Telco ‘bots’ to save $1.2B for their telco masters by 2022: report

A new wave of telco virtual assistants, or telco “bots”, is emerging as telcos increasingly start to adopt artificial intelligence (AI) to improve their customer services.

Photo credit: TM Forum Inform

Photo credit: TM Forum Inform

While telcos are currently prioritizing virtual assistants primarily to improve customer engagements and consequently reduce churn rates, they are also positioning themselves to compete directly with the Siris, Cortanas, and Alexas of the tech giants.

Analyst firm ABI Research forecasts that the virtual assistants will enable telcos to save $1.2 billion on customer care management by 2022 with a CAGR of 17% over the next five years. This is particularly impressive given that telcos were not the early adopters of virtual assistants.

“The recent introduction of virtual assistants in customer service signifies the level of urgency within telcos to start emphasizing the importance of customer relationships and customer care management, something they have been taking for granted for decades,” said Sarju Vasavada, industry analyst at ABI Research.

“Case in point, Vodafone released TOBi, a virtual assistant to address their customer service woes after being fined £4.6 million by UK regulators Ofcom for falsely charging more than 10k pay-as-you-go customers for top-up credit. They also had a record-breaking number of customer complaints until TOBi stepped in.”

Telcobots now assist customers with a variety of issues ranging from basic account inquiries to SIM purchases, service troubleshooting, and technical settings.

Several telcos are leveraging AI and NLP heavyweights, including IBM Watson, Nuance, LivePerson, and IPsoft or are building technology in-house.

However, the most important point is that telcos are realizing the advantages and benefits of adding virtual assistants to their arsenal for customer service delivery and are aggressive in introducing them throughout their footprint.

ABI Research forecasts that AI investments by telcos will reach $14 billion by 2022 with a CAGR of 22.4%. The fruits of early AI investments by tier 1 telcos are beginning to grow.

“Telcos are slowly but steadily getting ready for prime time. We are bullish on telcos making this “Next-Gen” leap within next five years,” said Vasavada.

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