Growth Prospects Transforming the North American Optical Character Recognition Space
While traditional OCR is the larger segment in this growing market, AI OCR is expected to record explosive growth
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Optical character recognition is a technology that allows users to extract text from scanned documents, images, and videos and convert it into a digital format that is more searchable and easy to edit. The market is segmented into traditional OCR and AI OCR. AI OCR leverages Machine Learning-powered AI to contextually capture text and classify it with minimal human input.
In 2019, revenue growth in the North American OCR market was primarily driven by expansion in the AI OCR segment and increased accessibility through cloud deployments, mobile capture, and subscription-based pricing models. Market growth is also driven by other factors: including a preference among organizations to adopt OCR in order to reduce the time spent on data entry (which enables employees to focus on core operations), the need to identify and classify sensitive information in industries where compliance is critical, and the use of AI and Machine Learning (ML) to deliver improved accuracy. The market is restrained by factors such as intense competition among vendors eroding profit margins, fear of job loss among employees due to automation, and difficulties in customizing the OCR software (which implies that if a document deviates from the rules, the output could be unusable).