Amazon’s efforts to generate revenue from its Alexa-enabled devices have not succeeded, resulting in substantial financial losses for the company.
According to reports, Amazon lost over $25 billion on its Echo, Kindle, and other devices between 2017 and 2021. Despite having hundreds of millions of customers, Alexa-enabled devices are primarily used for basic tasks like setting alarms rather than shopping on Amazon.
A former senior Amazon employee expressed concerns, stating, “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, which includes the introduction of a paid version of Alexa. However, there are concerns among engineers that this new version may not significantly impact the situation.
An Amazon spokesperson emphasized that the company is focused on creating value through its services and has established several profitable ventures within its Devices & Services organization.
On a different note, Amazon’s new AI-powered Alexa, introduced in a recent demo, is reportedly not ready for launch, as the company lacks sufficient data and necessary chips for its advanced language model. Additionally, Amazon has shifted its focus towards generative AI for its cloud computing division, Amazon Web Services.
In response to criticisms from former employees, Amazon maintains that they have access to the essential technology to continue developing Alexa and are committed to creating the world’s best personal assistant.