Since August 2026, Article 50 of the EU AI Act has been enforceable. This means that if your business that if EU customers can reach your customer-facing AI, disclosure is now a legal requirement. There's been a lot of confusion about this because of the Digital Omnibus, which came into force in July 2026, deferring the high-risk obligations element to December 2027, generating a wave of coverage about "delays" to the EU AI Act. But the reality is that Article 50 is now here and the penalties for non-compliance can be significant.
Employment of customer service reps in the US has declined almost 5 percent for two years in a row. This is a measurable decline but nowhere near the "customer service agents will disappear entirely" narrative that has been regularly touted. Forrester's view is that AI is disrupting the old rule of more contacts = more people needed to handle them, which is changing how teams are shaped. Gartner goes even further, predicting that half of the companies that have cut roles in the name of AI will be rehiring by 2027. Either way, what's clear is that organizations are rearranging the workforce.
When we asked our network how they acquired new AI capabilities in 2025, 74 percent said they worked with third-party vendors. In 2026, that figure has fallen to 50 percent. That is a significant shift in a single year and reflects the complexity in the AI vendor market. Functionality across vendors has converged and differentiation is largely about pricing and integration capabilities. Consolidation, too, is increasing, with several high-profile acquisitions in 2026. In this market, buyers are right to be more cautious. Building, however, is not the straightforward alternative. Once a concept has been built, most organizations simply don't have the capacity or internal expertise to scale or maintain the systems.
CX leaders are increasingly being asked by legal, security and boards where customer data is stored and processed and under which jurisdiction. Most, however, cannot confidently answer that question when it comes to the agentic AI vendors they are evaluating. Deloitte's 2026 State of AI in the Enterprise report found that 77 percent of companies now factor an AI solution's country of origin into vendor selection and that 58 percent now use local vendors. Especially for UKI and European CX teams, choosing between larger, US-headquartered providers is more complex than ever, and smaller, locally-based vendors are gaining an advantage.