What Is Natural Language Processing (NLP)?

By Motley Fool Staff – Updated Nov 12, 2024 at 10:15 AM

Key Points

NLP, a branch of AI, is embedded in daily tech like smartphones, enhancing user interaction.
Modern NLP tools like GPT-3 can write and code, mimicking human responses with high accuracy.
Investors should watch NLP innovations for potential efficiency gains in business operations.

Natural language processing (NLP) is a fast-growing type of artificial intelligence (AI). You've probably benefitted from NLP if you've asked your smartphone for directions to a restaurant or run a spell-check on a word processing program. Read on to learn more about NLP, its history and development, and how it's being used.

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Artificial intelligence robots working in an office. — Image source: Getty Images.

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Machine Learning

Machine learning is a technique by which artificial intelligence programs are trained.

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NLP involves two basic steps: data preprocessing and algorithm development. Data preprocessing generally uses at least one of four steps to allow the machine to work with text data:

Tokenization: The text is broken down into digestible parts.
Stop word removal: Common words are removed from the text, providing more information from unique words.
Lemmatization: Words are reduced to their root forms.
Part-of-speech tagging: Words are broken down into parts of speech (i.e., nouns, verbs, and so forth).

Once data preprocessing has been completed, an algorithm takes over. Two main types are used in NLP:

Rules-based: This approach uses linguistic techniques that allow the computer to process the information. It's similar to the approach used in the very early days of AI.
Machine learning-based: Statistical systems are used to teach the computer to process the information, often using a combination of machine learning and neural networks.

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