North America, particularly the United States, leads the global NLP market, given its technological prowess. Europe, as a whole, boasts a robust tech ecosystem. Countries like the United Kingdom and Germany have thriving AI communities that foster innovation in NLP.

Countries	2023 Value Share in Global Market
United States	23.2%
Canada	6.3%
United Kingdom	8.2%
Germany	7.4%
China	7.1%
India	6.5%

Natural Language Processing offers a Golden Opportunity for App Developers in the United States

The United States’ natural language processing market dominance stems from its sizable, dynamic economy. Start-ups and established businesses profit from this since it provides crucial financial resources for NLP research, development, and commercialization.

• Demand for NLP is likely to upsurge as the government is increasingly supporting the use of AI, ML, and NLP technologies. Speech recognition market participants can now more firmly establish themselves in the nation as a result of this. The Centers for Disease Control and Prevention and Food and Drug Administration collaborated on a project called Development of a Natural Language Processing (NLP) Web Service for Public Health Use. It aims to create an NLP web service that is publically accessible to assist researchers in transforming fragmented clinical data into organized coded data.

• The predominance of leading market players in the United States promotes innovation in the market. This, in turn, fuels the natural language processing industry expansion. For instance, Meta unveiled SeamlessM4T in August 2023, a revolutionary AI translation model that is the first to have complete multimodal and multilingual capabilities. People can easily interact across languages through written and verbal communication with this ground-breaking concept.
• Online consumers in the United States are more likely to rely on Google Assistant compared to other platforms, according to RichRelevance. Other application developers now have an enormous opportunity to target prospective customers.

Canada's Government Pioneers Natural Language Processing Integration across Sectors

The government in Canada is taking a forward-thinking approach aimed at leveraging natural language processing in multiple sectors. At Employment and Social Development Canada (ESDC), the Data Science Division of the Chief Data Office (CDO) has started a research study on the application of natural language processing (NLP) for both official languages. This project, supported by ESDC's Innovation Lab, intends to improve the CDO's comprehension of how the language (French or English) affects the value of the tools and techniques used in NLP. NLP has been utilized in areas including customer service, healthcare, finance, and content analysis, with the growing acceptance of AI-driven technology across these sectors. This significantly influences the natural language processing market growth in Canada.

The United Kingdom is a Hub of Natural Language Processing Excellence and Innovation in Europe

The United Kingdom's leading position in the Europe NLP market stems from its strong ecosystem of universities, research institutions, and tech companies focused on NLP advancements.

• The United Kingdom's expertise in fusing machine learning techniques with natural language processing makes it particularly strong in this area. VocalIQ, a leader in natural language processing, was acquired by Apple in addition to Magic Pony by Twitter. There are plenty of additional promising new entrants in the United Kingdom.
• The United Kingdom invests in AI greater than any other European country. In its Industrial Strategy, the United Kingdom government declared that it wanted to position the country as a global leader in AI and informational developments. The IBM-developed Arthritis Virtual Assistant is learning from interactions with patients to provide individualized information and advice on medication, nutrition, and exercise.

Germany's Tech-forward Culture Offers a Fertile Ground for Natural Language Processing Innovation

Technology adoption and innovation are strongly ingrained in German culture. This is mirrored in the country's receptivity to new technological advancements, which makes it the perfect market for NLP start-ups seeking to establish the worth of their offerings. One of these organizations is the Germany-based start-up Kern AI, which has developed a platform for NLP developers and data scientists to manage the labeling process. It also automates and coordinates tangential tasks and enables them to handle low-quality data that is presented to them. NLP is now one of the up-to-the-minute developments in AI, and Kern AI revealed in February 2023 that the company secured US$ 2.9 million in initial investment to accelerate its recent growth and the adoption of NLP by businesses.

Natural Language Processing Technologies Reshape Industries in China's Tech Revolution

The mainstay of China’s AI language processing market is computer vision. Production, protection, banking, internet, logistics, modern retail, and healthcare industries find extensive applications. Over the past decade, China has seen great growth in natural language processing AI technologies.

• Smart speakers' enormous popularity and chatbots' emergence fuel their demand across industries. NLP technology industry is widespread throughout education, healthcare, legal, and social media. Ongoing technological advancements combined with extensive market education are causing interactive AI vertical application scenarios to mature in China.
• To improve accuracy and understanding of the subtleties of the Chinese language, several businesses are making significant investments in cutting-edge NLP algorithms. In August 2020, Baidu released Qian Yan, the leading Chinese natural language processing database in the world. The initiative was a partnership with the industry organization China Computer Federation. It was designed to assist the sector in overcoming the paucity of computer power and language data, two obstacles to advancing the speech recognition technology market.

India Emerges as a Hotbed for Natural Language Processing Invention in the Tech Industry

Internet and software businesses are paying close attention to India as it is attracting tons of interest. The demand for mobile speech recognition software technologies is experiencing an exponential surge along with fast internet. As a result, the language processing solutions market has augmented substantially in India.

• Artificial intelligence and natural language processing research and development have become widely recognized in India. Numerous research teams in India have made substantial natural language processing market advancements because of its robust academic ecosystem. Leading companies in the sector, including Amazon, IBM, Samsung, LG, Flipkart, and even the Indian government, have worked with the Computation for Indian Language Technology (CFILT) Lab at IIT Bombay.
• The government is taking a proactive approach toward fostering technological innovation, including NLP. The government wants to include the technological invention, creation, and consumption of start-ups. Recently, the Ministry of Electronics and IT discussed with researchers and start-ups to develop a plan for Digital India BHASHINI. The artificial intelligence (AI)-driven language translation platform BHASHINI is based in India. A Bhashini Platform is going to offer medium, small, and micro enterprises, start-ups, and individual innovators public access to artificial intelligence and natural language processing resources.

Natural Language Processing Market Growth Analysis by Key Segment

As far as the technology is concerned, the auto coding segment dominates the global market in 2023, accounting for a 23.3% share. Similarly, the statistical natural language processing segment takes the lead when considering the product type, commanding a 43.4% market share in 2023.

Segment	Market Share in 2023
Auto Coding	23.3%
Statistical Natural Language Processing	43.4%

Auto Coding in NLP Maximizes Productivity and Efficiency

The surge in demand for auto coding in NLP arises from its ability to enhance productivity and efficiency in data-driven industries. An important gap in data processing and analysis is filled by auto-coding. Automated systems that can effectively identify and handle this data are urgently needed, given the exponential development of unstructured data. This is particularly prevalent in sectors like healthcare, finance, and marketing. Manual coding takes a lot of time, is prone to human mistakes, and, at times, cannot handle the amount of data generated. By streamlining this process, auto-coding technologies help companies get insights from their data with greater speed and precision. This imperative need for efficient data handling is driving the rapid adoption and advancement of auto coding solutions, driving natural language processing market growth.

Statistical NLP Meets the Surge in Unstructured Text Data

The explosion of unstructured text data on the internet has driven the surging demand for statistical natural language processing. An unprecedented amount of content is being produced every day as a result of the growth of social media, blogs, forums, and other digital platforms. Organizations across various industries understand the enormous importance of information retrieval, sentiment analysis, and insight extraction from this data. Moreover, the rise of multilingual communication is another key factor driving the demand for statistical NLP to new heights. Businesses are no longer restricted to one language demography in today's connected world. To serve numerous international audiences, they are extending their reach. Communication in various languages needs to be fluid to accomplish this.

Competitive Landscape

Many suppliers concentrate on growing their customer base to get an edge in the natural language processing market. As a result, important businesses engage in various strategic measures, such as mergers and acquisitions, joint ventures to develop new products and technologies, and collaborations. Additionally, stakeholders stress technology improvements and product distinctiveness.

Recent Developments in the Natural Language Processing Market

• Cooperation between Google Cloud and AI21 Labs, an Israeli firm that uses large language models (LLMs) and generative AI to revolutionize text, was made public in August 2023. To hasten model training and inference, AI21 Labs makes use of Google Cloud's specialized AI/ML infrastructure. Through BigQuery interfaces and functions, users can effortlessly incorporate sector-specific generative AI capabilities due to this alliance.
• Amazon and IIT Bombay joined together to create the Amazon IIT-Bombay AI-ML Initiative in March 2023. Advanced machine learning and artificial intelligence research in the fields of language, voice, and multimodal AI is being facilitated by this initiative.
• Project Wisdom, which aims to include natural language processing (NLP) into the open-source Ansible IT operations automation platform, was announced by Red Hat and IBM in October 2022. The goal is to open IT automation to a broader spectrum of consumer groups and IT specialists who don't have the declarative programming abilities needed to utilize YAML files to automate IT activities.

Key Companies Profiled in the Natural Language Processing Market

• IBM Corporation
• Dolbey Systems Inc.
• Oracle Corporation
• Apple Inc.
• 3M Co.
• Netbase Solutions Inc.
• Hewlett -Packard Inc.
• Microsoft Corporation
• SAS Institute Inc.
• Verint Systems Inc.

Table of Content

• 1. Executive Summary
• 2. Market Overview
• 3. Market Background
• 4. Global Market Analysis 2018 to 2022 and Forecast, 2023 to 2033
• 5. Global Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Technology
  • 5.1. Auto coding
  • 5.2. Text Analytics
  • 5.3. Optical Character Recognition (OCR)
  • 5.4. Interactive Voice Response
  • 5.5. Pattern & Image Recognition
  • 5.6. Speech Analytics
• 6. Global Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Type
  • 6.1. Rule Bases
  • 6.2. Statistical
  • 6.3. Hybrid
• 7. Global Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Service
  • 7.1. Integration Services
  • 7.2. Consulting Services
  • 7.3. Maintenance Services
• 8. Global Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Deployment Model
  • 8.1. On-Premise
  • 8.2. On-Demand
• 9. Global Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Application
  • 9.1. Sentiment Analysis
  • 9.2. Data Extraction
  • 9.3. Risk and Threat Detection
  • 9.4. Automatic Summarization
  • 9.5. Content Management
  • 9.6. Language Scoring
  • 9.7. Others
• 10. Global Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Vertical
  • 10.1. Healthcare Sector
  • 10.2. Public Sector
  • 10.3. Retail Sector
  • 10.4. Media & Entertainment
  • 10.5. Manufacturing
  • 10.6. Other Sector
• 11. Global Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Region
  • 11.1. North America
  • 11.2. Latin America
  • 11.3. Western Europe
  • 11.4. Eastern Europe
  • 11.5. South Asia and Pacific
  • 11.6. East Asia
  • 11.7. Middle East and Africa
• 12. North America Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Country
• 13. Latin America Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Country
• 14. Western Europe Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Country
• 15. Eastern Europe Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Country
• 16. South Asia and Pacific Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Country
• 17. East Asia Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Country
• 18. Middle East and Africa Market Analysis 2018 to 2022 and Forecast 2023 to 2033, By Country
• 19. Key Countries Market Analysis
• 20. Market Structure Analysis
• 21. Competition Analysis
  • 21.1. IBM Corporation
  • 21.2. Dolbey Systems Inc.
  • 21.3. Oracle Corporation
  • 21.4. Apple Inc.
  • 21.5. 3M Co.
  • 21.6. Netbase Solutions Inc.
  • 21.7. Hewlett-Packard Inc.
  • 21.8. Microsoft Corporation
  • 21.9. SAS Institute Inc.
  • 21.10. Verint Systems Inc.
• 22. Assumptions & Acronyms Used
• 23. Research Methodology