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Tech firms bet big on content moderation business – ETtech.com


Tech firms bet big on content moderation business
A few large technology services companies and their boutique counterparts are betting big on the content moderation services business, analysts have said.

This is a business that IT services provider Cognizant said recently it was exiting, pushed by the challenges of dealing with stressed employees and new strategy.

Content moderation work involves tasks like filtering a video, image or text with hate messages, which could end up hurting organisations, businesses or others.

Globally, this type of work has received criticism due to the high stress and long hours employees face, often leading to an unhealthy work-life balance. Staff at such businesses are often underpaid, said analysts.

The size of the content moderation services market, which is in huge demand from social networking firms, is pegged at nearly $2 billion, according to Ray Wang, chief analyst of Silicon Valley-based Constellation Research.

The technology services and business process management industry continues to see higher demand for content moderation services and companies such as Accenture, Wipro, Genpact and domestic boutique firms are seeing a sharp rise in opportunities, said Peter Bendor-Samuel, chief executive, Everest Group, an IT advisory and research firm.

“It is true that some of the roles in content moderation are challenging and can be disturbing if not handled well. However, the need is growing, creating a robust and growing market. Also, the industry is learning how to better support their employees in these roles,” said Bendor-Samuel.

Experts said revenue generated by this business comes at a reputation cost for companies, and does not add value to the company.

ET reported earlier that Cognizant had come under scrutiny for the work environment of its content moderators and the impact such work was having on their mental health.

Cognizant’s exit from this segment, roughly worth $250 million, is also largely strategic to the company’s future, analysts said.

“I don’t think this (Cognizant’s exit) changes the business. We see huge demand and requests from the social networks for more help as this is not an easy job,” said Wang of Constellation Research.

Experts said large IT companies face more costs in this business compared to smaller boutique firms, due to higher employee management costs, increased locations, processes etc.

“We are seeing demand both from domestic and global firms. There has been a huge growth in vernacular apps in India, which we think will be the next phase of our growth,” said Aravind Rao, co-founder of content moderation firm Infoesearch.

Smaller firms not only rely on cracking big deals but also have a competitive advantage due to the number of clients that they handle, he said, compared to IT companies who prefer to do business only with a few global tech giants.

Vishwakumar Nandagopal, head of India operations and regional controller for APAC at ISG, said a set of boutique companies are also prominent in offering content moderation services.

“We do not see any shortfall; others will pick up. For this type of business, there are a few small players in the market. We will also see more automation coming in for this segment,” he said.





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