Virgin Media O2 has transformed its customer service operation using AI, cutting call transfers by 1.3 million in 2025 and saving customers a collective 400,000 hours of time on the phone.
The UK telecom giant announced the milestone this week, crediting a combination of Natural Language Understanding (NLU) technology, restructured support teams, and comprehensive staff training for the improvement.
How it works
Previously, customers calling Virgin Media or O2 would navigate a menu system by pressing numbers on their phone. If their query didn't fit neatly into the options, or they had multiple issues, they'd often get transferred between teams — a frustrating experience that wasted everyone's time.
Now, most customers simply explain their issue at the start of the call. The AI system interprets what they need and routes them directly to an agent who can help. Virgin Media O2 plans to extend this across all customer journeys in the coming months.
The company also used data heatmaps to identify where high volumes of transfers were happening and why. Based on those findings, they simplified team structures and cross-skilled 5,000 employees to handle a broader range of queries. Fewer handoffs, faster resolutions.
The results speak for themselves
According to Virgin Media O2's announcement, complaints to Ofcom about the company have fallen by more than 50% over the past 12 months. That's a significant turnaround for a company that has historically faced criticism for customer service.
Alan Stott, Virgin Media O2's Director of Customer Contact, said the company aims to make every interaction as simple and efficient as possible: "Where a customer does need to speak to us, we want to make their experience as simple, efficient and productive as possible."
Why this matters for UK tech
This is a practical example of how AI is being deployed right now, not in some distant future, but in everyday operations that affect millions of people.
The UK has positioned itself as Europe's leading AI hub, attracting over £45 billion in committed AI investment. While much of the conversation focuses on frontier models and billion-dollar funding rounds, the real transformation is happening in applications like this: using AI to solve mundane but costly problems.
For founders building in the AI space, Virgin Media O2's approach offers a blueprint. They didn't replace human agents, they made them more effective. The AI handles routing and intent recognition; humans handle the actual problem-solving.
With UK AI startups raising record amounts of venture capital, accounting for 30% of all British VC funding in 2025 we'll likely see more companies applying similar strategies to customer service, logistics, and operations.
The winners won't just be the companies building AI. They'll be the ones deploying it smartly.
