China's natural language processing (NLP) development is expected to see rapid development as Microsoft-backed ChatGPT has taken the tech world by storm. But additional joint efforts are needed for more homegrown breakthroughs, according to a senior company executive.

"China is quickly catching up with leading economies in the NLP field in recent years, despite the late start. To some extent, the two economies (China and US) are comparable in NLP development," said Zhou Yu, chairman of Beijing Fanyu Technology Co Ltd, a leading provider of NLP products and services.

"United States' enterprises are better at making cutting-edge artificial intelligence innovations while Chinese companies are more flexible in creating personalized products and innovations, especially in niche sectors," Zhou said.

NLP is basically the ability of a computer program to understand human language as it is spoken and written. It is widely considered a critical technology behind ChatGPT, one of the hottest tech applications of late.

"Technologies behind ChatGPT are not new to market players, but ChatGPT represents how AI has evolved and progressed over the past few years. Also, it demonstrates the popularity of the NLP market and brings forward the market one to two years," Zhou added.

To develop an alternative for Chinese companies, she pointed out that it is not suitable for startups to burn money to chase large models, and it is more affordable for them to focus on a smaller model and offer personalized services for customers.

"Trying to surpass OpenAI in an all-around way is not recommended. Exploring a niche market and doing so step-by-step will be more realistic," Zhou added.

Founded in 2018, Fanyu Technology offers NLP products and services to more than 100 clients, and has helped promote an array of major national projects. Though having a short history, the Beijing-based firm is backed by the Institute of Automation of the Chinese Academy of Sciences, which has accumulated related technology and talent for decades.

Zhou said the company's products have been applied into sectors including education, aviation and medical care, with big-name clients such as Boeing. "As China gears up efforts in developing AI and digital economy, China's NLP market is expected to embrace another round of development and will surely gain a lead globally in the years to come," she said.

The latest Government Work Report, revealed during this year's two sessions — the top legislative and political advisory meetings — stated that key priorities this year include pooling of quality resources and concerted efforts to achieve breakthroughs in core technologies in key fields.

Looking ahead, Zhou said the domestic NLP market still faces some bottlenecks, such as a lack of data resources and free flow of data.

"Many of the data resources are relatively fragmented, which causes difficulty for companies to collect and label data."