Chris Silberberg
Chris Silberberg (Research Manager, European Telco Insights)

From its inception, the telecommunications industry has leveraged automation to enhance services and user experiences. As AI takes center stage, IDC surveys have shown that the primary use case for telco AI will be the improvement of customer experience (CX).

Telco AI: What’s Already Been Done?

The advent of telco AI can be seen as early as the beginnings of mechanical telephone switching in the 1890s. The introduction of the mechanical switch revolutionized the way callers connected, leading to faster connections and effectively managing the exponentially increasing complexity of connections as landline phone penetration skyrocketed.

“That’s not AI — that’s just automation!” you may cry. But the impact on the workforce of manual switch operators was profound. And this shares some similarities to the transformative effect that generative AI (GenAI) applications are having on creative professionals today.

In recent history, the visible face of AI in telecoms is the ubiquitous digital customer service agent — the chatbot. Examples like Vodafone’s TOBi, launched in 2017, showcase the initial steps toward automated customer interactions.

These applications, however, often struggle when customers deviate from predetermined scripts. Beneath the surface, telecom networks rely heavily on AI and automation to optimize services, rout network traffic, monitor anomalies, and analyze customer interactions to recommend tailored product bundles.

What Telco AI Use Cases Will Be Big in 2024?

The successful launch of OpenAI’s ChatGPT in 2022 significantly elevated industry expectations for AI applications. Throughout 2023, experimentation accelerated, particularly in telecom CX, software coding support, and knowledge management.

In 2024, these use cases are set to expand into production environments, with continued exploration of how predictive and generative AI can support existing telecoms use cases.

Two key CX use cases are customer-facing chatbots that have enhanced natural language understanding, and AI customer sentiment analysis and personalization. By leveraging large language models (LLMs) and retrieval augmented generation (RAG) capabilities, chatbots will be able to answer customer questions like, “Why is my bill higher this month?” Such capability was extremely rare previously. Telcos like BT, DT, Orange, and Vodafone are examples of telcos exploring these capabilities.

Beyond CX, AI will bolster coder productivity with solutions like Microsoft Github Copilot and Amazon CodeWhisperer. Investment will go toward internal chatbots and knowledge management tools across departments, including sales, HR, legal, and network operations.

How AI Will Shape Telco CX by 2030

Looking to 2030, AI’s role in telecoms will become even more customer-centric. For example, energy efficiency solutions, currently focused on macro-networks, could be extended to customer devices, prolonging battery life.

Direct changes in customer interactions will manifest in advanced chatbots offering complete digital sales experiences. These chatbots will craft personalized packages based on customer preferences and budgets, eliminating the need for human intervention.

Moreover, this evolution in chatbots will align with the rise of metaverse environments that will incorporate visual representations of AI agents and use features like AI-driven body language to boost customer engagement in a 3D environment.

In summary, 2024 sees the telecoms industry again at the forefront of significant transformations, propelled by AI’s ability to automate tasks and deliver an elevated customer experience. At IDC, we will continue to cover the development of AI technologies and the telecoms industry in depth, with some of our most recent reports focusing on the telecoms GenAI value chain and the AI-driven evolution of telco CX platforms.

Spread the love