Amazon’s attempts to profit from its Alexa-enabled devices have reportedly resulted in significant losses, amounting to over $25 billion between 2017 and 2021, according to the Wall Street Journal, which cited internal documents and sources familiar with the situation. Despite having hundreds of millions of customers using its devices, it appears that many use Alexa primarily for basic functions such as setting alarms, rather than for making purchases.
A former senior employee remarked on the inefficiencies within the company, highlighting concerns over the workforce dedicated to developing features that do not drive profitability. In response to these challenges, Amazon’s CEO Andy Jassy is reportedly exploring solutions, including the launch of a paid subscription for the voice assistant. However, there are doubts among some engineers about the potential impact of this initiative.
An Amazon spokesperson emphasized the company’s commitment to delivering value through its services, noting that their devices and services division has successfully established several profitable ventures.
On another front, Amazon unveiled a new AI-powered version of Alexa in September, yet former employees claim it is far from ready. The company is allegedly lacking sufficient data and the necessary hardware to support the advanced language model intended for this upgrade. Moreover, sources indicate that Amazon has shifted its focus from enhancing Alexa to developing generative AI for its cloud computing service, Amazon Web Services.
In defense of its current strategies, Amazon asserted that the claims made by former employees are inaccurate and that its Artificial General Intelligence team has access to both proprietary Trainium chips and Nvidia graphics processing units. The company reaffirmed its goal to create the best personal assistant in the world.