Amazon's Hardware Division In Crisis: Alexa To Lose $10 Billion This Year Alone

Is the Amazon Alexa a "colossal failure"? It seems that Amazon's personal assistant Alexa is expected to lose $10 billion this year.

Currently, Amazon is in the process of removing 10,000 jobs from its company. One of the hardest hit units within the company is the Amazon Alexa voice assistant.

According to a Business Insider report, Amazon is witnessing "the swift downfall of the voice assistant" and its "larger hardware division."

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How is Alexa doing?

Could we see the end of Alexa soon? While the assistant is easily more recognisable than Siri or Google Assistant, it is still largely intertwined with Amazon hardware devices; even though many smartphones now come with Alexa built-in.

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In the absence of an ongoing revenue stream, Alexa doesn't really make any money for Amazon. Under its "Worldwide Digital" group that also includes Amazon Prime Video, the division has lost $3 billion in just the first quarter of 2022, with "the vast majority" of the losses attributed to Alexa.

Also read: Amazon Is Training Alexa To Mimic The Voice Of Your Deceased Loved Ones

This is allegedly twice as any other losses in Amazon division, and the hardware team is set to lose $10 billion this year. A former employee described Alexa as "a colossal failure of imagination" and "a wasted opportunity", describing Alexa unit as a "division in crisis."

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Even though Alexa's Echo range of devices are among the "best-selling items on Amazon," the company wants to "make money when people user [their] devices, not when they buy [their] devices."

Also read: Amazon Uses Alexa Voice Data To Target Users With Ads Across The Web: Research

The report adds that by the fourth year of its existence, Alexa is was getting a "billion interactions a week" but most of these were trivial commands to play music and similar things - which cannot be monetised.

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In a public note to employees, Amazon's CEO Andy Jassy said that the company still has "conviction in pursuing" Alexa, but huge cuts will still take place.

What do you think - would the world survive the loss of Amazon's Alexa voice assistant? Let us know in the comments below. For more in the world of technology and science, keep reading Indiatimes.com.

References

Amazon is gutting its voice assistant, Alexa. Employees describe a division in crisis and huge losses on ¡°a wasted opportunity.¡± (2022, November 21). Business Insider. https://www.businessinsider.com/amazon-alexa-job-layoffs-rise-and-fall-2022-11?IR=T

Amadeo, R. (2022, November 21). Amazon Alexa is a ¡°colossal failure,¡± on pace to lose $10 billion this year. Ars Technica. https://arstechnica.com/gadgets/2022/11/amazon-alexa-is-a-colossal-failure-on-pace-to-lose-10-billion-this-year/