Amazon: Alexa, why do you keep disappointing us?
A decade into its life, Amazon’s Alexa is looking like a “colossal failure,” said Eugene Kim in Business Insider, and the e-commerce giant is questioning where it went wrong. Amazon “is on pace to lose about $10 billion on Alexa and other devices” this year, and the Alexa team is “now the prime target of the biggest layoffs in the company’s history,” raising questions about the technology’s future. A brainchild of Jeff Bezos, Alexa was supposed to introduce “a new business model for the company,” in which Amazon customers would buy products through Echo devices in their homes. But by 2018, “the division was already a money pit.” Alexa-powered devices were among Amazon’s best-selling products on the site, but most of were being “sold at cost.” And while Alexa got a billion interactions a week, “most of the conversations were trivial, commands to play music or ask about the weather.” Giving people weather forecasts isn’t the business Amazon imagined.
I was one of the people who bought into Alexa, said John Naughton in The Guardian, and the Echo Dot speaker I bought years ago has been sitting in a drawer gathering dust. I took it out recently and asked, “Alexa, why are you such a lossmaker?” To which she calmly replied something about mustard gas. “I solemnly thanked her, pulled the cable, and returned her to the drawer.”
Still, even if there are hiccups, voice assistants aren’t going to disappear, said Peter Allen Clark in Axios. They have proved “to have a wide range of applications, even if not in the ways Amazon and Apple originally planned.” Voice input has been a game changer for those with visual or motor impairments, or simply those whose hands are otherwise busy. A 2016 study found that “62 percent of iPhone users used Siri in the car,” allowing drivers to keep their hands on the wheel. VR headsets are also “leaning into voice inputs,” suggesting “voice could see a revival.”
“Great technology by itself doesn’t make money, business models do,” said Parmy Olson in Bloomberg. The first TV commercial for the Echo featured a woman telling Alexa to “add wrapping paper to the shopping list.” It made for a nice demonstration, but in real life “no one trusts Alexa to buy things for them.” That said, the Echo is “much beloved by millions of consumers.” Amazon should follow Apple’s iPhone model and streamline its array of Echo speakers “into a few sleek offerings” that more people “are willing to pay to upgrade.”