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Data Annotation Tools Market to Gain Substantial Growth During the Forecast Period 2022-2030

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Viraj Patil

Data Annotation Tools Industry Overview


The global data annotation tools market size was valued at USD 629.5 USD million in 2021 and is anticipated to expand at a compound annual growth rate (CAGR) of 26.6% from 2022 to 2030.


The growth is majorly driven by the increasing adoption of image data annotation tools in the automotive, retail, and healthcare sectors. The data annotation tools enable users to enhance the value of data by adding attribute tags to it or labeling it. The key benefit of using annotation tools is that the combination of data attributes enables users to manage the data definition at a single location and eliminates the need to rewrite similar rules in multiple places. The rise of big data and the surge in the number of large datasets are likely to necessitate the use of artificial intelligence technologies in the field of data annotations. The data annotation industry is also expected to have benefited from the rising demands for improvements in machine learning as well as in the rising investment in advanced autonomous driving technology.


Gather more insights about the market drivers, restrains and growth of the Global Data Annotation Tools Market


Data annotation is expected to play a major role in enhancing the applications of AI in the healthcare sector. AI-backed machines use machine vision or computer vision in medical imaging data technologies to sense patterns and identify possible injuries, which assists medical practitioners in automatically generating reports after the individual is examined. The database of CT scans, MRI, and X-Ray images can be easily screened by the AI to determine various injuries. Data annotation tools help train AI systems in differentiating data obtained from normal and injured medical images to generate the final reports of the examined individuals. Thus, data annotation is expected to play a major role in enhancing the applications of AI in the healthcare sector. For instance, in March 2021, Innodata Inc., a U.S.-based company, announced its expansion of AI data annotation tools capabilities to include the medical reports of the patients. Innodata has established plans to synthesize its capabilities from the AI Data annotation tools platform and Synodex medical data extraction platform, to create a medical record data annotation platform. Via this, high-quality AI training data will be created that is likely to carry HIPAA compliance and follow all the security protocols.


Technologies such as the Internet of Things (IoT), Machine Learning (ML), robotics, advanced predictive analytics, and Artificial Intelligence (AI) generate massive data. With changing technologies, data efficiency proves to be essential for creating new business innovations, infrastructure, and new economics. These factors have significantly contributed to the growth of the industry. Owing to the rising scope of growth in data labeling, companies developing AI-enabled healthcare applications are collaborating with data annotation companies to provide the required data sets that can assist them in enhancing their machine learning and deep learning capabilities. For instance, in November 2020, Telus International, a provider of digital customer experience (CX), and digital IT solutions & services announced to acquire Lionbridge AI, which offers training data and annotation platform solutions used for designing AI algorithms to power machine learning. The acquisition is expected to enhance Telus International’s next-generation digital solution portfolio and expand its reach worldwide.


However, the inaccuracy of data annotation tools acts as a restraint to the growth of the market. For instance, a given image may have low resolution and include multiple objects, making it difficult to label. The primary challenge faced by the market is issues related to inaccuracy in the quality of data labeled. In some cases, the data labeled manually may contain erroneous labeling and the time to detect such erroneous labels may vary, which further adds to the cost of the entire annotation process. However, with the development of sophisticated algorithms, the accuracy of automated data annotation tools is improving and thus reducing the dependency on manual annotation and the cost of the tools in the near future.


Browse through Grand View Research's Next Generation Technologies Industry Research Reports.

  • Big Data Market - The global big data market size was valued at USD 25.67 billion in 2015 and is expected to witness significant growth over the forecast period.
  • Computer Vision Market - The global computer vision market size was valued at USD 11.32 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 7.3% from 2021 to 2028.
  • Machine Vision Market - The global machine vision market size was valued at 13.23 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 7.7% from 2022 to 2030


Data Annotation Tools Market Segmentation

Grand View Research has segmented the global data annotation tools market based on type, annotation type, vertical, and regions:

  • Data Annotation Tools Type Outlook (Revenue, USD Million, 2017 - 2030)
  • Text
  • Image/Video
  • Audio
  • Data Annotation Tools Annotation Type Outlook (Revenue, USD Million, 2017 - 2030)
  • Manual
  • Semi-supervised
  • Automatic
  • Data Annotation Tools Vertical Outlook (Revenue, USD Million, 2017 - 2030)
  • IT
  • Automotive
  • Government
  • Healthcare
  • Financial Services
  • Retail
  • Others
  • Data Annotation Tools Regional Outlook (Revenue, USD Billion, 2018- 2030)
  • North America
  • Europe
  • Asia Pacific
  • South America
  • Middle East & Africa


Market Share Insights

  • November 2018: CloudFactory Limited- a cloud-based platform that offers machine learning, data enrichment services, and data transcription solutions raised funding worth USD 65 million in its growth equity round, thus equating its total raised amount to USD 78 million.
  • April 2021: Congenica Ltd, a provider of data analytics tools for annotating and clinically interpreting genomic sequence data, announced a partnership with Camtech Diagnostics, a U.K.-based technology company with a specialization in microfluidics


Key Companies profiled:

Some prominent players in the Data Annotation Tools market include

  • Annotate.com
  • Appen Limited
  • Cloud App
  • Cogito Tech LLC
  • Deep Systems
  • Labelbox, Inc
  • LightTag
  • Lotus Quality Assurance
  • Playment Inc
  • Tagtog Sp. z o.o
  • CloudFactory Limited
  • ClickWorker GmbH
  • Alegion and many others


Order a free sample PDF of the Data Annotation Tools Market Intelligence Study, published by Grand View Research.

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