Amazon plans to upgrade its Alexa voice assistant with generative artificial intelligence and introduce a monthly subscription fee. This new version aims to be more conversational and competitive with AI-powered chatbots from Google and OpenAI. The subscription will not be included in Amazon Prime, and the pricing is undecided.
Key details:
- Generative AI Integration: Alexa will use Amazon's large language model, Titan.
- Subscription Model: A monthly fee will be required.
- Competition: This move follows advanced AI chatbots from OpenAI and Google.
- Internal Changes: Since Andy Jassy became CEO in 2021, there has been a shift in focus and resources within Amazon, reducing the emphasis on Alexa compared to Jeff Bezos' tenure.
- Market Position: Despite selling over 500 million Alexa-enabled devices, Amazon faces challenges in keeping Alexa relevant amid rapid AI advancements.
- Cost and Pricing: Generative AI usage costs are significant, with estimates suggesting 2 cents per query. Internally, a $20 monthly price point has been discussed, though some suggest a lower price to remain competitive.
Former employees noted that Alexa was initially a passion project for Bezos, receiving ample funding and less pressure for immediate returns. Under Jassy, there has been a push for profitability and efficiency. The team has undergone reorganization, with many members moving to the artificial general intelligence (AGI) team.
Amazon's investment in AI includes a $2.75 billion stake in AI startup Anthropic, highlighting its commitment to advancing AI capabilities. Despite these efforts, there is a perception that Amazon lags behind competitors like OpenAI, Google, and Meta in AI.
The upcoming changes to Alexa are crucial for maintaining its market position and justifying the resources invested in it. The existing user base of Alexa devices presents both an opportunity and a challenge, as any shortcomings in the new AI capabilities could have significant repercussions.
