Amazon’s efforts to monetize its Alexa-enabled devices have reportedly resulted in significant financial losses, shedding over $25 billion from 2017 to 2021, according to internal documents and sources familiar with the situation. Despite having hundreds of millions of customers, the Echo speakers are mainly used for basic functions like setting alarms rather than for making purchases.
A former senior Amazon employee expressed concerns about the company’s investment, noting the workforce expansion and the development of what they described as a “smart timer.” In response to the mounting challenges, Amazon CEO Andy Jassy is exploring a solution, with plans to introduce a paid version of its voice assistant. However, some engineers are skeptical about the potential impact of this new offering.
An Amazon spokesperson stated that the company focuses on the value provided to customers, emphasizing that its Devices & Services division has successfully established profitable ventures.
Meanwhile, Amazon’s updated AI-powered Alexa, which was showcased in September, is reportedly far from completion due to insufficient data and a lack of access to necessary technology. The company has pivoted its focus towards generative AI development for Amazon Web Services, deprioritizing the Alexa project.
Amazon has countered claims from former employees, asserting that the Amazon Artificial General Intelligence team has access to necessary hardware and remains committed to creating a top-tier personal assistant.