A virtual assistant is a software agent that can perform tasks or services for an individual. Sometimes the term “chatbot” is used to refer to virtual assistants generally or specifically those accessed by online chat (or in some cases online chat programs that are for entertainment and not useful purposes).
As of 2017, the capabilities and usage of virtual assistants is expanding rapidly, with new products entering the market. An online poll in May 2017 found the most widely used in the US were Apple’s Siri (34%), Google Assistant (19%), Amazon Alexa (6%), and Microsoft Cortana (4%).Facebook’s M is expected to be available to hundreds of millions on Facebook Messenger in 2017. Apple and Google have large installed bases of users on smartphones and Microsoft has a large installed base of Windows-based personal computers (where Cortana works in addition to phones and smart speakers); meanwhile, Alexa was the first to get the ability to place online e-commerce orders, from Amazon.The first tool enabled to perform digital speech recognition was the IBM Shoebox, presented to the general public during the 1962 Seattle World’s Fair after its initial market launch in 1961. This early computer, developed almost 20 years before the introduction of the first IBM Personal Computer in 1981, was able to recognize 16 spoken words and the digits 0 to 9. The next milestone in the development of voice recognition technology was achieved in the 1970s at the Carnegie Mellon University in Pittsburgh, Pennsylvania with substantial support of the United States Department of Defense and its DARPA agency. Their tool “Harpy” mastered with about 1000 words the vocabulary of a three-year-old. About ten years later the same group of scientists developed a system that could not only analyze individual words but entire word sequences enabled by the Hidden Markov Model.Thus, the earliest virtual assistants, which applied speech recognition software were automated attendant and medical digital dictation software. In the 1990s digital speech recognition technology became a feature of the personal computer with Microsoft, IBM, Philips and Lernout & Hauspie fighting for customers. Much later the market launch of the first smartphone IBM Simon in 1994 laid the foundation for smart virtual assistants as we know them today. The first modern digital virtual assistant installed on a smartphone was Siri, which was introduced as a feature of the iPhone 4S on October 4, 2011 Apple Inc. developed Siri following the 2010 acquisition of Siri Inc., a spin-off of SRI International, which is a research institute financed by DARPA and the United States Department of DefenseVirtual assistants can provide a wide variety of services, and particularly those from Amazon Alexa and Google Assistant grow by the day. These include:
Provide information such as weather, facts from e.g. Wikipedia or IMDB, set an alarm, make to-do lists and shopping lists
Play music from streaming services such as Spotify and Pandora; play radio stations; read audiobooks
Play videos, TV shows or movies on televisions, streaming from e.g. Netflix
Buy items from e.g. Amazon
Complement and/or replace customer service by humans. One report estimated that an automated online assistant produced a 30% decrease in the work-load for a human-provided call centre.Digital experiences enabled by virtual assistants are considered to be among the major recent technological advances and most promising consumer trends. Experts claim that digital experiences will achieve a status-weight comparable to ‘real’ experiences, if not become more sought-after and prized. The trend is verified by a high number of frequent users and the substantial growth of worldwide user numbers of virtual digital assistants. In mid-2017, the number of frequent users of digital virtual assistants is estimated to be around 1bn worldwide. In addition, it can be observed that virtual digital assistant technology is no longer restricted to smartphone applications, but present across many industry sectors (incl. automotive, telecommunications, retail, healthcare and education). In response to the significant R&D expenses of firms across all sectors and an increasing implementation of mobile devices, the market for speech recognition technology is predicted to grow at a CAGR of 34.9% globally over the period of 2016 to 2024 and thereby surpass a global market size of USD 7.5 billion by 2024. Taking into consideration the regional distribution of market leaders, North American companies (e.g. Nuance Communications, IBM, eGain) are expected to dominate the industry over the next years, due to the significant impact of BYOD (Bring Your Own Device) and enterprise mobility business models. Furthermore, the increasing demand for smartphone-assisted platforms are expected to further boost the North American Intelligent Virtual Assistant (IVA) industry growth. Despite its smaller size in comparison to the North American market, the intelligent virtual assistant industry from the Asia-Pacific region, with its main players located in India and China is predicted to grow at an annual growth rate of 40% (above global average) over the 2016-2024 period.