Natural Language Processing Market Anticipated to Generate a Revenue of $42,389.8 Million, Growing at a CAGR of 20.6% from 2020 to 2027Download Sample Reports Overview
The global natural language processing market forecast is estimated to be $42,389.83 million by 2027, rising from $9701.5 million in 2019, at a CAGR of 20.6%.
Impact Analysis of COVID-19 on the Global Natural Language Processing Market
The coronavirus outbreak in 2020 dramatically affected the natural language processing services industry worldwide Due to the sudden outbreak of COVID-19 various industries around the world has faced various issues such as loss of business due to the sudden shutdown guidelines laid out by government bodies. Almost all the companies around the world had to work from home causing complete dependency on software-oriented services and solutions. Hence, there has been rapid increase in adoption of NLP services during the lockdown. This is due to the ability of NLP to organize data while addressing the queries and feedbacks from customers with the help of chatbots. This process of collection and organizing of data has helped many companies to understand and serve their customers in a better way during the COVID-19 crisis.
Natural Language Processing Market Analysis
Increasing need to understand customer enquiries, feedbacks, or requirements is boosting the demand for natural language processing services and solutions. Various companies are constantly looking for an opportunity to enhance customer experience capabilities. The combination of artificial intelligence with natural language processing has made it easier for organizations to analyze customers feedbacks or enquiries. The amalgamation of artificial intelligence and natural language processing helps in analyzing the customers inquiry or feedbacks and further converts them into individual solutions.
On the other hand, use of code-mixed (CM) language might be a restraining factor and might hamper the growth of the market. Code-Mixed (CM) language is the alteration of languages within a conversation and is a common communicative phenomenon that occurs in multilingual communities across the world. NLP tasks such as normalization, language identification, and Automatic Speech Recognition (ASR) face issues while working on non-canonical multilingual data in which two or more languages are mixed.
Increase in healthcare investments are generating major opportunities in the natural processing language market. The healthcare sub-segment is generating a large amount of data with the analytics-driven approach. As a consequence, NLP has appeared as an important technology to extract meaningful insights from such large volume of data. The consequent demand for effective data management and advanced data analytics has also seen a significant rise in the healthcare industry over the recent years.
Natural Language Processing Market, Segmentation
The global natural language processing market is segment based on component type, deployment type, type, application type, vertical type, and region.
On the basis of component, natural language processing is divided into solutions and services. The solution segment was the highest contributor to the market, with $5,048.3 million in 2019, and is estimated to reach $20,029.5 million by 2027 with a CAGR of 19.1% during the forecast period. The demand for NLP software tools and platforms that provide services and solutions are increasing globally due to the rising demand to gain real-time insights from voice or speech data across different verticals.
On the basis of deployment, natural language processing is divided into cloud and on-premise model. The on-premises segment was the highest contributor to the market, with $5,327.9 million in 2019, and is estimated to reach $19,975.5 million by 2027, at a CAGR of 18.2% during the forecast period. The rise in the growth of this sub-segment is because a cloud-based natural language processing platform enables users to utilize and analyze multilingual content and user-generated content and other web-content.
On the basis of type, natural language processing is segmented into rule based, statistical, and hybrid. The statistical segment was the highest contributor to the market, with $3,701.6 million in 2019, and is estimated to reach $14,655.4 million by 2027, at a CAGR of 19.1% during the forecast period. Statistical natural language processing (NLP) intends to perform statistical inference for the field of natural language processing and also enables natural the conversations between chatbot and humans or allocates human resources effectively to rectify the customers issues or to collect the feedbacks.
On the basis of application type, natural language processing is segmented into machine translation, automatic summarization, sentiment analysis, text classification, question answering, and others. The machine translation segment was the highest contributor to the market, with $2,394.3 million in 2019, and is estimated to reach $9,454.8 million by 2027.. This advantage of machine translation is increasing the sub-segments growth.
On the basis of application type, natural language processing is segmented into automotive, BFSI, government, healthcare, media & entertainment, retail & consumer goods, and others. The media and entertainment sub-segment was the highest contributor to the market, with $1,931.1 million in 2019, and is estimated to reach $7,676.8 million by 2027. The rising adoption of digital entertainment has been transforming the way media companies around the world operate and advertise to reach their audience. There is a dire need for adding personalization and delivering value to meet the rising customer expectations and demand. Several companies in the media and entertainment sector are turning to artificial intelligence (AI) technologies to deliver such customer experiences at scale.
The NLP market was investigated across North America, Europe, Asia-Pacific, and LAMEA. North America was the highest revenue contributor, accounting for $3,669.1 million in 2019, and is estimated to reach $14,935.2 million by 2027. The organizations in North America are investing in the advancements of NLP and its applications. With the increasing unstructured data by many start-ups in the U.S., they are gradually deploying natural language processing services. Moreover, Asia-Pacific is estimated to reach $9,264.7 million by 2027, at a significant CAGR of 21.1% on the account of rising awareness and increasing investments in artificial intelligence.
Key Players in the Global Natural Language Processing Market
- Apple Inc.
- Baidu, Inc.
- SAS Institute Inc.
Porter’s Five Forces Analysis for Natural Language Processing Market:
- Bargaining Power of Suppliers: The suppliers operating in the natural language processing market are few in number.
Hence, the bargaining power of the supplier is high.
- Bargaining Power of Buyer: The global market for natural language processing market is fragmented. Hence, there is huge product differentiation found in the natural language processing platform.
Therefore, the bargaining/negotiating power of the buyer is low.
- Threat of New Entrants: Innovative startup enterprises are adopting multiple key strategies like effective tie-ups, along with product innovation to stronghold their position in the world.
Hence, the threat of the new entrants is high.
- Threat of Substitutes: There is no substitute product/service for the natural language processing solutions.
Thus, the threat of substitutes is low.
- Competitive Rivalry in the Market: Strong presence of technology players such as IBM, Apple, Google and Microsoft is creating huge rivalry in the global market. Massive business expansion along with impressive heavy investments in research and innovations are some of the key elements leading to competitive rivalry among key players.
Competitive rivalry in the market is high.