Data Annotation Tools Market - Industry Dynamics, Market Size, And Opportunity Forecast To 2030

Global Data Annotation Tools Market is estimated to witness a major jump in revenue from US$ 1,186.9 Mn in 2021 to US$ 13,287.9 Mn by 2030. The market is registering a CAGR of 30.9% over the projection period 2022-2030. A data annotation tool is a software solution that may be used to annotate production-grade training data for machine learning. In situations wherein unlabeled data is available in large volumes, these data annotation tools are most suitable to use and will also create new opportunities for market expansion. It can be cloud-based, on-premise, or containerized. 

The rising need for annotated data to better machine learning models and enhance the application of AI in the healthcare sector, as well as greater investments in autonomous driving technology upgrades are projected to help the industry. Demand for data annotation tools is expected to soar in the coming decade, as an increasing number of firms use big data analytics to speed up data collecting and assimilation processes. Also, data annotation is making inroads in the healthcare field, supporting doctors with diagnosis, locating disease causes, recommending alternative treatment options, performing surgery, and forecasting whether the sickness is life-threatening.

• Application of Data Annotation Tools in Service Sector

AI in the manufacturing sector is mostly applied in the areas of industrial Internet, defect detection, intelligent handling, random sorting, network security, and robotics. The application is related to vehicle energy, electric power, pharmaceuticals, heavy metal, and so on. AI automation technology can assist industrial robot applications not only to be more powerful, but it can also help cut costs and enhance efficiency, dependability, and safety as data plays a crucial function in artificial intelligence systems.

• Performance of Data Annotation Tools in Service Sector

Factors such as flexibility and customer service as the high-quality standard, data security, and scalability are the most significant measurements in data annotation service. In machine learning, engineers uncover new options for improving model performance with each round of testing, therefore the workflow is continually changing. Data annotation is fraught with ambiguity and variation. The growing usage of manual data annotation tools to ensure high-quality input data is predicted to be a major factor in the Data Annotation Tools Market's growth.

Market Dynamics

Rising demand for annotated data to improve machine learning models and increasing investment in R&D for the development of advanced technology in the medical industry is expected to boost the data annotation tools market growth. With the rising globalization and urbanization, industries are adopting better technologies to function. The increasing necessity of high-quality, well-labeled input data for improving the accuracy of machine learning algorithms is expected to propel the sector forward. Moreover, AI in healthcare is proving to be useful to both patients and healthcare providers by increasing efficiency and lowering costs. With the use of data annotation services that improve data annotation for the healthcare sector, all medical, laboratory administrative, financial and other data must be prepared and evaluated to make better results. However, data privacy compliance and workforce management restrict the deployment of data annotation tools and thus inhibit the market growth. 

Key Insights of the Report: 

• The latest study published by Astute Analytica analyses the Global Data Annotation Tools Market for the study period of 2021-2030; where the base year is 2021 and the forecast period is 2022-2030.
• The research report offers a detailed study of market determinants including market drivers, restraints, opportunities, and trends; along with an attractive presentation in the form of impact analysis to gain a simpler and easy comparison view of all market determinants.
• The research study is a compilation of 15 chapters distributed across 198 pages with 38 lists of tables and 105 lists of figures.
• The market estimates are presented in terms of value (US$ Mn).
• Along with market estimations, the market study was conducted on the basis of various economic models such as PESTLE and Porter’s five force models.
• Detailed value chain analysis of the industry was conducted. It includes datasets, data annotation tools, technology integration, and end-users.
• The competitive dashboard section includes analysis on the basis of the Concentration Ratio (CR), based on market size and market presence of key companies.

Impact of COVID-19 on Global Data Annotation Tools Market

The outbreak of COVID-19 contributed significantly to the growth of the worldwide data annotation tools market. During the COVID period, demand for data annotation tools is expected to rise due to the increased use of artificial intelligence and machine learning solutions. A surge in the usage of text annotation for document classification has also been identified as a key factor driving the market during the pandemic's onset. The coronavirus pandemic is expected to force healthcare and pharmaceutical companies to invest more in artificial intelligence research. Developments in artificial intelligence augmented reality and virtual reality will continue to be critical in sustaining industry growth despite the pandemic's difficulties. Moreover, artificial intelligence and machine learning are likely to be used extensively in the healthcare sector to develop new technology to combat viruses as severe as the corona.

Key Takeaways from the Global Data Annotation Tools Market Report

• Based on data type, the text segment accounted to hold the highest share in 2021 as it includes text and time series and a label.  It can be done for language-to-language translation, to convert a complete text into a summary, and to accomplish other tasks. However, the video segment is expected to increase at the highest CAGR during the forecast period.
• On the basis of technology, the automatic segment is projected to grow at the highest CAGR over the forecast period. Deploying automation in the annotation process frees up resources for rigorous and more focused quality checks and enables retraining - more data means better-trained algorithms. Moreover, the supervised segment accounted to hold the highest share in 2021 in the global data annotation tools market.
• In terms of device type, data annotation in windows grips the market in 2021 as there are several users of windows owing to its cheap pricing and a huge user base in the marketplace. Whereas, owing to exclusive features the Mac segment is expected to grow at a faster CAGR during the forecast period.
• Based on end-users, the Telecommunication and IT segment hold the highest market share in 2021 in the global data annotation tools market. The healthcare segment has the highest CAGR over the forecast period as it uses AI incorporated with data annotation tools for numerous applications such as drug development, gene sequencing, treatment prediction, and diagnostic automation.
• The Asia Pacific holds the highest market share during the forecast period as data annotation service providers in China are offering innovative data labeling services & annotated healthcare training data validated by medical experts to strengthen their market presence and add value to their offerings.  Japan Data Annotation Tools Market is estimated to make a major leap forward in its revenue from US$ 73.6 Mn in 2021 to US$ 1,363.8 Mn by 2030.

Competitive Insight

The key players in the Global Data Annotation Tools Market are Annotate.com, Appen Limited, Cloud Factory Limited, CloudApp, Google LLC, Labelbox, Inc., Deep Systems, LightTag, Lionbridge Technologies Inc., Cogito Tech LLC, and Lotus Quality Assurance among others. Through extensive research, it is found that big players have adopted various competitive strategies such as mergers & acquisitions in order to have a grip on emerging markets. Furthermore, leading companies are expanding their geographical boundaries by acquiring small brands and domestic companies.

Segmentation Overview 

Global Data Annotation Tools Market is segmented based on data type, technology, device type, end-users, and region. The industry trends in the global data annotation tools market are sub-divided into different categories in order to get a holistic view of the global marketplace. 

Following are the different segments of the Global Data Annotation Tools Market:

By Data Type Segment of the Global Data Annotation Tools Market is Sub-Segmented into:

• Text
  • Sentiment
  • Text Classification
  • Entity
• Image
  • Boundary Boxes
  • Line Annotation
  • Image Transcription
• Video 
  • Semantic
  • Polygon
  • Key point
• Audio
  • Voice Activity Detection (VAD)
  • Speaker Identification
  • Automated Speech Recognition

By Technology Segment of the Global Data Annotation Tools Market is Sub-Segmented into:

• Supervised
• Semi-Supervised
• Automatic

By Device Type Segment of the Global Data Annotation Tools Market is Sub-Segmented into:

• Mac OS
• Windows
• Linux
• Others

By End Users Segment of the Global Data Annotation Tools Market is Sub-Segmented into:

• Automotive
• Healthcare
• Retail
• Transportation and logistics
• BFSI
• Telecommunication and IT
• Others

By Region Type Segment of the Global Data Annotation Tools Market is Sub-Segmented into:

• North America
  • The U.S.
  • Canada
  • Mexico
• Europe 
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Poland
  • Russia
  • Rest of Europe
• Asia Pacific 
  • China
  • India
  • Japan
  • Australia & New Zealand
  • ASEAN
  • Rest of Asia Pacific
• Middle East & Africa (MEA)
  • UAE
  • Saudi Arabia
  • South Africa
  • Rest of MEA
• South America
  • Argentina
  • Brazil
  • Rest of South America