Amazon’s efforts to profit from its Alexa-enabled devices have reportedly fallen short, leading to losses of over $25 billion between 2017 and 2021, as highlighted in a Wall Street Journal report referencing internal documents and anonymous sources. Although Amazon boasts hundreds of millions of customers for its devices, users mostly utilize Alexa-enabled Echo speakers for tasks like setting alarms and accessing free applications rather than making purchases on Amazon.
Concerns were raised by a former senior employee who noted, “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 seeking solutions, with plans to introduce a paid version of its voice assistant. However, some engineers reportedly doubt that this new model will yield significant results.
An Amazon spokesperson emphasized the company’s focus on creating value through its services, stating, “Our Devices & Services organization has established numerous profitable businesses for Amazon and is well-positioned to continue doing so going forward.”
In another update, Amazon’s new AI-powered version of Alexa, introduced in a demo in September, is said to be far from ready, according to former employees. The company reportedly lacks sufficient data and access to the necessary chips to operate the large language model that underpins the new assistant. Additionally, it has prioritized the development of generative AI for its cloud computing division, Amazon Web Services, over the new Alexa.
Amazon responded to these claims, asserting that its former employees are mistaken and that the Amazon Artificial General Intelligence team has access to both proprietary Trainium chips and Nvidia GPUs. The company’s goal for Alexa remains unchanged: to develop the world’s best personal assistant.