ResearchFox conducted research on the Natural Language Processing (NLP) market from 2014-2019. They used secondary research methods like analyzing previous reports and primary research methods like interviews with NLP providers, customers and experts. The research methodology included defining the scope, sampling relevant organizations, designing questionnaires, validating responses and analyzing the data. The goal was to understand market segments, trends, size, growth opportunities and challenges to forecast the future of the NLP industry.

1. NLP Market - Outlook (2015-19)
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3. Table
of Contents
1. Introduction
1.1. Report Description
1.2. Objective
1.3. Scope of the Research
1.4. Regions Covered
1.5. Key Takeaways
1.6. Key Stakeholders
1.7. Key Terminologies
1.8. List of Abbreviations
2. Executive Summary
2.1. Executive Overview
3. Research and Forecasting
3.1. Research Methodology
3.2. Forecasting Methodology
4. Industry Landscape
4.1. Market Size and Growth
4.2. Competitive Landscape
4.3. Market Share
4.4. Company Classification
4.5. Region Outlook
4.6. Market Metrics
4.7. Porter's Five Forces Model
4.8. Key Drivers Analysis
4.9. Key Constraints Analysis
4.10. Key Opportunities Identified
4.11. Key Challenges Identified
5. Market Segmentation
5.1. Industry
5.1.1. Information Technology
5.1.1.1. Market Size and Forecasting
5.1.1.2. Key Drivers Analysis
5.1.1.3. Key Constraints Analysis
5.1.1.4. Key Opportunities Identified
5.1.1.5. Key Challenges Identified
5.1.1.6. Sub Segments
5.1.1.6.1. Region : North America
5.1.1.6.2. Region : Europe
5.1.1.6.3. Region : APAC
5.1.1.6.4. Region : ROW
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Introduction 01 4

5. 1. Introduction
1.1. Report Description
With growing usage of computers, Internet, smartphones and other personal devices, the need for human
and machine level interaction has increased. Businesses to individual users now want machines that
respond to their queries, assist them in their day-to-day operations and all-in-all make their life easier and
organized. This has given rise to increased demand for technologies like Natural Language Processing (NLP)
which is now being rapidly commercialized. NLP, which was earlier a topic of research for various
educational and research organizations is now growing to be a commercial product.
Additionally, there is growing technology advancement in smartphones, biometrics and social media which
has forced the organizations to bring the enhanced customer service experience which in-turn is driving the
demand for NLP based solutions. Language processing tools that were developed earlier concentrated only
on few languages and were used largely in developed countries. However, with growing computing
capabilities and businesses going global, the need for multi-lingual language processing tools is growing
and this has paved way to development of new and advanced version of Natural Language Processing tools.
This report presents interpretative and easy-to-understand facts on how the current NLP market is
segmented based on end-user, verticals, application types, technology, solution type and geographies. It
cuts through several facets of the NLP market such as market size, market share for each segment, the
drivers and constraints of Natural Language Processing marketplace. It also throws light on various verticals
where NLP is being rigorously implemented and the NLP applications that are most sought after. Report
also provides information on the challenges and opportunities that lie ahead for these solutions.
1.2. Objective
1. To understand the NLP market across the globe by addressing the challenges faced by the industry with
regards to the adoption of NLP.
2. To estimate the size of present global NLP market and to forecast its future values.
1.3. Scope of the Research
Scope of the research was limited to understanding the market share across segments. Key drivers,
constraints and challenges along with their impact on various business functions in both short term and
long term were addressed. Segmentations and forecasting were done based on:
1. End user
2. Applications
3. Verticals
4. Solution type
5. Technology
6. Region based segmentation
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6. 1.4. Regions Covered
1. North America (US, Canada and Mexico).
2. Europe (United Kingdom, France, Germany, Italy, Spain).
3. APAC (Australia, India, China, Japan, Singapore, and others).
4.
1.5. Key Takeaways
The research conducted to understand NLP markets in different regions of the globe have revealed some
valuable insights. Some of the key take away points involve information given below:
1. North America has the highest market share whereas Europe is growing at a good pace.
2. The market share of NLP is over USD 2489.71 million in 2014 and growing at an impressive CAGR of over
20%.
3. Adoption of NLP is more among enterprises who generate large amounts of data and seek data that helps
them in relevant decision making.
4. Preference towards Statistical based NLP is increasing as businesses look for some kind of numbers and
insights which help them to draw conclusions.
5. High implemenatation costs and complexities are the major constraints that hold back small and mid-
size companies from adopting these solutions.
6. NLP based applications like machine translation, information extraction and report generation are the
most popular applications among the users.
1.6. Key Stakeholders
1. NLP service providers: NLP service providers will be able to gauge the market more accurately as this will
assist them in better decision making.
2. NLP product development companies: NLP product developers will be able to assess the end-user market
mood and accordingly develop products as per the changing requirements of customers.
3. End-User companies: Report will provide the end-users, a more clear picture on the service provider
demographics so that they can choose among the best.
4. Global Investors: Those investors who look to fund new and budding NLP startups will get clearer picture
about the market and its trends.
5. Industry Watchers: Industry and trend watchers are always referred to as trusted advisors who follow
markets. The report would add to their knowledge repository, creating value for their know-how.
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7. 1.7. Key Terminologies
1. NLP (Natural Language Processing): Natural language processing is the ability of a computer to
understand human language.
2. Enterprise: Companies with an employee headcount above 1001
3. Mid-Size: Companies with an employee headcount between 501 and 1000
4. Small Business: Companies with an employee upto 500
5. Analytics: Analytics is defined as the scientific process of transforming data into insight for making better
decisions.
6. Text Analytics: Text analytics leverages and learns from massive quantities of textual data to reveal
customer intentions and sentiment.
7. Semantic Analysis: Analyzing, searching, and presenting information using explicit semantic relationships
between known entities.
8. Sentiment Analysis: Sentiment analysis is the analysis of the feelings (i.e. attitudes, emotions and
opinions) behind the words using natural language processing tools.
9. Big Data: Big data describes any voluminous amount of structured, semi-structured and unstructured
data that has the potential to be mined for information.
10. North America: North America includes the countries - USA (United States of America), Canada and
Mexico
11. Europe: Europe includes countries - UK (United Kingdom), France, Italy, Germany and Spain.
12. APAC (Asia Pacific): Asia Pacific includes countries - India, China, Japan, Philippines, and Australia.
13. Rest of World: Rest of World includes South Africa, Middle East Asia - UAE (United Arab Emirates), South
America (Brazil and Argentina), Israel etc.
14. Virtual Assistants: A digital application which delivers personalized effortless customer service via a
human-like conversational interface.
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8. 1.8. List of Abbreviations
1. APAC: Asia Pacific
2. API: Application Program Interface
3. B2B: Business-to-business
4. B2C: Business-to-consumer
5. CACS: Computer Assisted Coding Systems
6. CAGR: Compounded Annual Growth Rate
7. CRM: Customer Relationship Management
8. ERP: Enterprise Resource Planning
9. ICD: International Classification of Diseases
10. IT: Information Technology
11. ITES:Information Technology Enabled Services
12. IVR: Interactive Voice Response
13. NLP: Natural Language Processing
14. NLU: Natural Language Understanding
15. OCR: Optical Character Recognition
16. OEM: Original Equipment Manufacturer
17. PR: Public Relations
18. SaaS: Software-as-a-Service
19. UK: United Kingdom
20. USA: United States of America
21. USD: United States Dollars
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Executive Summary 02 9

10. 2. Executive Summary
2.1. Executive Overview
Technology has always turned out to be a facilitator to human beings making their work simpler and
effective. Data explosion across all the industries and the need for structuring of this kind of data has given
rise to commercial applications of technologies like Natural Language Processing. In simple terms, natural
language processing is a part of artificial intelligence that enables interactions between computer and
human languages.
With increase in big data and businesses transforming themselves to become social media centric
organizations, the need for quick processing tools that can gauge the customer responses and present them
in some kind of actionable manner is fast becoming the need of the hour. Also, increased use of internet via
smartphones is bringing loads of data into the social platform and businesses are seeing natural language
processing tools as a means to organize data from the repository.
Till recently, Natural language processing was a research oriented topic and was not intensively
commercialized. But, with recent developments, NLP is fast gaining commercial importance with large
enterprises like IBM, Microsoft, HP and others starting to provide NLP solutions. In 2014, global NLP market
reached USD 2.4 billion and the growth is expected to continue with a healthy pace.
North America rules NLP
North America, especially USA, is the major source of revenue for natural language processing. This region
houses most NLP providers of the world and consists of more end-users. The market here is mature enough
and as always, has been the leader in terms of acceptance of this technology. Most of research activities
related to natural language processing have been initiated and implemented on these grounds and thereby
forms the breeding ground for natural language processing. Among other regions, APAC stands promising
market for the technology with growing customer priority.
Enterprises are the major customers
Natural language processing involves complexities in implementation and as the costs involved are also
high, NLP solution mainly finds its prominence among large enterprises. Large enterprises cannot manage
high volumes of unstructured data generated and in order to structure these sets of data, they seek natural
language processing systems. Going forward, with growth of cloud, even mid-size companies are also
expected to adopt NLP solutions more aggressively.
Healthcare and Publishing houses embrace NLP
Healthcare industry observes larger use of NLP solutions and this market consists of NLP providers like
Nuance, 3M who dedicatedly serve this industry. Due to the nature of healthcare industry which uses
standard phrases and medical terms, it becomes extremely difficult to understand the patient behavior and
hence to attain greater accuracy within minimum time when dealing with patients, NLP finds its way into
the healthcare industry. Also, the publishing and media houses are the front-runners in adoption of natural
language processing solutions as this industry deals with data which needs to be propagated in real time.
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11. Awareness about natural language processing is still at its nascent stage and has limited acceptance all over
the world. Similarly, the complexities and costs involved in developing and implementation of NLP based
solutions is high which restricts entry of new companies into the provider market and also deters end-users
from adopting these solutions.
With growing importance of data, improved research related to NLP and development of advanced cost
effective NLP solutions, businesses are expected to adopt NLP solutions at a higher rate in the future.
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Research and Forecasting 03 12

13. 3.1. Research Methodology
Base Year: 2014
Forecasting Period: 2015 - 2019
3.1.1. Sampling
The leading suppliers of each end-user product categories that were chosen to provide a larger
representative sample.
Purposive unit sampling was adopted for every service segment such as verticals, regions, end-users and
others. This was resorted to, in order to elicit the appropriate inputs with regard to the qualitative growth
aspects of the market.
3.1.2. Secondary Research
The research methodology that was carried out was desk research through various journals, association
reports, and in house database to build a knowledge base on various market service segments, product
categories and industry trends.
Various fact based data was analyzed. Some of the sources included:
a. ResearchFox Knowledge Base:
Previous data on the market has been put through a rigorous and comprehensive analysis to analyze
the current state.
b. Desk Research:
Industry reports, annual reports, press releases, webinars, journals and publication, independent rating
agencies and government statistics.
3.1.3. Primary Research
Primary interviews were conducted among various stakeholders:
Product and service companies
Members of associations and alliances
Subject Matter Experts and Evangelists
Consultants and Strategists
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14. 3.1.4. Industry Information
It was essential to understand the current industry landscape, market dynamics, security ecosystem and
competitor metrics. To estimate the global market, Chief Experience Officers (CXOs), Marketing Heads, Sales
Managers and product stakeholders were interviewed.
3.1.5. Technical Information
In addition to the interviews with leading participants for industry-related information, ResearchFox
conducted interviews with Research and Development (R&D) and Design and Development teams to
understand the current usage of the products by service type and also to find out the emerging trends.
Finally, interviews with suppliers were conducted to cross check the validity of information and also to
understand the emerging trends in the end-user segment.
The detailed methodology for primary research is outlined below.
3.1.6. Primary Interview Questionnaire Design
ResearchFox developed a detailed questionnaire, which was used by the analysts as a guide for their
discussions. This process ensured the collection of all necessary data. The questionnaire was designed to
elicit unbiased industry level data (market size, production, sales, and others), that had check points
(questions such as company level information and their position in the industry acted as check points) to
ensure accuracy of the data. The questionnaire included the following sections:
1. Industry level information
2. Characteristics and Dynamics
3. Company-specific information
4. Market segmentation data
3.1.7. Interview Questionnaire Test and Validation
Following the design of the questionnaire, ResearchFox carried out some initial interviews to verify that the
appropriate market and technology data was generated. After the final design of the questionnaire,
ResearchFox began full scale primary research. Specific companies targeted for primary research interviews
were selected based upon market participation. Higher was the entity's profile, more attractive was the
entity.
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15. 3.1.8. Interview Process
As participants respond in the course of an interview, ResearchFox analysts are trained to move from lower
priority and/ or sensitive topics to increasingly key and/or sensitive topics in response to the interviewee's
behavior. This responsive and reflective interview process, combined with the analysts' ability to discuss the
industry and technical issues in an open and sharing environment, allows ResearchFox to probe for key
data, operations, and competitive information. Multiple contacts within a single organization and with an
individual are often planned and/or staged in order to optimize and complete the information gathering
process.
3.1.9. Research Validation
At a point, when 20 percent of the research interviews and/or data collection had been completed,
ResearchFox consultants evaluated the preliminary findings to assure that up-to-date results are in line with
project objectives. The analyst team analyzed the information from the interviews and information was
validated through a combination of the following validation techniques:
Cross checking with other primary data and previously developed in-house research
Review of secondary information, such as trade journals, annual reports and industry directories
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16. 3.2. Forecasting Methodology
3.2.1. Step-by-Step Methodology for Market Estimation and Forecasting
Market Estimation and Forecast Methodology, 2015
Step Method
1
Understand the market mechanism for the market through structured, systematic and theoretically established
norms of analyzing, designing, introducing and quality assurance of the market estimation
2 Measuring the various market drivers, constraints, opportunities and challenges at regular intervals of time
3 Integrate expert-opinion of discussions in consultation with the ResearchFox Analyst team
4 Market estimation and forecast calculation
5 Delphi method and Causal Analysis used as and when required
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Rigorous quality check with heads of Research Team, Subject Matter Experts and Consultants before final
publication
Source: ResearchFox
Significance and Importance of the Market Forecast, 2015
Sr. No. Significance and Importance
1 Helps revisit on the company's R&D investments
2 Keeps the Sales and Marketing team posted on the market prospects
3 Strategize investment and expansion plans
4 Improve business planning
5 Helps create business aims and set sales figures within the company
6 Aware of the current market competition
7 Support plans for Merger and Acquisition (M&A)
Source: ResearchFox
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