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Natural Language Understanding Market Trends

Report ID: GMI11898
Published Date: Oct 2024
Report Format: PDF

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Natural Language Understanding Market Trends

The increasing demand for advanced text analysis solutions is significantly driving the natural market. Companies are introducing innovative NLP solutions to enhance the efficiency and effectiveness of data management. For instance, in March 2023, Kensho Technologies unveiled its latest Natural Language Processing (NLP) solution called Kensho Classify. Kensho Classify unlocks the value of large volumes of text and documents by making content more discoverable, facilitating smart search, content recommendations, and streamlining research and analysis.

The pandemic has accelerated the adoption of NLU-powered chatbots and virtual assistants across various sectors, including healthcare, e-commerce, and customer service. This trend is expected to continue, driving demand for advanced solutions that can handle complex queries and provide more human-like interactions.

An emerging opportunity in the NLU market lies in the integration of NLU with Robotic Process Automation (RPA) for automating complex, knowledge-based tasks. For instance, in July 2024, Digital Workforce announced a partnership with Sema4.ai to integrate AI Agents into its Outsmart business process automation platform, combining RPA with the adaptability of Large Language Models (LLMs).

The natural language understanding (NLU) market faces challenges such as the complexity in understanding context and nuances in human language, as well as data privacy and security concerns. Many organizations are hesitant to adopt NLU solutions due to the potential risks associated with processing sensitive information. Additionally, the lack of skilled professionals in NLU technologies poses a significant challenge for companies looking to implement and maintain these advanced systems.

Authors: Preeti Wadhwani, Satyam Jaiswal

Frequently Asked Questions (FAQ) :

The market size of natural language understanding reached USD 19.3 billion in 2023 and is set to grow at a 20.1% CAGR from 2024 to 2032, driven by the increasing adoption of AI-powered solutions across various industries.

The solution segment was valued at over USD 16 billion in 2023, due to the increasing demand for NLU-powered applications such as chatbots, virtual assistants, and text analytics tools.

The cloud-based NLU segment is anticipated to register a CAGR of over 18% from 2024 to 2032, propelled by the rapid adoption of cloud computing and the need for scalable, flexible NLU solutions.

The North America market recorded a major share of over 35% in 2023, led by significant growth in the U.S. due to the presence of major technology companies and a robust startup ecosystem.