Natural language processing market worth $35.1 billion by 2026

Chicago, June 21, 2022 (GLOBE NEWSWIRE) — According to a new market research report “Natural Language Processing Market by Component, Type (Statistical, Hybrid), Application (Automatic Summary, Sentiment Analysis, Risk & Threat Detection), Deployment Mode, Organization Size, Vertical & Region – Global Forecast to 2026″ published by MarketsandMarkets™, the natural language processing market size is set to grow from $11.6 billion in 2020 to $35.1 billion in 2026, at a compound annual growth rate (CAGR) of 20.3% over the forecast period. The growing demand for cloud-based NLP solutions to reduce overall costs and better scalability and the increasing use of smart devices to enable smart environments are expected to drive the growth of the NLP market. The increase in adoption of NLP-based applications across industries to improve customer experience and increase investment in healthcare is expected to open up opportunities for NLP vendors around the world.

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Scope of the report

The NLP market is expected to slow down in 2020 due to the global lockdown. The COVID-19 pandemic has increased the churn rate and shuddered almost every vertical. The lockdown has implications for global manufacturing, supply chain and logistics as the continuity of operations for several vertical markets is severely impacted. The industries with the greatest drawbacks are manufacturing, transportation and logistics, and retail and consumer goods. The availability of essential items is affected by the lack of manpower to work on production lines, supply chains and transportation, although the essential items are exempt from the lockdown. The situation is expected to be under control by early 2021, while demand for NLP solutions and services is expected to grow due to rising demand to improve customer experiences and build personalized relationships with prospects. Several industries are already planning to deploy a wide range of NLP solutions and services to enable digital transformation initiatives, addressing mission-critical processes, improving operations and differentiating customer viewing experiences. Reducing operational costs, better customer experiences, improved customer churn, better visibility into processes and operations, and improved real-time decision making are key business and operational priorities that are expected to drive the adoption of the NLP market around the world.

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The on-premises segment is expected to grow at a higher CAGR over the forecast period

The NLP market by deployment mode is segmented into on-premises and cloud. Companies choose the deployment mode based on their requirements regarding the required scalability and the required level of data security. The on-premises model is most preferred among the enterprises, who view data as a valuable asset and must maintain a high level of security to comply with regulations. Deploying NLP solutions on-premises provides organizations with significant improvements in data validation, standardization, and robust matching, as is done locally with monitoring.

The SMB segment is growing at a higher CAGR over the forecast period

Based on organization size, the NLP market is segmented into SMEs and large enterprises. The SMB segment is expected to grow at a higher CAGR over the forecast period. The adoption of chatbots, IVR and messaging apps in SMBs is increasing globally with an increasing focus on delivering enhanced customer service. SMEs are at an early stage in NLP adoption with most small businesses experimenting in the exploratory phase, but they are starting to show more interest in getting an analytics platform to get the desired results.

Statistical type segment is expected to have the largest market size during the forecast period

The type of NLP solutions is divided into rule-based, statistical and hybrid. NLP is gaining popularity and has become possible due to the availability of a large amount of data. The technique extracts meaningful insights from structured data. The advantages of the statistical method, such as better speed, robustness and reliability, are expected to drive the adoption of NLP solutions and services in the market. Statistical NLP is one of the better approaches to generate results when dealing with a large amount of data. Due to the vast amount of text and speech corpora available online, statistical NLP has shown remarkable success in recent decades.

Among the verticals, the healthcare and life sciences segment is growing at the highest CAGR . during the forecast period

The NLP market is segmented into the various verticals, specifically BFSI, IT & Telecom, Retail & E-Commerce, Healthcare & Life Sciences, Transportation & Logistics, Government & Public Sector, Energy & Utilities, Manufacturing, Other (Education, Travel and hospitality, and media and entertainment). The healthcare and life sciences vertical is projected to grow at the highest CAGR during the forecast period. The industry’s rapid growth rate can be attributed to the increasing complexity of healthcare and the growing need for advanced NLP-driven EHRs to extract meaningful insights from unstructured clinical data. NLP solutions help improve patient experiences and quality of care through effective clinical decision support and streamlined medical policy assessment, achieving the goal of creating medical value.

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North America has the largest market size during the forecast period

The natural language processing market is segmented into five regions: North America, Europe, APAC, MEA, and Latin America. Of these regions, North America is expected to have the largest market size during the forecast period. Improvements in cloud computing platforms, which are now more efficient, affordable and capable of processing complex information, have led to the growth of low-cost software development tools and abundant data sets, which play a vital role in the development of AI technology in the US market. APAC is expected to grow at the highest CAGR during the forecast period due to increasing awareness and increasing AI investment.

Major suppliers in NLP are IBM (US), Microsoft (US), Google (US), AWS (US), Facebook (US), Apple (US), 3M (US), Intel (US), SAS Institute (US ), Baidu (China), Inbenta (US), Veritone (US), Dolbey (US), Narrative Science (US), Bitext (Spain), Health Fidelity (US), Linguamatics (UK), Conversica (US), SparkCognition (US), Automated Insights (US), Gnani.ai (India), Niki (India), Mihup (India), Observe.AI (US), Hyro (US), Just AI (England), RaGaVera (India). These NLP providers have adopted various organic and inorganic strategies to maintain their positions and increase their market shares in the global NLP market.

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