What the Tech: Will you soon have to pay to use your Alexa device?
By JAMIE TUCKER Consumer Technology Reporter
Prepare yourself to pay extra for Alexa.
If you shop at Amazon you’ve probably purchased an Amazon Echo or Alexa device. Amazon has reportedly sold nearly a billion of these connected devices but that doesn’t mean it has made money from them.
Amazon reportedly loses about $5 billion a year on Echo devices and the platform and wants to make it profitable finally. The answer is charging a monthly subscription for additional features.
Subscriptions are expected to launch this summer.
I contacted Amazon about the reports and a spokesperson said the company had no announcement at this time but pointed me to this Bloomberg article from last September.
The opinion columnist interviewed the outgoing executive in charge of Alexa, Dave Limp.
In the interview, Bloomberg columnist Dave Lee asked Limp about a possible Alexa subscription to which he replied, “Yes, we absolutely think that. When you start using these a lot, the cost to train the model, and the cost for inference of the model in the cloud, is substantial.”
At times, Amazon sells Echo devices for less than they cost to make. The only reason for this is that Prime members might order more products by asking the device to place the orders. It’s similar to the old Amazon buttons that made it easy to re-order dog food by clicking a device next to the dog bowl.
That hasn’t been the case as most Alexa users probably use it the most by asking it to play music from Spotify or checking to see if a nearby business is open.
Limp said the future of Alexa will be adding additional generative AI features so that Alexa is more helpful.
Limp also said much of what people use Alexa for now will remain free. That might mean you’ll be able to get the time, and weather forecast, play music from Amazon Prime Music, and check the status of Amazon orders.
It shouldn’t come as a total shock that Amazon will require a subscription. Late last year the company announced it will add commercials to TV shows and movies on Amazon Prime Video unless customers pay an additional fee for commercial free.
