Personal Virtual Assistants: Primer and Planning Guide

We used to laugh at the idea of “the talking toaster” when thinking about the gratuitous addition of a speech-based interface to household appliances, consumer electronics, self-service kiosks or even ATMs. Now the machines laugh at us, as improvements in natural language understanding, artificial intelligence and text-to-speech rendering make phones, tablets, computers and (yes) household appliances more conversational, human-like and responsive to spoken input.

November 2012

Dan Miller, Senior Analyst – Conversational Commerce

Opus Research, Inc. 350 Brannan St., Suite 340 San Francisco, CA 94107 For sales inquires please e-mail [email protected] or call +1(415)904-7666 This report shall be used solely for internal information purposes. Reproduction of this report without prior written permission is forbidden. Access to this report is limited to the license terms agreed to originally and any changes must be agreed upon in writing. The information contained herein has been obtained from sources believe to be reliable. However, Opus Research, Inc. accepts no responsibility whatsoever for the content or legality of the report. Opus Research, Inc. disclaims all warranties as to the accuracy, completeness or adequacy of such information. Further, Opus Research, Inc. shall have no liability for errors, omissions or inadequacies in the information contained herein or interpretations thereof. The opinions expressed herein may not necessarily coincide with the opinions and viewpoints of Opus Research, Inc. and are subject to change without notice. Published November 2012 © Opus Research, Inc. All rights reserved.

PVA Planning Guide Page ii

Key Findings Personal Virtual Assistants (PVAs), like Apple’s Siri, are here to stay thanks to steady improvement in Natural Language Understanding (NLU), Artificial Intelligence (AI) and underlying computer and networking power. In this document, Opus Research will describe, compare and contrast different products and services to help readers determine what will work in both mobile and enterprise settings:

• “Personal Virtual Assistant” (PVA) describes the “conversational user interface” - enabling individuals to use their own words to provide instructions to devices, describe what they want, schedule events or conduct searches.

• The role for PVAs on mobile devices and in contact centers is growing rapidly – thanks to improvements and expansion of natural language processing (NLP) in popular verticals like financial services, telecommunications, retailing and, more generally, customer care

• Competition comes from multiple disciplines – including device makers (Apple, Google), chatbots, knowledge management and contact center automation

• There’s a business case for PVAs in the enterprise – as solutions providers integrate artificial intelligence and decisioning into agent workstations, Web chat and interactive voice response systems to achieve common business objectives (like customer retention, customer satisfaction, increased sales, etc.)

• PVAs accelerate the trend toward “human-aided self service” – PVAs steer people “around” traditional interactive voice response (IVR) systems and are being embedded in Web chat to make it less clear whether an individual is interacting with an automated system or a live agent

• Progress focuses on verticals and specific functions – while it is tempting to “boil the ocean” and provide a broad set of features, functions or services, PVAs perform best when addressing specific verticals, emulating well-understood activities (E.g. customer care for telecoms)

Table of Contents Key Findings ...... ii! Siri Rekindles Interest in Personal Virtual Assistants ...... 1! Search Giant Responds with Google Now ...... 1! Precursors to Siri: Voice Portals and PVAs ...... 2! Lessons Learned from the First Generation ...... 2! Requirements for the New Millennium ...... 3! PVA Competitors ...... 5! Nuance’s Portfolio: Nina, DragonGo! and Vlingo (Hey Dragon) ...... 5! Angel’s Lexee Leverages Deep Roots in Analytics ...... 6! SRI Tailors Lola for Spanish Banking Leader ...... 7! “Chatbots” Finding Their Voice As Virtual Agents ...... 8! VirtuOz’ IVAs Leverage Customer Care Infrastructure ...... 10! Creative Virtual’s 2,500 Questions ...... 11! A Bright Future for the Conversational Interface ...... 12! Implications for Customer Care and Mobile Commerce ...... 12! “Have Your Assistant Call My Assistant” ...... 13! Appendix I: Selected Vendor Profiles ...... 14! Anboto ...... 14! Artificial Solutions ...... 15! Expert System ...... 16! Indisys ...... 17! NextIT ...... 18! Nuance Communications ...... 19! SpeakToIt ...... 20! TrueKnowlege ...... 21! VirtuOz ...... 22! VoiceBox Technologies ...... 23!

Tables Figure 1: The PVA Life-Cycles ...... 3! Figure 2: Siri's Direct Competitors ...... 4! Figure 3: From the Ranks of Chatbots and NLP ...... 9! Figure 4: Enterprise-based Initiatives ...... 12!

For Information on Ordering the Full Report Contact: Pete Headrick (415) 904-7666

or e-mail: [email protected]