Amazon’s efforts to generate revenue through its Alexa-enabled devices have reportedly resulted in significant losses, totaling over $25 billion between 2017 and 2021. This information comes from internal documents and sources familiar with the company’s operations, according to the Wall Street Journal. Although Amazon boasts hundreds of millions of customers using its devices, the Echo speakers are primarily utilized for simple tasks like setting alarms rather than for shopping.
A former senior employee expressed concerns regarding the company’s investments, remarking, “We worried we’ve hired 10,000 people and we’ve built a smart timer.” In response to these challenges, Amazon CEO Andy Jassy is reportedly exploring solutions, including a forthcoming paid version of its voice assistant. However, engineers involved in this project are concerned that it may not significantly impact overall usage.
An Amazon spokesperson defended the company’s approach, stating, “We focus on the value we create when customers use our services, not just when they buy our devices,” and emphasized that its Devices & Services organization has established various profitable ventures.
In addition, Amazon’s recently unveiled AI-enhanced version of Alexa is reportedly far from completion, as former employees indicated that the company lacks sufficient data and necessary hardware to support the large language model driving its advancement. Reports suggest that Amazon has shifted its focus from the AI-powered Alexa to invest more in generative AI for its cloud computing branch, Amazon Web Services.
Amazon countered these claims, asserting that former employees are misinformed. The company stated that its Artificial General Intelligence team has access to both proprietary Trainium chips and Nvidia GPUs, maintaining that the objective for Alexa remains to develop the best personal assistant available.