Conversational AI spending is going to skyrocket this year – here’s why

LLM/AI jailbreaking concept image showing digitized human brain on mustard yellow background with pixelated parts of the brain flowing away.

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The growth in the use of conversational AI shows no sign of slowing, according to new research, driven by enterprise spending on agentic AI for services.

Analysis from Juniper Research shows that global revenue from conversational AI services is set to grow from $14.6 billion in 2025 to more than $23 billion by 2027.

Behind much of this growth, Juniper noted, is attributed to organizations cottoning on to the benefits to services of implementing agentic AI - a subset of AI which enables solutions to act independently to reach a pre-set objective.

In practice, this allows for the automation of tasks such as service enquiries and appointment scheduling over conversational channels, reducing reliance on intervention from human agents.

In the report, Juniper encouraged conversational AI vendors to capitalize on this trend by integrating agentic AI into their communications technology stack to create solutions that automate customer interactions across messaging channels.

However, to allow agentic AI to manage these interactions right across the customer journey, Juniper warned there will need to be tight integration with the business support systems where customer data is stored.

There should also be careful consideration of the level of autonomy that's given to agentic AI, the report warned, with human oversight of the AI's actions highly necessary during the early stages of implementations.

"Conversational AI vendors must carefully moderate the outputs of agentic AI models during early-stage implementations. Issues around liability arising from hallucinations or erroneous communications must be avoided before enterprises’ trust in agentic AI can be established," said research author Molly Gatford.

"This will best position conversational AI vendors to capitalise on this substantial revenue growth over the next three years."

Agentic AI adoption is surging, but challenges lay ahead

While interest in agentic AI is surging globally, a report last month warned there are challenges ahead for early enterprise adopters.

Research from Pegasystems found that while six-in-ten workers in the US and UK are using AI agents on a daily basis, many don't trust their reliability or quality.

A third told researchers they were worried about the quality of work produced by agents, with a similar number pointing to a lack of human intuition and emotional intelligence.

Notably, three-in-ten said they didn’t trust the accuracy of AI-generated responses, with accuracy and reliability cited as the top priority for improvement in agentic AI tools.

Agentic AI has its dark side too, with researchers from Malwarebytes warning this month of the threat posed by malicious AI agents that can reason, plan, and use tools autonomously.

"With the expected near-term advances in AI, we could soon live in a world where well-funded ransomware gangs use AI agents to attack multiple targets at the same time," the researchers warned.

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Emma Woollacott is a freelance journalist writing for publications including the BBC, Private Eye, Forbes, Raconteur and specialist technology titles.