Amazon Wants You to Start Paying for Alexa

As AI changes up the voice assistant business, Amazon is reportedly looking to start charging a paid fee for Alexa as soon as this Summer

More than 75 million people use Alexa, but by Amazon’s standards, the service is a total failure. The problem is Alexa doesn’t make any money, and the service is a huge drain on company resources. Apparently, Amazon has a last-ditch plan to save its digital assistant by supercharging it with AI and charging you for the privilege of using it—but things aren’t looking good.

According to a report in Business Insider Thursday, the secret new Alexa barely works thanks to hallucinating AI and broken tech. It apparently sparked political tensions inside the company, particularly because many Amazon employees don’t believe that people will be willing to pay.

Beyond the classic failures of this generation of artificial intelligence, the new Alexa requires a massive shift in both the company’s strategy and the technology running behind the scenes. Some long-time Alexa workers aren’t happy about it. According to BI, the team who built the original Alexa doesn’t want to let their baby go and has forced Amazon to maintain parts of the original technology stack, which makes the new Remarkable Alexa bloated and more difficult to run.

Then there are people who aren’t sold on the entire project. The number of services Amazon wants to tack onto your monthly bill keeps growing. There’s Prime, of course, but Amazon also pushes various streaming services, Audible, and more. Employees reportedly told BI that a lot of people don’t think the company will be able to convince its customers to pay a fee to use a smart speaker on top of the money they already pay.

This potentially doomed-from-the-start initiative is a response to growing pressure to make waves in the fledgling AI business. Google, Apple, and Amazon all spent billions of dollars developing smart assistants, a technology that was supposed to be the future of computing. Years later, that project failed to deliver any meaningful revenue. Silicon Valley generally views Alexa, Google Assistant, and Siri as misguided investments, and the teams working on smart speakers have been especially hard hit by layoffs and budget cuts in recent years. After making such a big deal about them, the tech industry doesn’t want to let them go.

Now there’s renewed interest in these assistants as a way for consumers to interface with next-generation AI. Amazon and Apple in particular are playing catch up in that arena after Google, Microsoft, and OpenAI ran away with the AI hype cycle. Amazon built out its own AI models to compete with the ChatGPTs of the world, which the company calls Q, and reportedly has even more ambitious models in development.

It’s not surprising that Amazon wants to start charging for Alexa, though, as the voice assistant reportedly loses money for the company. With AI being even more expensive for these sorts of products, trying to charge a fee totally makes sense. But, if these employee stories are accurate, it certainly sounds like it would be in Amazon’s best interests to hold off for a while until things, well, actually work.

Adding AI to digital assistants is a no-brainer, and if Amazon can do it in a way that also turns Alexa into a money maker, it would solve a number of major headaches. If the plan doesn’t work, however, it could bring Alexa one step closer to the grave.

Would you pay for a voice assistant like Alexa?

January 20, 2024