The global data annotation tools market size was valued at USD 629.5 million in 2021 and is expected to expand at a CAGR of 26.6% from 2022 to 2030. A data annotation tool is a cloud-based, on premise, or containerized software-based platform used to interpret and evaluate machine learning training software. In addition, these tools are curated to be used with explicit data sets such as spreadsheets, image text, and video.
Data annotation tools allow users to add attribute tags to data and improve the value of the information. It eliminates the need to manage duplicate data at multiple locations. The increasing volume of data is aiding the adoption of artificial intelligence and machine learning technologies. This will propel the market demand in the forthcoming years. The market is predominantly driven by the rising adoption of machine learning and artificial intelligence solutions in end-use industries such as retail, automotive, and healthcare.
The applications of AI in the healthcare industry are on the rise and will play a vital role in market growth. AI-backed machines use computer vision or machine vision and simplify the diagnosis process. MRI, CT scans, and X-Ray datasets are easily scanned for injuries and tumors with AI-based data annotation software solutions. Innodata Inc. in March 2021 announced the expansion of its AI capabilities to include medical reports. The data annotation platform created by Innodata will combine its capabilities from the Synodex medical data extraction platform with the AI data annotation tools to high-quality AI training data, compatible with HIPAA and other security guidelines.
Massive amounts of data are produced by technologies like the Internet of Things (IoT), Machine Learning (ML), robotics, advanced predictive analytics, and Artificial Intelligence (AI). Data efficiency is crucial for developing new business ideas, infrastructure, and economics. These elements have considerably aided the industry's expansion. Companies creating AI-enabled healthcare applications are working with data annotation companies to provide the necessary data sets that can help them improve their machine learning and deep learning capabilities. This collaboration is taking place in response to the growing potential for growth in data labeling. For instance, Telus International, a provider of digital customer experience (CX) and digital IT solutions & services, said in November 2020 that it would purchase Lionbridge AI, a provider of training data and annotation platform solutions. This merger is aimed at designing AI algorithms to power machine learning.
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