Alexa had “no profit timeline,” cost Amazon $25 billion in 4 years
Alexa had “no profit timeline,” cost Amazon $25 billion in 4 years
arstechnica.com
Alexa had “no profit timeline,” cost Amazon $25 billion in 4 years
49 comments
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the profit is the data they use to make money elsewhere. They take a loss to not pay taxes. Companies need to pay off the top.
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I'm very skeptical that the data Alexa collects is anywhere near as valuable as people seem to believe it is.
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On the highest level, they have a constant firehose of as much audio data from a sea of customers as they wish.
Send it to cheap overseas transcribers, use it to train and improve voice recognition and automatic transcription.
Have a backchannel to television viewing and music listening patterns.
Know when different customers are home or not, improving demographics data.
Know what is discussed within the house for data on ad penetration/reach, brand awareness, and better advertisement targeting.
It's not a direct data to money pipeline, but having an always on listening device in someone's home nets you a ton of useful data as an online retailer and advertiser.
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The idea is that people will be willing to pay a recurring fee to use Alexa if it can do more advanced things, like perform multiple commands without the user having to say "Alexa" repeatedly, be more conversational, and manage smart homes more intuitively. Amazon is considering charging $5 to $10 per month for generative AI Alexa,
I don't know if that's worth $5-10/mo. I use Google Nest products at home, mainly to control lights. And yeah it sometimes annoying to be like, "Hey Google do this...Hey Google, do that...Hey Google, do whatever..." But at that point, I usually just use the Google Home app or a specific IoT app. And that's free.
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If Amazon started charging for smart-home solutions, they'd essentially be making the case for FOSS solutions like home assistant.
Granted, there will always be a contingent of people who are unwilling to learn how to self-manage that tech, but there are certainly enough people who are willing that they should think twice about heading down that path.
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I mostly go "Hey Google..." in the dark, often with my eyes closed, in bed. At this point, there is nothing I can think of that I'd like to pay it to do for me in that situation. Some searches, basic calculations, setting alarms, and music, is all I need.
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Pretty sure each of the companies selling smart home systems like this want to become the dominant go to system, so focusing on earning profits doesn't make much sense. You want to lure customers into your ecosystem and for your solution to become so dominant you become a monopoly, or at least so you don't fall behind and let someone else become ubiquitous. I view it as amazon building infrastructure and supporting future endeavors.
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I feel like I see more people using (Google) Assistant and Siri than Alexa, though.
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You'd be surprised. Whenever I'm watching webcams, I always hear people call to Alexa. Siri ranks second and I only hear people call Google by accident.
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49 comments
$25 BILLION dollars wasted. Imagine how many people that could have helped. Fucking travesty.
I'm not against private commerce, but these companies sure are working hard to change my mind.
Amazon sold at a loss, but I don’t imagine the employees or suppliers and their employees feel like being paid was a waste.
Well, sure, but I'm sure most coal miners don't feel super great about their specific job and profession generally. It's a waste of resources and capital generally, not at a zoomed in level
I wouldn't describe it as wasted, even at a stretch. Alexa drives tonnes of money Amazon's way.
Not according to the article:
I agree. Plus, right now Alexa is somewhat integrated with my life. I'm constantly interacting with Amazon's ecosystem. Take that away, and it becomes another online retailer (a hugely important one, but nonetheless...) and movie rental service. I could easily step away from Amazon in a way that is more difficult today.
Multiply that across their customers and is the value 6 billion per year? I don't know, that's a lot of money, but it's not a simple cost analysis.
Hey, bud?
Maybe you should think about how they could possibly waste all that money while turning a profit. Then ask yourself what other industries are doing the same thing?
Is it, maybe, just maybe, all of them?
Is that why you're expected to work a job you hate until the day you die despite productivity being higher than it's ever been?
Like, absurdly so. Maybe ask yourself why society could function reasonably well when a farmer could feed five people but things are more or less the same but with cellphones when they feed 150 instead.
It could've helped 0 people... because people with the $25 billion want to say "Alexa, do this", instead of sitting on their sofas an reveling on how they sent $60/year to help someone they don't know, out of which 90% went to finance the people helping, not the helped ones.
Consumers didn't themselves have, or pay Amazon, the $25b. Amazon had it.