What is 'Natural Language Processing (NLP)'

Natural Language Processing (NLP) is a field of artificial intelligence that enables computers to analyze and understand human language. It was formulated to build software that generates and comprehends natural languages, so that a user can have natural conversations with his or her computer instead of through programming or artificial languages like Java or C.

BREAKING DOWN 'Natural Language Processing (NLP)'

Natural Language Processing (NLP) is one step in a larger mission for the technology sector – namely, to use artificial intelligence (AI) to simplify the way the world works. The digital world has proved to be a game-changer for a lot of companies as an increasingly technology-savvy population finds new ways of interacting online with each other and with companies. Social media has redefined the meaning of community; cryptocurrency has changed the digital payment norm; e-commerce has created a new meaning of the word convenience; and cloud storage has introduced another level of data retention to the masses.

Through AI, fields like machine learning and deep learning are opening eyes to a world of all possibilities. Machine learning is increasingly being used in data analytics to make sense of big data. It is also used to program chatbots to simulate human conversations with customers. However, these forward applications of machine learning wouldn't be possible without the improvisation of Natural Language Processing (NLP).

How does NLP actually work?

NLP combines AI with computational linguistics and computer science to process human or natural languages and speech. The process can be broken down into three parts. The first task of NLP is to understand the natural language received by the computer. The computer uses a built-in statistical model to perform a speech recognition routine that converts the natural language to a programming language. It does this by breaking down a recent speech it hears into tiny units, and then compares these units to previous units from a previous speech. The output or result in text format statistically determines the words and sentences that were most likely said. This first task is called the speech-to-text process.

The next task is called the part-of-speech (POS) tagging or word-category disambiguation. This process elementarily identifies words in their grammatical forms as nouns, verbs, adjectives, past tense, etc. using a set of lexicon rules coded into the computer. After these two processes, the computer probably now understands the meaning of the speech that was made.

The third step taken by an NLP is text-to-speech conversion. At this stage, the computer programming language is converted into an audible or textual format for the user. A financial news chatbot, for example, that is asked a question like “How is Google doing today?” will most likely scan online finance sites for Google stock, and may decide to select only information like price and volume as its reply.

NLP attempts to make computers intelligent by making humans believe they are interacting with another human. The Turing test, proposed by Alan Turing in 1950, states that a computer can be fully intelligent if it can think and make a conversation like a human without the human knowing he or she is conversing with a machine. So far, only one computer has passed the test – a chatbot with the persona of a 13-year-old boy. This is not to say that an intelligent machine is impossible to build, but it does outline the difficulties inherent in making a computer think or converse like a human. Since words can be used in different contexts, and machines don’t have the real life experience that humans have for conveying and describing entities in words, it may take a little while longer before the world can completely do away with computer programming language.

  1. Machine Learning

    Machine learning is the idea that a computer program can adapt ...
  2. AI Winter

    AI (Artificial Intelligence) winter is a time period in which ...
  3. Strong AI

    Strong AI is a type of machine intelligence that is equivalent ...
  4. Chatbot

    A chatbot is a computer program that simulates human conversation ...
  5. Weak AI

    Weak AI is a machine intelligence that is limited to a particular ...
  6. Human Capital

    Human capital is a measure of the economic value of an employee's ...
Related Articles
  1. Investing

    Languages That Give You The Best Chance To Broaden Your Career

    Being bilingual or trilingual can be a great career booster. Here are the languages that will help you get ahead in the business world.
  2. Investing

    Facebook's AI Translates 9X Faster Than Rivals

    Facebook says they have AI technology that can translate languages nine times faster than its peers.
  3. Investing

    Microsoft Studying Multilingual Speech to Humanize Cortana

    Microsoft researchers in India are working on a way to make Cortana understand the practice of code-mixing.
  4. Investing

    Facebook Messenger Can Now Understand Spanish

    Facebook's new 'M' AI assistant in Messenger can now make suggestions in both English and Spanish.
  5. Personal Finance

    Is a Robo-Advisor Right for Your Investments?

    When it comes to managing your investments, how much of a role should a robo-advisor play?
  6. Investing

    Microsoft Names AI Top Priority In Annual Report

    The tech giant identified artificial intelligence as a top priority in its new annual report.
  7. Investing

    How Human Capital Can Affect You Financial

    Understand how human capital assists in capturing the entirety of an investor’s unique risks, returns and constraints is your best asset as you get older.
  8. Investing

    Zuckerberg and Musk Clash Over the Future of AI

    Zuckerberg is against doomsday scenarios, while Musk wants more regulation of the technology.
  9. Investing

    How Google, Facebook, Amazon Will Ride The AI Wave

    No Brainer: These 9 major stocks are poised to outperform over the next decade as they lead the AI revolution
  10. Financial Advisor

    How AI is Shaping the Advisory Landscape

    While many have been slow to adapt AI or wary of its benefits, financial advisors who do not adapt the technology to their practice will be left behind.
  1. What is the relationship between human capital and economic growth?

    Learn what human capital and economic growth are, how human capital is related to economic growth and see examples of the ... Read Answer >>
  2. How does economics study human action and behavior?

    Find out why economics can be considered a deductive social science, like sociology, and how human action and behavior informs ... Read Answer >>
  3. Human capital vs. physical capital: What is the difference?

    Learn the difference between physical capital and human capital. How to find the value of each type of capital in a company's ... Read Answer >>
  4. How is an economy formed and why does it grow?

    Find out how an economy forms and why it grows, including the role that financial markets play and how productivity increases ... Read Answer >>
Trading Center