Amazon’s attempts to monetize its Alexa-enabled devices have reportedly been unsuccessful, resulting in significant financial losses for the company. According to a report from the Wall Street Journal, internal documents reveal that Amazon lost over $25 billion from its Echo, Kindle, and other devices between 2017 and 2021. While the company boasts hundreds of millions of customers using these devices, the Echo speakers are primarily utilized for basic tasks such as alarm setting rather than shopping on Amazon.
A former senior Amazon employee expressed concerns, stating, “We worried we’ve hired 10,000 people and we’ve built a smart timer.”
In response, Amazon CEO Andy Jassy is reportedly seeking solutions and plans to introduce a paid version of its voice assistant. However, some engineers involved in this project have expressed doubts about its potential effectiveness, according to the Wall Street Journal.
An Amazon spokesperson emphasized the company’s commitment to creating value through its services rather than just focusing on device sales. They stated, “Our Devices & Services organization has established numerous profitable businesses for Amazon and is well-positioned to continue doing so going forward.”
Additionally, reports suggest that Amazon’s new AI-powered version of Alexa, showcased in September, is still far from ready. Former employees claim that the company lacks sufficient data and necessary chips to support the large language model driving the new assistant. Furthermore, Amazon has reportedly shifted its priorities to concentrate on developing generative AI for its cloud computing division, Amazon Web Services.
In response to these concerns, Amazon asserted that its former employees are mistaken regarding the current status of its Alexa AI initiatives and that the Amazon Artificial General Intelligence team has access to both in-house Trainium chips and Nvidia GPUs. The company reiterated its goal to develop “the world’s best personal assistant.”