Amazon’s efforts to generate revenue from its Alexa-enabled devices have reportedly fallen short, leading to losses of over $25 billion from its Echo, Kindle, and other products between 2017 and 2021, according to internal documents and sources familiar with the situation, as reported by the Wall Street Journal. Despite having hundreds of millions of customers, the primary use of Amazon’s Echo speakers appears to be for basic functions like setting alarms rather than shopping.
A former senior employee expressed concerns about the company’s workforce and product development, highlighting the disconnect between expectations and results. In response to the situation, Amazon CEO Andy Jassy is reportedly exploring a paid version of its voice assistant. However, there are doubts among some engineers about the effectiveness of this new offering.
An Amazon spokesperson stated that the company focuses on the value created for customers through its services and highlighted that its Devices & Services division has established profitable ventures.
Additionally, Amazon’s newly developed AI-powered Alexa, which was showcased in September, is said to be unprepared for launch, based on accounts from former employees who indicated that the company lacks sufficient data and the necessary chips to support its advanced language model. Meanwhile, Amazon has shifted its priorities to enhance its generative AI capabilities in its cloud computing division, Amazon Web Services.
In response to these criticisms, Amazon refuted claims from former employees, asserting that its Artificial General Intelligence team has access to the required Trainium chips and Nvidia GPUs, and reaffirmed its commitment to developing the best personal assistant in the market.