Deutsche Telekom’s Magenta Voice Assistant – An Innovation Journey
The path to innovation is rarely linear. There are steps forward and backward, twists and turns. However, each step provides information about the technology, customer needs, competitive offerings, product economics, and the attractiveness of various applications. Deutsche Telekom is a company built on innovation. We understand how this works.
The Magenta Voice Assistant’s innovation journey is instructive in this regard. Deutsche Telekom led with industry firsts, introduced products, discontinued products, enhanced other services, and refined our focus around key areas of customer value. And the innovation continues. At Mobile World Congress new week, we will introduce a new voice product that will continue the journey. To put this in context, it will be helpful to review Deutsche Telekom’s voice assistant journey.
In early 2018, Deutsche Telekom announced the beta launch of the Telekom Smart Speaker. The net promoter score (NPS) from our alpha customers was initially very low. We switched the technology providers for the entire voice processing chain within a span of 6 months. We finally launched the smart speakers on September 6, 2019 at the IFA Fair in Berlin. At the time of the launch, we had improved the NPS by 61 points compared to the alpha tests.
Deutsche Telekom launched our second smart speaker – the colorful Mini speakers – in June 2020. We continued to further expand the benefit of our speakers with more daily voice skills like local venues, wellness, children’s stories, an Advent calendar and many other features. We were proud of launching new voice skills to our users. However, users did not regularly employ them as much as we would have liked.
The smart speaker business had become highly competitive with the market leaders in smart speaker category flooding the market with devices at extremely low prices. At this point, we had to come to a decision on the future of our smart speakers. In January 2021, we discontinued the sales of our smart speakers.
Ultimately, the market as well as the customers determine the way forward for a product. We had launched a good innovative product, the first smart speaker worldwide to host truly parallel assistants – Magenta and Alexa — but we did not manage to excite a relevant number of customers. However, our experience building the German voice assistant laid the foundation for everything that would follow.
After the mini speakers launched, we took a step back and asked ourselves: what is our strategy moving forward? We came up with our flywheel strategy for voice assistant growth. The strategy was not specific to our assistant, hence we decided to share it with the world with an article published in Voicebot.ai in 2021.
Our priority was no longer hardware. It became the Magenta Assistant software. We streamlined our focus to Telekom customers of Magenta TV, and the fixed & Mobile telephony networks, as well as key domains (TV control, Smart home, Router control, Telekom service, Mobile & Landline telephony), while dramatically lowering costs.
Those changes led to the first voice remote control for our Magenta TV set-top box introduced in December 2020. Our beta customers gave us an excellent NPS from the start. By 2022, the NPS increased further, rising to be on par with voice remote controls from competitors and winning the IF design award for Product UX.
Our consumer products are built on a powerful modular voice AI platform. Hence, we could quickly modify individual components to provide best fit for different market requirements. In September 2022, we launched our first B2B voice product, Terminfinder, in the German market. Terminfinder brings our voice assistant to the landline and solves the problem of booking appointments for businesses. Working in tandem with partners like Cituro and TerminLand, providers of scheduling software, our assistant comes in handy for a large population in Germany that still prefers picking up the phone to book an appointment.
Along the way, we have globally expanded our product teams to Greece and India to complement our German team. Through various mechanisms focused on operational effectiveness, we were able to reduce the overall development and operational costs year over year to a reasonable level that justifies the business impact.
Onwards and Upwards
Product Innovation is hard and unpredictable. We try things out, we learn from mistakes, and we are agile enough to pivot. We do not give up but learn every day. We move with the market to meet the needs of our customers. Our journey is a real world example of how the innovation cycle works.
Deutsche Telekom’s original vision remains unchanged since 2018: “With our voice assistant, we are helping our customers simplify their everyday life”. And our journey towards voice assistant growth continues.
To learn more about where we are headed, don’t miss my panel talk at Mobile World Congress Barcelona (27th Feb 9:30 AM), “Voice Assistants, what’s next?” with Bret Kinsella, Founder & CEO of Voicebot.ai and Hanna Rieke, VP Magenta Home at Deutsche Telekom. This is truly an exciting period of innovation for voice assistants for enterprises, the smart home, and new consumer applications.
We will also unveil a sneak preview of another interesting use case – smart call assistant on the mobile phone at MWC. This is a practical solution to an everyday problem and is yet another incarnation of the Magenta Voice Assistant on the mobile phone. I hope to see you in Barcelona!
Reghu Ram Thanumalayan is the senior vice president of the Magenta Voice Program at Deutsche Telekom.