PUBLISHER: MarketsandMarkets | PRODUCT CODE: 1516914
PUBLISHER: MarketsandMarkets | PRODUCT CODE: 1516914
The global natural language understanding (NLU) market is valued at USD 19.2 billion in 2024 and is estimated to reach USD 62.9 billion in 2029, registering a CAGR of 26.8% during the forecast period. The evolution of consumer expectations towards personalized and sophisticated interactions has significantly shaped the market demand for Natural Language Understanding (NLU) tools. This shift is evident in the fact that approximately 20% of Google searches are conducted via voice, highlighting the growing preference for intuitive and conversational interfaces. Businesses that fail to integrate NLU tools into their operations risk constraining the level of customer experience they can offer. NLU empowers organizations to understand and respond to the nuances of individual customer inputs, whether through voice commands, text-based queries, or social media interactions.
Scope of the Report | |
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Years Considered for the Study | 2019-2029 |
Base Year | 2023 |
Forecast Period | 2024-2029 |
Units Considered | USD (Billion) |
Segments | Offering, Solutions by Deployment Mode and Services, Type, Application and Verticals |
Regions covered | North America, Europe, Asia Pacific, Middle East & Africa, Latin America |
"By offering, the solution segment is projected to hold the largest market size during the forecast period."
The solution segment, comprising platforms and software tools & frameworks, offers comprehensive offerings and versatility. NLU platforms offer end-to-end solutions that encompass data preprocessing, model training, deployment, and analytics. This makes them highly suitable for businesses seeking integrated and scalable NLU capabilities. These platforms often come equipped with pre-built models and APIs, which expedite development and facilitate the rapid deployment of NLU applications across various domains. On the other hand, software tools & frameworks offer developers the flexibility to create customized NLU solutions that cater to specific use cases and requirements. They provide a wide range of features, including natural language processing (NLP) libraries, sentiment analysis tools, and speech recognition capabilities, empowering developers to develop innovative NLU applications.
"By type, hybrid segment is registered to grow at the highest CAGR during the forecast period."
Hybrid NLU, which combines statistical and rule-based approaches, is growing rapidly in the NLU market due to its ability to combine the strengths of both approaches. Rule-based NLU relies on predefined rules and models to interpret language, providing accuracy but limited adaptability to new data and contexts. In contrast, statistical NLU utilizes machine learning algorithms to learn patterns and relationships from data, providing flexibility but requiring significant quantities of labeled data for training. Hybrid NLU utilizes rule-based logic to interpret structured data with statistical models to handle unstructured and nuanced language input. This combination approach improves accuracy, scalability, and adaptability, making it suitable for complex use cases such as virtual assistants, sentiment analysis, and conversational AI.
"Asia Pacific is projected to witness the highest CAGR during the forecast period."
The Asia Pacific region is currently undergoing rapid expansion and is emerging as the most rapidly growing market in the natural language understanding (NLU) sector. This growth is being fueled by various factors, such as the increasing utilization of AI and machine learning technologies in industries like healthcare, finance, retail, and customer service. Countries like China, India, Japan, and South Korea are observing substantial investments in NLU research and development, resulting in the creation of sophisticated language processing capabilities customized for regional languages and dialects. Furthermore, the growing need for personalized customer experiences, effective communication platforms, and automation in businesses is propelling the adoption of NLU solutions in the Asia Pacific region.
Breakdown of primaries
In-depth interviews were conducted with Chief Executive Officers (CEOs), innovation and technology directors, system integrators, and executives from various key organizations operating in the NLU market.
Major vendors offering NLU solutions and services across the globe are Microsoft (US), Google (US), IBM (US), AWS (US), Meta (US), SAS Institute, Oracle (US), Salesforce (US), OpenAI (US), SoundHound AI (US), IQVIA (US), LivePerson (US), Haptik (India), Kapiche (Australia), Rasa (US), MindMeld (US), Hugging Face (US), Conversica (US), Expert.ai (Italy), Verbio Technologies (Spain), Wolfram (US), Cortical.io (Austria), Omilia (Cyprus), Cognigy (Germany), Plasticity (US), Afforai (US), Tune AI (US), Vebrit.ai (US), Synthesys (UK), Picovoice (Canada), Symbl.ai (US), Tisane Labs (Singapore), Prosa.ai (Indonesia), Abacus.AI (US), Forethought (US).
Research Coverage
The market study covers natural language understanding (NLU) across segments. It aims at estimating the market size and the growth potential across different segments, such as offering (solutions [platform and software tools & frameowrks], solutions by deployment mode, and services), type, application, vertical and region. It includes an in-depth competitive analysis of the key players in the market, along with their company profiles, key observations related to product and business offerings, recent developments, and key market strategies.
Key Benefits of Buying the Report
The report would provide the market leaders/new entrants in this market with information on the closest approximations of the revenue numbers for the overall market for NLU and its subsegments. It would help stakeholders understand the competitive landscape and gain more insights better to position their business and plan suitable go-to-market strategies. It also helps stakeholders understand the pulse of the market and provides them with information on key market drivers, restraints, challenges, and opportunities.