Amazon’s attempt to generate profit from its Alexa-enabled devices has reportedly fallen short, resulting in losses exceeding $25 billion between 2017 and 2021. Internal documents and unnamed sources revealed to the Wall Street Journal that despite Amazon’s extensive customer base, many Echo and Kindle users primarily utilize these devices for basic functions like setting alarms rather than for shopping on Amazon.
A former senior employee expressed concerns about the apparent disconnect, stating, “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 exploring solutions, including the introduction of a subscription model for its voice assistant. However, certain engineers have expressed skepticism about its potential effectiveness.
An Amazon spokesperson clarified that the company is “focused on the value we create when customers use our services, not just when they buy our devices.” They noted that the Devices & Services organization has successfully established multiple profitable businesses and is optimistic about future prospects.
On another note, Amazon’s new AI-powered version of Alexa, showcased in September, is reportedly not yet ready for launch, according to former staff. They indicated that the company lacks sufficient data and access to the necessary hardware to support the advanced language model behind the new assistant. Furthermore, it seems that Amazon has shifted its focus towards generative AI initiatives within its cloud computing division, Amazon Web Services, rather than on enhancing Alexa.
In defense of its efforts, Amazon asserted that the claims made by former employees are inaccurate, emphasizing that its Artificial General Intelligence team has access to essential resources, including in-house Trainium chips and Nvidia GPUs. The company remains committed to its goal of creating the world’s premier personal assistant.