Amazon considering monthly subscription fee for Alexa

Alexa! Cancel my subscription...

After upping the price and slapping adverts on Prime Video, Amazon is now mulling a $5 or $10 subscription for its Alexa service.

The additional fee is a bid to turn a profit on the loss-making service. In return, the company will throw-in conversational generative AI with two tiers of service to sweeten the proposition.

The initiative, codenamed Project Banyan, is being strongly pushed by Amazon CEO Andy Jassy, who is keen to breathe new life into the ten-year-old service. That's according to Reuters, which cites eight anonymous sources at the company to back-up its story.

We first heard rumours of changes to Alexa two years ago, when Amazon cut 10,000 jobs in late 2022.

Reuters' sources suggest Amazon has an August 2024 deadline for the refreshed Alexa, but caution that prices, release dates and even the whole project could be subject to change or even cancellation, depending on the perceived progress.

Alexa was launched in a blaze of publicity in 2014 as the first mass market ‘digital assistant', capable of taking instructions via voice recognition and answering user queries. A pet project of Amazon founder Jeff Bezos, it can also connect to home appliances via a standard API, enabling a range of devices to be voice controlled. However, while Amazon has sold more than 100 million Alexa-enabled devices, interest has faltered in recent years.

In his annual letter to shareholders in April, Jassy indicated that Amazon is working on "an even more intelligent and capable Alexa" as part of its corporate-wide AI push, as the "next pillar" – or "primitive", as Jassy puts it – of Amazon's development.

"There are three distinct layers in the GenAI stack, each of which is gigantic, and each of which we're deeply investing [in]," he wrote.

The "bottom layer", said Jassy, is for "developers and companies wanting to build foundation models." These represent the compute required to train models, generate inferences, and the software to make it easier to build such models. Hence, Amazon's mass procurement of Nvidia GPUs to run AI apps on dedicated servers in AWS datacentres.

On top of that, Amazon has invested heavily in the developments of Trainium and Inferentia, its own AI-optimised custom silicon for AI training and inference, respectively.

"The middle layer is for customers seeking to leverage an existing FM [foundation model]… and features to build a GenAI application – all as a managed service," added Jassy.

But it is in the top layer of the stack – the application layer – where he expects Amazon to strike gold, starting with the monetisation of generative AI applications via the Alexa service and brand.

"We're building a substantial number of GenAI applications across every Amazon consumer business. These range from Rufus (our new, AI-powered shopping assistant), to an even more intelligent and capable Alexa, to advertising capabilities (making it simple with natural language prompts to generate, customise and edit high-quality images, advertising copy and videos), to customer and seller service productivity apps."

Project Banyan falls under this layer, among a slew of apps that Amazon is building, but with the expectation that partners and AWS subscribers will develop many more to run on its technology in AWS datacentres.

Computing says:

Let's be honest, the real reason Alexa failed is that nobody wants to shop without being able to see what they're buying. Jassy's original plan for the system was to sell it as a loss leader to get more people shopping on Amazon, but that idea falls down when you can't easily access all the information you want about a product.

However, despite Alexa making sweeping losses Amazon can't just ditch it - it's become too integral to a minority of people's lives, including those with disabilities.