Amazon’s attempts to profit from its Alexa-enabled devices have reportedly led to significant financial losses, amounting to over $25 billion from 2017 to 2021, according to the Wall Street Journal. The losses stem from its Echo, Kindle, and other devices, despite the company having hundreds of millions of customers. Internal documents suggest that many users primarily utilize Alexa-enabled speakers for basic tasks, like setting alarms, rather than for purchasing products on Amazon.
As Amazon’s chief executive, Andy Jassy, seeks solutions, the company is reportedly introducing a paid version of its voice assistant. However, some engineers involved in the project have expressed doubts about its potential effectiveness.
An Amazon spokesperson stated that the company is focused on creating value for customers through its services, not just device sales, claiming that their Devices & Services organization has successfully established profitable ventures.
Additionally, concerns have emerged regarding the new artificial intelligence-powered version of Alexa, which was showcased in September. Former employees have indicated that the AI upgrade is far from ready due to a lack of necessary data and access to suitable processing chips. Amazon has supposedly shifted its priorities towards developing generative AI for its cloud services, Amazon Web Services.
In response, Amazon refuted claims made by former employees, asserting that its Alexa AI team has the resources needed, including proprietary Trainium chips and Nvidia GPUs. The company emphasized its ongoing commitment to creating what it envisions as the best personal assistant available.