Once released, it would mark the most significant upgrade to the product since its initial introduction accelerated a wave of digital assistants more than a decade ago.
Amazon on Wednesday sent press invites to an event to be held on February 26 in New York featuring the head of its devices and services team, Panos Panay. A spokesperson said the event is Alexa-focused, while declining to elaborate.
The new generative AI-powered Alexa represents at once a huge opportunity for Amazon, which counts more than half a billion Alexa-enabled devices in the market, and a tremendous risk. Amazon is hoping the revamp, designed to be able to converse with users, can convert some of its hundreds of millions of users into paying customers in an effort to generate a return for the unprofitable business.
The AI service will be able to respond to multiple prompts in sequence and, company executives have said, even act as an “agent” on behalf of users by taking actions for them without their direct involvement. That contrasts with the current iteration, which generally handles only a single request at a time.
Executives have scheduled a meeting, known as a "Go/No-go," for February 14. There they will make a final decision on the "street readiness" of Alexa's generative AI revamp, according to the people and an internal planning document seen by Reuters.
Alexa's revamp carries with it all the challenges inherent in now-familiar generative AI chatbots from OpenAI, Alphabet (GOOGL.O) and others including the possibility of fabricated answers, known as hallucinations. With access to Alexa available in cars, televisions, thermostats and mobile phones, it could become an essential daily tool for scheduling and even shopping.
Initially, Amazon plans to roll out the new Alexa service to a limited number of users and will not charge for it, the people said, though it has considered a $5 to $10 monthly fee. The company will also continue to offer what it is calling “Classic Alexa,” the version broadly available today for free. One of the people said Amazon has discontinued adding new offerings to Classic Alexa.
BEZOS' VISION
Alexa is the brainchild of Amazon founder Jeff Bezos, who envisioned a service that would resemble the voice-activated computers on TV's "Star Trek." The hope was that once perfected, users would turn to the voice assistant for hundreds of everyday tasks like turning on lights, preheating the oven, accessing the internet, playing music, writing emails and summoning taxis.
“Someday in the future - that might be years or decades away - it could answer everything that you would ever ask it,” Amazon’s then chief of devices, Dave Limp, said nearly a decade ago.
With those weighty expectations, the move to upgrade Alexa has suffered delays over concerns around the quality and speed of its responses, people familiar with the matter have told Reuters. Amazon dubbed the new service “Banyan” internally, as well as “Remarkable Alexa,” though it was not immediately clear if the Seattle company planned on using either as a new product name.
In a January Financial Times interview, Amazon executive Rohit Prasad acknowledged some of the obstacles in developing what is effectively an entirely new service, including the work to eliminate hallucinations.
Analysts at Bank of America estimate Amazon could generate $600 million annually if 10% of active users, which it estimates at around 100 million devices, pay $5 per month for the service.
