The global data annotation tools market size is expected to reach USD 1.6 billion by 2025, according to a new study by Grand View Research, Inc., registering a 26.6% CAGR over the course of the forecast period. Data annotation refers to the process of labeling and tagging all forms of data, images, text, video, audio, and others, to make it usable for machine learning.
The advent of big data is expected to drive the growth of the artificial intelligence (AI) market as a large volume of data is required to be recorded, stored, and analyzed. Adoption of AI is expected to significantly boost demand for labeling all formats of information as annotated data acts as a catalyzer to train AI models and machine learning systems in critical areas such as speech recognition and image recognition. The process offers AI its strength by directly providing information that is relevant to determining future outcomes and decision-making.
Currently, there is a growing trend of manufacturing autonomous vehicles in the automotive industry, which is attracting larger investments for their development. An autonomous vehicle includes a combination of various sensors and networking systems that assist computers in driving the vehicle. Information that has been annotated allows the computer models to recognize and learn from it. Several technology providers such as Google Inc.; Tesla Motors; Apple Inc.; and Huawei Technologies Co., Ltd. have also entered the autonomous vehicle market. This, supported by rising investments in the self-driving market, are expected to drive demand for information labeling and tagging solutions.
Rising innovations in the retail segment, specifically in improving the E-commerce sector, have upped the use of such tools and this is expected to drive the data annotation tools market over the forecast period. For instance, in 2019, Walmart Labs acquired Dataturks, an India-based data annotation start-up. Dataturks offers annotation tools for image and text by using machine learning. The acquisition helped drive innovations in catalogue quality and other aspects of the Walmart merchandising platform.
The data annotation tools market shows promising growth prospects throughout the forecast period, owing to the combination of numerous factors such as increasing investments and mergers and acquisitions by data-driven companies. For instance, in June 2017, Figure Eight Inc. received funds worth USD 20 million through a venture round with Industry Ventures as a lead investor among six investors.
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Further key findings from the report suggest:
Rising technological advancements in the automotive sector, specifically in the development of self-driving cars, is expected to fuel the growth of image data annotation tools over the forecast period
North America dominated the global market in 2018 and accounted for over 38.0% of the overall revenue
To gain a competitive edge, companies have started adopting client-base expansion as a key strategy by raising funds for the development of data annotation platforms. For instance, Hive, a data labeling platform provider, raised funds worth USD 30 million in venture capital from PayPal founder Peter Thiel’s Founders Fund and others in November 2018
Key players in the global market include Annotate.com; Appen Limited; CloudApp; Cogito Tech LLC; Deep Systems; Labelbox, Inc.; LightTag; Lotus Quality Assurance; Playment Inc.; Tagtog Sp. z o.o.; CloudFactory Limited; Clickworker GmbH; Alegion; Figure Eight Inc.; Amazon Mechanical Turk, Inc.; Explosion AI, Mighty AI, Inc.; Trilldata Technologies Pvt. Ltd. (Data Turks); Scale, Inc.; and Google, LLC.
Grand View Research has segmented the global data annotation tools market based on type, annotation type, vertical, and region:
Data Annotation Tools Type Outlook (Revenue, USD Million, 2014 - 2025)
Data Annotation Tools Annotation Type Outlook (Revenue, USD Million, 2014 - 2025)
Data Annotation Tools Vertical Outlook (Revenue, USD Million, 2014 - 2025)
Data Annotation Tools Regional Outlook (Revenue, USD Million, 2014 - 2025)
Middle East and Africa
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