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5 reasons why Generative AI is a disruptive telco catalyst

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October 04, 2023

Are telcos missing out on bigger revenue opportunities?  

The answer might be yes if the telecommunication industry fails to acknowledge and utilize the potential of Generative AI. 

So, what is Generative AI? Generative Artificial Intelligence (AI) is a type of advanced technology that can imitate human creative processes by ‘generating’ new data identical to the kind it was trained on. Essentially, it can generate images, text, and other forms of media in response to prompts given as inputs. Common examples of Generative AI are ChatGPT by OpenAI and Bard by Google. 

This new development in technology promises striking results. As per Deloitte, it is estimated by various analysts that the market for Generative AI will be valued at $200B by 2032, and according to AWS, Generative AI is expected to increase the global GDP by 7% and increase productivity growth by 1.5% over 10 years. These statistics give an overview of what Generative AI can do, and its impact extends to the telco industry. 

Generative use in the telecom industry, or “telco generative applications,” refers to using generative technologies and artificial intelligence (AI) to enhance various telecommunication services and operations. Leveraging the power of this technology, it can transform the telecom sector, promising innovative and effective methods through which communication services are delivered and experienced. Let’s have a look at the top 5 reasons why Gen AI is a transformative catalyst in the telco sector. 

    1. Improved network & capacity optimization

Generative AI has various applications in network optimization for telecommunications companies. It can use historical data to analyse and predict network traffic by identifying patterns and anticipating demands which can help telco providers to optimize their capacity and deliver improved and uninterrupted services.  

In addition, by employing generative machine learning models, telcos can anticipate potential network failures and performance issues by studying historical data, leading to proactive maintenance and reduced downtime. This predictive maintenance approach enhances network reliability and customer satisfaction.  

    2. Enabling fraud detection 

Did you know that according to McKinsey, fraud losses for internet crimes alone sum up to $6.9 billion in the U.S. in 2021 and markets globally experience similar spikes in fraudulent activity?  

These figures represent an alarming situation, and it is the need of the hour for telco providers to improve fraud detection services. 

Generative AI is a powerful tool to curb crime rate and reduce fraud-related activities. Generative AI can be employed for analysing customer behaviour and detecting patterns indicative of fraud, enabling proactive measures to safeguard customers. By employing Generative AI, telecom companies can identify suspicious activities, such as unusual call patterns or excessive text messaging, which may signal potential fraud.  

In addition, this technology can play a crucial role in detecting activities such as hacking and spamming, by analysing network data to spot fraudulent patterns and promptly notifying operators for intervention. By leveraging Generative AI’s capabilities, telecom operators can prevent financial losses and uphold network integrity, enhancing overall customer protection and security. 

    3. Enhancing customer experience 

In a Forbes article, according to the 2022 State of Customer Churn in Telecom report, due to poor customer experience, customer loyalty to telecom providers has dramatically decreased by 22% post-pandemic.  

Thus, it is imperative for telco providers to invest their resources in improving customer service. Fortunately, Generative AI is here to save the day. 

Generative AI technologies like Natural Language Processing (NLP) and voice synthesis can transform customer interactions in the telecom industry. By using NLP algorithms telecom companies can create chatbots and virtual assistants capable of handling customer inquiries in real-time. These virtual agents, powered by generative language models, understand and respond to natural language queries, leading to faster and more efficient customer support. This leads to improved customer satisfaction and personalized experience for users.  

Telecom providers can also adopt IVR systems, that are integrated with Generative AI, to have human-like voice prompts and personalized scripts which are subject to change based on customer needs instead of pre-recorded messages.  

    4. Developing better marketing strategies 

Based on an IBM survey, 35% of respondents believe that Generative AI is among the most prominent emerging technologies that will significantly impact business processes, including marketing, in the coming years. This technology is expected to revolutionize automation for marketers, as it can generate content from scratch, opening new possibilities in content creation and marketing strategies. 

Generative AI can be used for various content-creating purposes such as creating content for social media posts and scriptwriting for videos. Generative AI can also aid in determining relevant and high-performing keywords which can help with SEO. Moreover, Generative AI’s use can also be extended to generating images with deep learning algorithms and generative adversarial networks (GANs). 

Marketing – Predicting customer preferences, generating targeted content, and offering smart product recommendations. 

By leveraging generative models, telecom companies can gain valuable insights into customer behaviour and preferences. These insights can be used to create personalized marketing campaigns, tailor service offerings, and improve customer retention strategies. 

Generative AI can automate various aspects of marketing, such as email marketing, social media marketing, and search engine marketing. This includes automating the creation and distribution of marketing content, as well as analysing the performance of marketing campaigns.  

    5. Proactive & predictive maintenance 

By using Generative AI companies can discover patterns and problematic areas previously unknown and analyse data from network equipment to identify potential problems before they occur. This can result in proper scheduling of predictive maintenance which can result in optimized network capacity and increase in reliability. 

These are just a few examples that unravel the potential that Generative AI holds in transforming the telco industry soon. By harnessing the power of this new technology, the telco industry can revolutionize and improve its operational efficiency with less investment in resources.  

To learn more, feel free to get in touch with us.  

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