Natural language understanding (NLU) is a branch of artificial intelligence (AI) that uses computer software to understand input made in the form of sentences in text or speech format.
NLU directly enables human-computer interaction (HCI). NLU understanding of natural human languages enables computers to understand commands without the formalized syntax of computer languages and for computers to communicate back to humans in their own languages.
The field of NLU is an important and challenging subset of natural language processing (NLP). While both understand human language, NLU is tasked with communicating with untrained individuals and understanding their intent, meaning that NLU goes beyond understanding words and interprets meaning. NLU is even programmed with the ability to understand meaning in spite of common human errors like mispronunciations or transposed letters or words.
NLU uses algorithms to reduce human speech into a structured ontology. AI fishes out such things as intent, timing, locations and sentiments. For example, a request for an island camping trip on Vancouver Island on the 18th of august might break down something like this: Ferry tickets [intent] / need: camping lot reservation [intent] / Vancouver Island [location] / August 18th [date].
The main drive behind NLU is to create chat and speech enabled bots that can interact effectively with the public without supervision. NLU is a pursuit of many start up and major IT companies. Companies working on NLU include Medium's Lola, Amazon's with Alexis and Lex, Apple's Siri, Google's Assistant and Microsoft's Cortana.