Amazon’s efforts to profit from its Alexa-enabled devices are reportedly facing significant challenges, with estimates indicating that the company has lost over $25 billion from its Echo, Kindle, and other devices between 2017 and 2021. This information comes from internal documents and sources familiar with the situation, according to the Wall Street Journal. Despite boasting hundreds of millions of customers for its devices, it appears that many users primarily utilize Echo speakers for basic functions like setting alarms, rather than for making purchases on Amazon.
A former senior Amazon employee expressed concerns regarding the company’s hiring and investment, stating, “We worried we’ve hired 10,000 people and we’ve built a smart timer.” In response to these issues, Amazon CEO Andy Jassy is reportedly working on a solution by introducing a paid version of its voice assistant. However, some engineers involved in this initiative are skeptical about its potential success.
An Amazon spokesperson emphasized that the company is dedicated to creating value for customers through its services, rather than solely focusing on device sales. They claimed that the Devices & Services organization has successfully established several profitable ventures and is well-prepared for future successes.
In another development, Amazon’s new AI-driven Alexa, showcased in September, is apparently not yet ready for launch. Former employees have indicated that the company lacks sufficient data and necessary chip access to support the advanced large language model required for the updated virtual assistant. Additionally, it has been reported that Amazon is prioritizing generative AI advancements for its Amazon Web Services cloud computing division over the new Alexa project.
In response, Amazon refuted claims made by former employees, insisting that they are misinformed and that the Amazon Artificial General Intelligence team has access to both its proprietary Trainium chips and Nvidia graphics processing units. The company remains committed to its vision of developing the world’s leading personal assistant.