Amazon’s ambitions to generate revenue from its Alexa-enabled devices have reportedly fallen short, resulting in significant financial losses for the company estimated at over $25 billion between 2017 and 2021. Internal documents and sources familiar with the situation revealed to the Wall Street Journal that despite boasting hundreds of millions of customers, Alexa-enabled Echo devices are primarily being used for simple tasks like setting alarms rather than for making purchases.
A former senior Amazon employee expressed concerns regarding the workforce and resources allocated, noting, “We worried we’ve hired 10,000 people and we’ve built a smart timer.” In response to these challenges, CEO Andy Jassy is reportedly exploring the introduction of a paid version of Alexa. However, some engineers have voiced skepticism about the potential effectiveness of this new model.
An Amazon representative emphasized the company’s focus on adding value for customers beyond sales of devices, remarking that the Devices & Services division has successfully established several profitable ventures.
Additionally, reports indicate that Amazon’s new AI-enhanced version of Alexa, showcased in a September demonstration, is not yet ready for deployment. Insiders claim that the company lacks sufficient data and the necessary technology to support the new large language model behind the virtual assistant. Furthermore, Amazon has reportedly shifted its priorities to concentrate on generative AI development for its cloud services branch, Amazon Web Services.
In response to these claims, Amazon asserts that its former employees are misinformed regarding the company’s AI initiatives. They clarified that the Amazon Artificial General Intelligence team has access to essential resources, including their proprietary Trainium chips and Nvidia GPUs, reaffirming their commitment to developing an exceptional personal assistant.