As per a report by Computerworld, Amazon is currently undergoing another round of workforce reductions, with a particular focus on the devices-and-services division, notably impacting the Alexa voice assistant that powers Amazon’s Echo smart speakers and related products.
The company clarified that only a “relatively small percentage of the total number of individuals in the Devices company involved in creating exceptional customer experiences” would be affected by these layoffs.
Amazon attributed these layoffs to the discontinuation of certain initiatives as they shift their investments towards generative AI technologies. While the specific projects being halted were not disclosed, Amazon recently provided a glimpse of their progress in September, showcasing an early iteration based on an advanced language model tailored for voice interactions.
The tech giant has pledged enhancements such as faster response times, improved conversational capabilities, and the ability to engage with Alexa without the initial trigger word “Alexa.”
Despite rumors suggesting potential losses of up to $10 billion in 2022, Alexa remains a significant revenue stream for Amazon, dominating around two-thirds of the smart speaker market in the US as of January 2023, with reportedly “a billion interactions weekly.” Although Amazon’s Echo devices have been well-received, users predominantly utilize Alexa for music playback and weather updates rather than for e-commerce transactions.
The devices sector at Amazon has faced challenges, contributing substantially to the company’s recent announcement of 27,000 job cuts over the past year. Following the departure of longtime executive David Limp, Panos Panay, formerly from Microsoft Surface, assumed leadership. Amazon has also shifted focus towards more budget-friendly products while deferring or canceling certain projects.
Furthermore, a court ruling in Delaware found Amazon liable for $46.7 million for patent infringement related to Alexa.
The potential introduction of a generative AI-powered version of Alexa raises questions regarding its ability to address these challenges. Amazon’s competitors, including Microsoft and Google, are also exploring similar AI advancements. Reports suggest Apple is integrating generative AI features into iOS 18, although the company has been relatively discreet about this development in public announcements.
