Amazon.com, Inc. (NASDAQ:AMZN) is encountering obstacles in its pursuit of a premium version of its AI-powered voice assistant, Alexa, according to recent reports. The project, tentatively named “Alexa Plus,” aimed at delivering an enhanced and personalized AI experience, is reportedly facing delays due to internal disputes and technical challenges.
Despite conducting tests with 15,000 external customers, the performance of the new Alexa, referred to internally as “Remarkable Alexa,” has been labeled as underwhelming. Business Insider reported earlier this week that the voice assistant frequently provides inaccurate information, raising concerns about its readiness for a public launch.
Alexa, which initially enjoyed success, has struggled to establish a robust business model, leading to downsizing and layoffs within Amazon’s Alexa division last year. The proposed subscription plan, coupled with an advanced Alexa version, represents Amazon’s latest effort to revive the voice technology that was once considered pivotal to its future success.
This development comes at a critical time for Alexa, as it currently trails behind competitors like Alphabet Inc.’s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google Assistant and Apple Inc.’s (NASDAQ:AAPL) Siri. According to the report, Google Assistant is estimated to have 88.8 million users, followed by Siri with 84.2 million users, while Alexa is projected to have 75.6 million users.
Internally, Remarkable Alexa’s performance falls short of Amazon’s expectations, despite being conversational and informative. The voice assistant struggles to provide accurate answers, often delivering lengthy or incorrect responses. Additionally, there is a need for improvement in handling ambiguous customer requests that require coordination across multiple services.
As challenges mount, there is a growing debate within Amazon over the future of the project. Some are questioning the fundamental idea of charging users for Alexa, especially for those already subscribed to existing Amazon services. An insider revealed, “There is tension over whether people will pay for Alexa or not.”
The troubles for Alexa are not new, as it faced criticism in 2023 for allegedly spying on customers, resulting in a settlement of over $30 million. Furthermore, in October of the same year, Alexa was criticized for disseminating false information about the 2020 U.S. Presidential election. The challenges prompted Amazon to shift its focus toward generative AI in November 2023, leading to layoffs within the Alexa division.
