Amazon’s efforts to monetize its Alexa-enabled devices have apparently resulted in significant financial losses, totaling over $25 billion from 2017 to 2021, according to recent reports. Internal documents and sources familiar with the situation, as reported by the Wall Street Journal, indicate that despite having hundreds of millions of customers, the primary use of Amazon’s Echo speakers is for setting alarms and utilizing free apps, rather than for shopping on the platform.
A former senior employee expressed concern, stating, “We worried we’ve hired 10,000 people and we’ve built a smart timer.” In response to this challenge, Amazon CEO Andy Jassy is reportedly seeking solutions and considering the introduction of a paid version of the voice assistant. However, some engineers involved in this project remain skeptical about its potential impact.
An Amazon spokesperson emphasized the company’s focus on the value derived from customer engagement with its services, rather than solely from hardware sales. They noted that the Devices & Services division has been successful in establishing profitable ventures and is poised for future growth.
Additionally, there are reports suggesting that Amazon’s latest AI-enhanced version of Alexa, which was previewed in September, is far from ready. Former employees have indicated a lack of necessary data and access to essential chips for running the large language model that would power this new assistant. Instead, Amazon is allegedly prioritizing generative AI development for its cloud computing segment, Amazon Web Services.
In response to these claims, Amazon has stated that the assertions of previous employees are inaccurate, asserting that the Amazon Artificial General Intelligence team has access to both proprietary Trainium chips and Nvidia graphics processing units. The company’s objective for Alexa remains to create the best personal assistant in the world.