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Chatbots Enter the Tech Conversation

Did you ever hear of a chatbot? Have you ever used one? If you’ve spoken with Apple’s Siri or made a request of Microsoft’s Cortana, then you have.

Chatbots are simple artificial intelligence (AI) systems that you interact with via text or spoken word, basically simulating a real conversation. They are used to fulfill a request, such as letting you know what the rush-hour traffic will be, or handling some customer service issue, such as opening or closing an account.   

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A chatbot is essentially engaged via instant messaging. Why? People, skewing younger, are now using messenger apps more than social networks. Facebook Messenger is at the leading edge, hosting more than 30,000 chatbots on its platform. These chatbots are targeting the one billion people who use Facebook each month. In addition, companies such as MasterCard, Whole Foods, 1-800-Flowers and a host of others are creating their own chatbots to enhance the user experience.

Types

Currently, there are two types of chatbots: (1) limited ones that can only respond to very specific commands—like our friend Siri and (2) ones that use AI to understand language, vs. just commands, that actually get smarter as they have more conversations with people—such as self-driving cars.

Investment

According to Venturbeat estimates, more than 170 companies are currently in the chatbot sector, backed by $4 billion in funding. For example, Message.io, a company that translates chatbot language for multi-platforms, just received $2.5 million in seed money; Digit, a startup that designs chatbots for the growing fintech sector, raised $36 million in a recent round of VC funding.

Concerns

Not all chatbot designers are working for the greater good. Some are developing phishing tools to entice people to reveal their personal information. As such, leading technology companies such as Amazon, Facebook, Google, IBM, and Microsoft are calling for a chatbot framework to help mitigate such risks.

The Future

Chatbots will probably continue to evolve to where they will need less and less prompting and information from people to answer a question of fulfill a request. However, there will always be a need for humans jump in to fill any gap in miscommunication … at least until the robots fully conquer our civilization.

Phil Bergamo is a Senior Audit Manager overseeing engagement teams that perform audit services for clients in a variety of industries including technology and not-for-profit.

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