Mobile App Evolution: Messaging Apps, Artificial Intelligence-Fueled Chatbots

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We are entering a new digital era – we will use less stand-alone apps and instead access apps within app platforms, like Facebook Messenger, Slack and WeChat. We will interact with apps using chat, or the Conversational User Interface (CUI). Most of these apps will be smart, nimble applications called Chatbots. Chatbots can initiate actions and respond to requests. In my new report, Chatbots: The Rise of the Conversational User Interface http://bit.ly/1MXLiOI , the impact of Chatbots is explored. Chatbots will not truly come to power until they become smart, and they become smart through the use of Artificial Intelligence (AI).

The AI game is shifting, and AI applications are poised for mass market adoption. Here is an excerpt from the Chatbot report concerning AI:

The field of AI has accelerated in the last few years. AI programs are smarter, learning faster, and becoming more affordable and accessible to developers. The most sophisticated AI is best suited for image recognition, text analysis, time-series data (like stock price action) and fraud detection. Chatbot developers are beginning to leverage these capabilities.

First, a quick primer on terms in AI:

Artificial Intelligence:

Umbrella term used to describe the capability of a machine to imitate intelligent human behavior. In complexity, AI moves from machine learning to deep learning/neural networks.

Machine Learning:

Explores the study and construction of algorithms that can learn from and make predictions on data. The program must be “taught” by engineers to learn to perform tasks.

Deep Learning:

More sophisticated branch of machine learning in which the algorithms are better at learning, adapting on their own with less teaching from engineers.

Artificial Neural Networks (ANNs):

Machine learning inspired by biological neural networks (particularly brain), used to estimate or approximate functions that depend on a large number of inputs and are generally unknown. The most sophisticated deep learning taps into ANNs.  

The most sophisticated initiatives involving algorithms that learn on their own like a human brain (deep learning using ANNs) were until recently, the purview of players like Google, Baidu, Facebook and Microsoft who have the computing power/GPUs to run them. But in the last year, there has emerged a significant movement to democratize deep learning neural networks, which means a great deal of third parties outside of the computing giants can begin to access the computing power to build smarter apps, like chatbots.

In June 2014, a startup called Skymind http://www.skymind.io launched the first commercial-grade open source distributed deep learning library written for Java called Deeplearning4J (DL4J) http://deeplearning4j.org . The initiative means that deep learning software can be built in Java and can run on top of Hadoop. Oh, and by the way, DL4J is partially funded by WeChat parent company Tencent.

Within weeks of each other in November-December, 2015 three deep neural network PAAS services were launched – Minds.ai http://minds.ai , Metamind https://www.metamind.io and Google’s TensorFlow https://www.tensorflow.org 

Mark Beccue Consulting predicts smart, AI-powered chatbots will be in widespread enterprise and consumer use by mid-2017.

 

Chatbots: The Rise of the Conversational User Interface

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The 13-page research report, Chatbots: The Rise of the Conversational User Interface, is now available for purchase. Details for purchasing the research note or for analyst inquiry below.

Excerpt from executive summary:

We are drowning in data. Today there is so much data produced, it is impossible to consume or leverage it to the best of our capabilities. In work, we fail to parlay the vast amount of data available into increased work efficiency or production. In our personal lives, we mentally shut down in attempts to process news or social information, buy things or deal with a plumber.

Part of our data consumption problem is form. The graphical user interface with its start command and drop-down menus worked well in the PC era, but not so much anymore. In a mobile-first world, our devices don’t have start menus or expansive screens. Search is not smart enough. We need smarter applications that fully understand what we are looking for or an action we want to take. The most logical interface to meet these needs is one that is dialog based. You tell your device what you want, either by voice or text. If an application is confused, it will ask for clarification to modify. In this way, which is natural to humans, humans and computers will work better together. This is the Conversational User Interface (CUI).

Our internet experience to date has been to pull information we want, but we are on the cusp of switching to a model where desired information is pushed to us instead.

We are on the cusp of a more efficient life, fueled by useful data. We will work better and live easier because of smarter applications that understand our intent and can analyze the data available. We will reach this new world through the growing use of the conversational user interface and chatbots.

Key to the evolution to CUI are smart, nimble applications called Chatbots. Chatbots, also known as messaging bots, are computer programs that operate through a chat interface. They can initiate action and respond to requests. Chatbots have the ability to act proactively, but remain invisible otherwise.

Chatbots will:

  • Leverage the most sophisticated computer science – deep learning and neural networks – yet we will easily interact and guide them using the Conversational User Interface (CUI) of text/chat.
  • Curate our news, schedule our days, take care of our customer service issues, find, schedule and pay plumbers.
  • Replace most stand alone mobile apps, disrupt search, bring true context to marketing, improve workplace and personal life efficiency, and open the door for new digital tycoons

 

Chatbots: The Rise of The Conversational User Interface

Research report, $ 60

1-hour analyst inquiry session, $ 150

Order by credit card here Chatbots

Whatsapp Poised To Lose Ground In India

The world’s largest messaging app Whatsapp hit 900 million MAUs in September. Facebook should admire that number while they can, because Whatsapp is going to start trending down by 3Q 2016. Why? Because India has personal assistant fever, and Whatsapp does not.

Messaging apps are morphing into platforms, with wunderkind WeChat showing how its done, connecting businesses large and small to consumers. Yet Tencent’s success has been largely limited to China and a handful of other countries, and certainly not in India, where Whatsapp dominates the market. Whatsapp is famously not a platform yet. Medianama estimates Whatsapp MAUs in India are between 100 and 120 million.

The massive Indian market for almost any product or service is enormously fragmented. Hyper local assistance, whether for finding a dentist or takeout delivery, is in great demand.

For the past two years, Indians have been busy trying to use Whatsapp creatively to solve business problems the way WeChat has – jerry-rigging Whatsapp accounts to serve as a customer service channel, marketing channels, commerce channels. There are Indian consultancies just for helping businesses to market via Whatsapp. Businesses as diverse as web developers (NowFloats) to skincare consultants (JustHerbs) and concierge services (Russsh) are using Whatsapp for as a customer support and booking platform. But the limitations for group chat of 100 or less is curbing the effectiveness of Whatsapp as a broadcast marketing tool. It is likely that Facebook will introduce ways to make it easier for businesses to engage with customers, but Whatsapp does not have a natural tie to the business pages in Facebook that Facebook Messenger does, so look for Facebook to at some point introduce more creative, stand alone tools for business engagement, such as bots and personal assistants or other apps within the app, in the manner of WeChat.

In this vacuum of unmet consumer demand for hyper local business connection, a host of home-grown, chat-based mobile personal assistants are jockeying to grab messaging market share. There are at least 10 with a shot of making it on their own outside of Whatsapp and eroding Whatsapp’s grip on the Indian messaging market:

Haptik pivoted in January from a customer support tool to a broad spectrum personal assistant that can top up your mobile account, file a service request with a business, make a restaurant reservation, handle your flight check in and check movie listings just to name a few tasks. More than 500,000 consumers are using it today in 102 cities.

Goodservice focuses on connecting consumers with local businesses like plumbers & electricians, but can book your travel and deliver food and other items as well.

Helpchat an all-purpose personal assistant, acquired Niffler, an company that has built an artificial intelligence engine in September and now uses AI to learn user habits to offer curated deals. It’s backed by Sequoia.

MagicTiger Users interface via chat with MT representatives who go and do on MT’s users behalf.

Lookup Users interact directly with businesses via chat.

Others include AI-powered chatbot Niki, Yellow , Goodbox , Ratan Tata-backed Urbanclap and Joe Hukum.

One huge challenge for any of these platforms is scale. Some are human powered only, which will be impossible to maintain for any India-wide service. Most are automating using chatbots (more in depth research coming from me on that). Bots are lightweight, cross-platform apps that interact with users via a chat interface. Many bots are hard-coded applications that look at keywords to initiate responses and actions. However, many of the Indian personal assistant startups (I know of at least 5) are using artificial intelligence engines to run their personal assistants.

Bots are key to the success of the Indian personal assistants and they give these newcomers a distinct opportunity to erode Whatsapp’s market share. Over the next year, several of these personal assistants will succeed if Facebook/Whatsapp doesn’t counter and allow either third party personal assistants to launch bots on Whatsapp or Facebook launches their own on Whatsapp. That would take a lot of legwork, given the fragmented market in India.

This platform battle in India is a potential harbinger of things to come for other markets. Will messaging apps be personal assistants? Media channels? Neither, both? The Indian market is also where we will see rapid development and evolution of the interface of the future, the Conversational User Interface – fueled by bots and new forms of artificial intelligence – machine learning all the way to deep learning and neural networks.