Automatic Speech Recognition Software Market Trends [2031]

Report Description

Automatic Speech Recognition Software Market Outlook

The global automatic speech recognition software market size was USD XX Billion in 2022 and is likely to reach USD XX Billion by 2031, expanding at a CAGR of XX % during 2023–2031. The market growth is attributed to the increasing adoption of smart security devices and rising demand for IoT devices.

Rising demand for IoT devices is expected to drive the market. Automatic speech recognition software is utilized in IoT devices to control devices through speech or voice commands. It enhances the user experience, as it enables users to respond to a text without looking or touching their devices. Thus, increasing adoption of IoT devices is propelling the market. For instance,

• As per a report, 15.14 billion IoT-connected devices are available worldwide and are estimated to reach 29.42 billion by 2030.

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Automatic speech recognition software enables the processing and detection of human voices. It allows the user to authenticate the identity of the individual speaking to the device by recognizing an individual's voice. This software is primarily used in healthcare, military, IT & telecommunication, automobile, manufacturing, BFSI, government, and others. Automatic speech recognition software is available in two types, namely, directed or guided dialogue conversations and natural language conversations.

Increasing adoption of smart security devices is projected to boost the demand for automatic speech recognition software. Smart security devices such as voice-activated door locks or biometrics are installed with automatic speech recognition software to recognize and validate speech from a specific individual or group. 

The COVID-19 pandemic propelled the demand for automatic speech recognition software. Stringent government guidelines such as lockdowns and social distancing drove significant changes in the desires of people to meet new functional requirements, such as working and learning at home and finding new ways to relax and enjoy, which encouraged people to adopt smart devices such as smart speakers, automated lighting, and others.

This boosted the demand for automatic recognition software, as this software is installed in smart speakers and automated lighting to allow users to control devices through voice or speech.

Impact of Artificial Intelligence (AI) on Automatic Speech Recognition Software Market

Continuous developments in technology, including the use of artificial intelligence in automatic speech recognition software, are creating opportunities in the market. AI-powered automatic speech recognition software accelerates the ability to learn and add new languages by using generative AI.

Narrow AI is utilized in automatic speech recognition software to perform a specific task or a limited range of tasks. Moreover, companies are developing and introducing automatic speech recognition software with artificial intelligence (AI) and deep machine learning (ML) to deliver accurate speech-enabled customer experiences, which create opportunities in the market. For instance,

• On August 3, 2021, LumenVox a leader in automatic speech recognition software, introduced its next-generation automatic speech recognition (ASR) engine, built on a foundation of artificial intelligence (AI) and deep machine learning (ML). It enables customers to quickly add new languages and non-native-speaking accents to it.

Automatic Speech Recognition Software Market Dynamics

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Major Drivers

Increasing adoption of smart homes around the world is expected to drive the market. Automatic speech recognition software is utilized in smart homes to control and monitor home appliances, such as smart TVs, smart lighting systems, smart security systems, and others, through voice commands. For instance,

• As per a report, the number of users of smart homes globally is projected to reach 672.57 million by 2027.

Existing Restraints

High cost of automatic speech recognition software is projected to impede the market. The development cost of automatic speech recognition software is high, as it requires significant research and development efforts, which involve specialized staff, acquiring data sets, and investing in hardware and software tools. Moreover, the inability of automatic speech recognition software to respond in loud background noise is expected to hamper the market.

Emerging Opportunities

Rising investment in R&D activities by major players to develop and introduce automatic recognition software with multilingual and multitasking supervised data creates opportunities in the market. For instance, on September 21, 2022, OpenAI, a US-based artificial intelligence organization, introduced Whisper, an automatic speech recognition (ASR) system trained on 680,000 hours of multilingual and multitasking supervised data. Whisper enables transcription in multiple languages and translation from those languages into English.

Scope of Automatic Speech Recognition Software Market Report

The report on the market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Automatic Speech Recognition Software Market Segment Insights

Type Segment Analysis

In terms of type, the automatic speech recognition software market is bifurcated into directed dialogue conversations and natural language conversations. The natural language conversations segment dominated the market in 2022 and is anticipated to continue its dominance throughout the assessment period, due to its ability to perform large-scale analysis and streamline processes.

Natural language conversation is used in automatic speech recognition software to understand the meaning of speech and deal with the interaction between humans and machines using a natural language such as English, simplifying the process and making it less time-consuming for the user.

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Application Segment Analysis

Based on application, the global market is segregated into recognition software for PCs and Macs, recognition software for phones and tablets, and recognition software for automobiles. The recognition software for smartphones and tablets segment held a large share of the market in 2022, due to improved telecom infrastructure, affordable handsets, frequent product launches, and increased disposable income.

Automatic speech recognition software is majorly used in smartphones and tablets to enable hands-free control and voice commands for call routing, speech-to-text processing, voice dialing, and voice search. This encourages the adoption of automatic speech recognition software in smartphones and tablets.

The recognition software for PCs and Macs segment is anticipated to grow at a robust pace in the coming years, owing to increasing spending on IT infrastructure and growing digitalization around the world. Automatic speech recognition software is being increasingly adopted in PCs and Macs, as it allows users to control their computer using only their voice.

Moreover, this software makes it possible to start programs, search the internet, navigate menus, write text, and access different parts of the computer just by speaking into the PC's mic. This is estimated to boost the demand for automatic speech recognition software in PCs and Macs.

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Industry Vertical Segment Analysis

In terms of industry vertical, the automatic speech recognition software market is categorized into healthcare, military, IT & telecommunication, automobile, manufacturing, BFSI, government, and others. The IT & telecommunication segment accounted for a major share of the market in 2022, due to expanding 4G and 5G coverage, affordable tariffs, and increasing internet penetration.

Automatic speech recognition software is primarily utilized in the telecommunication industry to transcribe conversations between customers and contact center agents, allowing for tracking, analysis, and quality control.

This software allows call center agents and managers to review customer interactions and extract valuable insights to improve their services. These benefits offered by automatic speech recognition software are boosting their demand in the IT & telecommunication industry.

The automobile segment is projected to grow at a considerable pace during the forecast period, owing to growing infrastructure, increasing foreign direct investment, and technological advancements in electric vehicles and autonomous driving. Automatic speech recognition software is used in automobiles for voice-enabled navigation systems and for placing and receiving hands-free calls.

Moreover, this software reduces the distraction levels of drivers, as drivers are able to access all features of the vehicle through speech or voice. This increases the adoption of automatic speech recognition software in automobiles.

Regional Outlook

Based on region, the automatic speech recognition software market is divided into Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. North America dominated the market in 2022, due to the growing adoption of voice-enabled applications in smartphones, increasing use of voice & speech recognition in mobile banking, and the presence of established market players such as SmartAction LLC, NeoSpeech, and OpenAI.

Moreover, increasing number of autonomous vehicles or self-driving vehicles in the region is projected to boost the demand for automatic speech recognition software, as this software is used in autonomous vehicles to switch radio stations, adjust volume, skip tracks, make and receive telephone calls, program the GPS, and adjust the air-conditioning. For instance,

• As per the report published by the National Association of Insurance Commissioners, 3.5 million self-driving vehicles are estimated to be present on US roads by 2025, and 4.5 million by 2030.

The market in Europe is anticipated to expand at a high CAGR during the forecast period, owing to increasing innovation and advancement in speech recognition and voice assistant software to support French, Spanish, Italian, Russian, German, and other European languages. 

Moreover, increasing adoption of smart home products or devices in the region is boosting the demand for automatic speech recognition software, as it is installed and used in smart home devices to manage and control the devices through voice or speech remotely. For instance,

• According to Internationale Funkausstellung Berlin (IFA), 41% of Germans have installed at least one smart home product in 2021.

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