Korean mobile carriers pursue AI call centers as new growth engine

[Courtesy of LG Uplus]

Artificial intelligence contact center (AICC), an AI-based contact center solution that facilitates the activities of customer service agents and handles customer service quickly, is emerging as a new growth engine for South Korean telecommunications companies. Call centers can improve work efficiency by combining the know-how of operating customer service centers with information and communication technology (ICT) infrastructure as well as AI technology. Mobile carriers can expand their AICC business as cloud-based services, which is now possible via business-to-business (B2B) transactions.

According to the telecommunications industry on Wednesday, the nation’s three mobile carriers—SK Telecom Co., KT Corp., and LG Uplus Corp.—will expand their services by making AICC their key new business.

AICC is a system that optimizes the entire customer center workflow using technologies including speech recognition, speech synthesis, and text analysis. It enables AI voices for identity verification and automated consultations using voice bots and chatbots. The market is growing as companies and small businesses, in addition to financial companies with large numbers of customer questions, are also expanding their adoption of the solution to improve customer response efficiency. According to market research firm Research and Markets, the global AICC market is expected to grow 25 percent annually to $36.1 billion in 2025, up from $15.5 billion in 2020. The Korean AICC market is also expected to grow at an average of 23.7 percent annually to $350.88 million in 2030 from $42.14 million in 2020, according to market research firm Allied Market Research.

“Currently, voice bots (robots that communicate with users through speech) in AICCs maximize the work efficiency of human agents while partially replacing their work,” KB Securities Co. analyst Kim Jun-seop said. “Research shows that, with the application of generative AI to AICCs, voice bots can respond naturally without the need to create scripts.” He says that the expanded use of AICCs reduces costs and improves services.

The three mobile carriers have slightly different plans for the future of AICC business.

SK Telecom has invested in an AI company to develop AICC products and promote joint business. It invested 22.4 billion won ($17.01 million) in domestic AI solution company Konan Technology Inc. in October 2022, and became its second largest shareholder and invested in Persona AI, a domestic AICC developer, to become its third largest shareholder in August. In collaboration with Persona AI, SK Telecom is preparing to launch a subscription based AICC service that combines chatbot and callbot products with voice recognition technology from its AI platform NUGU this month. The company also plans to build and introduce an AICC service linked to a large language model (LLM).

Fellow mobile carrier KT, which operates the largest call center in Korea with 8,000 seats, has used an AICC since 2018 and is already reaping the results. The average number of phone calls handled per month has declined by 470,000 since the implementation, and the time it takes to verify an AI voice has been reduced by 15 seconds on average to five seconds from 20 seconds, KT said.

The company also launched A’Cen Cloud, a subscription based AICC service, in late 2022 to promote its expansion into the B2B business. Instead of having to build their own AICC, companies can use KT’s AICC service by paying a monthly fee.

In the meantime, LG Uplus said early last month that it would actively target the AICC B2B business with its two AICC projects. One of them, “AICC On-Premise,” is a built-in AICC combining multiple AI solutions and allowing companies to design their own contact centers. Its main customers are financial companies and large enterprises with a great need for work efficiency. Since its launch in March 2021, it has achieved about 55 billion won in orders in just over two years.