It’s been a rough week in the major dailies for Big Tech customer service departments.
First, the New York Times’ Tripped Up column put Lyft on blast Thursday for poor communications with a rider who was banned from the app for no apparent reason and couldn’t get an explanation for the decision.
Then, on Monday, a double-barrel of bad press.
The Washington Post reported on Facebook users unsuccessfully fighting with the Meta unit to regain access to their hacked accounts, a long-standing problem that doesn’t appear to be getting any better. Meanwhile, the Wall Street Journal found Amazon—a company “defined by its obsession over customers”—has seen its stellar consumer satisfaction figures sag a bit, with analysts and former employees hypothesizing that service slippage might be partially to blame.
The dispatches shine some dim light on a still-salient but frequently overlooked aspect of Big Tech operations, one that feels all the more consequential given the industry’s recession-induced angst.
While some Big Tech giants retain reputations for strong customer service—chief among them: Amazon, Apple, and Samsung—too many tech companies remain disappointingly uncommitted to consumer-facing assistance. A Protocol-commissioned Harris Poll survey published in September showed only 7% of respondents said the tech industry provides the best customer service experience. By comparison, the financial services, health services, travel and hospitality, and retail and consumer goods industries each earned 10%-plus of the vote.
In a blog post earlier this month, Gergely Orosz, a former Uber and Skype employee and the author of the popular blog Pragmatic Engineer, attributed Big Tech’s low customer service ratings to a few symptoms and causes.
Orosz wrote that an overreliance on machine learning often led to unnecessary actions on accounts, such as suspensions or fraud alerts (see: the Post’s Facebook report). At the same time, the everyday proliferation of bugs chipped away at the user experience.
These problems are often easy enough to fix—with the right investment in customer service. But Orosz argued that some tech companies bent on maximizing business impact see customer service as a financial loser, particularly when it involves labor-intensive call centers. As a result, they lean heavily on chatbots, help pages, and other impersonal tools to solve routine problems. Orosz cited Google as a prime offender in this regard.
“Most of Big Tech is going down the same path Google has chosen,” Orosz wrote. “Build self-service systems and minimize the customer support surface. Even when offering customer support, limit the surface area, and have no incentives for engineers to tackle one-off customer problems.”
Orosz went on: “And you know what? Not investing much in customer support is profitable. Google, Meta, and other companies following the self-service automation model are doing great profit-wise. So much that companies which have historically offered good customer support are cutting down on these costs.”
Analysts at Gartner backed up Orosz’s observation earlier this summer, publishing forecasts that show “conversational artificial intelligence” products, such as voicebots and chatbots, will reduce call center labor costs by $80 billion by 2026.
While the financial case for scaling back on customer service might be sound, a few arguments remain for a reinvestment in some personal touch.
The same Protocol-Harris Poll survey showed 70% of respondents still preferred “real-time communication” as their method of connecting with customer service, compared to 7% choosing chatbots. About 90% of respondents deemed video conferences and phone calls as “very useful” or “somewhat useful,” compared to 74% of respondents using chatbots.
I would also argue that customer service will take on greater importance amid our current tech malaise.
Whereas consumer tech once felt fresh and exciting, we’re now entering an era of comparatively stagnant development. Smartphones, apps, and social media have reached a maturation point, while newer tech like virtual reality, autonomous vehicles and all things Web3 still feels years away from going mainstream. The Atlantic’s Derek Thompson explored this theory last week, positing that the tech industry is “experiencing a midlife crisis.”
In the absence of novel products, we rightly expect that our established, incrementally improving tech will work seamlessly. And when it doesn’t, easy fixes should be a phone call or expeditious email away.
Want to send thoughts or suggestions to Data Sheet? Drop me a line here.
Jacob Carpenter
NEWSWORTHY
Ready for a close-up. The U.K.’s antitrust watchdog announced an in-depth market investigation Tuesday into Apple and Google over their dominance of mobile operating systems, Politico EU reported. The probe follows an initial inquiry that found 97% of all mobile phones in the U.K. used web browsers owned by Apple or Google, as well as complaints from developers about strict app store rules employed by the companies. The U.K.’s Competition and Markets Authority could order corporate changes or make recommendations for new government regulations following its investigation, which must wrap up within 18 months.
The worst is over? New Twitter owner Elon Musk told employees during an all-hands meeting Monday that the company is finished with layoffs after cutting its workforce down from roughly 7,500 to 2,700 staffers in recent weeks, The Verge reported. Musk added that the company is actively recruiting for engineering and sales staff after eliminating thousands of positions he deemed extraneous. In a separate development, Bloomberg reported that leaders of several civil rights leaders who met with Musk earlier this month are now calling on advertisers to abandon the platform, arguing that Musk broke promises he made to them about content moderation.
Living the high life. FTX executives and the parents of former CEO Sam Bankman-Fried bought 19 properties valued at $121 million in the Bahamas over the past two years, the latest example of excessive spending by the tarnished crypto company, Reuters reported Tuesday. The purchases included luxury beachfront property deemed a “vacation home” in land records by Bankman-Fried’s parents, as well as seven condominiums costing about $10 million each. FTX officials wrote in bankruptcy filings last week that the company used corporate funds to buy homes and other personal items for employees and advisors.
Trying to stop an exodus. Cryptocurrency lender Genesis Global Capital is soliciting investments designed to shore up its teetering finances following the demise of FTX, the Wall Street Journal reported Monday. The outfit has tried to raise cash from Binance, the world’s largest crypto exchange, and private equity titan Apollo Global Management, but neither organization has agreed to invest. Genesis officials said they have “no plans to file bankruptcy imminently,” though industry analysts worry that the FTX debacle has ruined the lender’s balance sheet.
FOOD FOR THOUGHT
All atwitter for nothing? Don’t hold your breath for a Big Tech giant trying to rip off Twitter. Axios reported Tuesday that Google, Meta, and Microsoft are unlikely to launch anything resembling a Twitter clone in light of Elon Musk’s scattershot takeover of the platform. Armchair Twitter pundits have hypothesized that tech outfits might seize a market opportunity to replicate the platform, particularly given Madison Avenue’s skittishness with Musk. However, Twitter’s business is relatively small potatoes for today’s budget-conscious tech giants, who don’t want to assume the costs and headaches that come with starting a global social media platform from scratch.
From the article:
Cloning Twitter would not be a huge technical challenge for companies like Microsoft, Google and Meta that already have a massive cloud infrastructure.
Yes, but: For these companies, a Twitter-like service would bring big political, social and legal headaches with little promise of a financial payoff.
Sources at Meta, Google and Microsoft suggest that they have no appetite for building a Twitter alternative.
IN CASE YOU MISSED IT
Inside Sam Bankman-Fried’s extravagant penthouse lifestyle in the Bahamas, where the T-shirt-clad FTX founder lived like royalty, by Leo Schwartz
Elon Musk delays Twitter verification rollout indefinitely and is now considering different color check marks, by Sophie Mellor
Tech companies have laid off over 120,000 employees this year. Here’s how their severance packages compare, by Paolo Confino
How a Disney senior staff rebellion put the final nail in Bob Chapek’s CEO coffin, by Christiaan Hetzner
3 venture investors on where they’re looking to invest in crypto now, by Anne Sraders
Tesla’s shares hit a two-year low as investors worry about Elon Musk’s focus on Twitter and a growing list of bad news, by Esha Day and Bloomberg
Why Amazon is going all in on renewables–and how it intends to use 100% clean energy by 2025, by Shannon Kellogg
Composite materials have made Artemis possible. Here’s how innovation is transforming America’s aviation industry, by Carmelo Lo Faro
BEFORE YOU GO
Still a rising star. Alexa might be on the chopping block, but Astro isn’t getting jettisoned just yet. Insider, citing an internal email, reported Monday that Amazon’s team of 900-plus employees working on the company’s Astro home robot looks like it’s been spared from cutbacks at the tech conglomerate. The decision signals Amazon’s interest in building out the household device, which isn’t yet widely available for purchase. Amazon announced layoffs expected to total about 3% of its corporate workforce earlier this month, with unprofitable divisions like Alexa-based hardware units feeling the biggest brunt. However, an Amazon executive told Astro-focused employees that the company is “committed to the future of consumer robots.”
