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Short version: Asking Alexa to switch the lights on isn't exactly profitable for Amazon!!
If this is even vaguely true it's pretty mind blowing:
"The Alexa division is part of the "Worldwide Digital" group along with Amazon Prime video, and Business Insider says that division lost $3 billion in just the first quarter of 2022, with "the vast majority" of the losses blamed on Alexa. That is apparently double the losses of any other division, and the report says the hardware team is on pace to lose $10 billion this year."
the report says the hardware team is on pace to lose $10 billion this year
The hardware has obviously been a loss leader for years now, to get market share and access to homes. That the money is made elsewhere in the group will surprise no one. It's like saying an in house marketing department loses money, while the retail elements of the same company gain market share year on year while making vast profits and squashing competitors.
Because all the profit from the associated data mining goes into other bits of the business I imagine.
Probably a convenient tax dodge as well.
The hardware has obviously been a loss leader for years now, to get market share and access to homes. That the money is made elsewhere in the group will surprise no one
There's something not going to plan though if you're planned loss leader is losing so much that you start paying people off
"Hey, Alexa, what tyres for the Surrey Hills?"
No data mining here with Alexa. I am from the Midlands. Alexa understands me not at all. Indeed all Alexa is for me is a means to teach swearing to the kids, and for them to laugh at me as it doesn't understand a word I say.
Sorry, I couldn't understand that..
very true, I had no idea of the scale of it though... $10Bn is a [I]lot[/I] even for Amazon!The hardware has obviously been a loss leader for years now, to get market share and access to homes.
Will the strategy pay off? Depends whether the people who've bought into the Alexa eco-system are "whales" who spend a lot, or if they've just bought it as it's the cheap option cos they're tight as **** 😂
No data mining here with Alexa. I am from the Midlands. Alexa understands me not at all. Indeed all Alexa is for me is a means to teach swearing to the kids, and for them to laugh at me as it doesn’t understand a word I say.
Reminded me of this
https://www.youtube.com/shorts/egXmY-mFaOc
Without other data it doesn’t tell us much - possibly just that Amazon are heavily investing in the business unit right now.
It doesn’t mean that profits won’t jump when the investment taps are turned off.
It’s possibly not much different than other businesses with high up front development costs e.g. infrastructure projects, oil, pharmaceuticals etc.
No data mining here with Alexa. I am from the Midlands. Alexa understands me not at all. Indeed all Alexa is for me is a means to teach swearing to the kids, and for them to laugh at me as it doesn’t understand a word I say.
What if... Alexa understands you just fine (and can harvest your every utterance for the purposes of selling you stuff), it just chooses to discriminate?
The hardware has obviously been a loss leader for years now, to get market share and access to homes. That the money is made elsewhere in the group will surprise no one. It’s like saying an in house marketing department loses money, while the retail elements of the same company gain market share year on year while making vast profits and squashing competitors.
Nope - it's not a profit centre period.
Just about every plan to monetize Alexa has failed, with one former employee calling Alexa "a colossal failure of imagination," and "a wasted opportunity." This month's layoffs are the end result of years of trying to turn things around. Alexa was given a huge runway at the company, back when it was reportedly the "pet project" of former CEO Jeff Bezos. An all-hands crisis meeting took place in 2019 to try to turn the monetization problem around, but that was fruitless. By late 2019, Alexa saw a hiring freeze, and Bezos started to lose interest in the project around 2020. Of course, Amazon now has an entirely new CEO, Andy Jassy, who apparently isn't as interested in protecting Alexa.
Alexa, please layoff the Alexa division staff.
Sure Jeff. Increasing Alexa staff wages by 100%.