Amazon to Launch AI-Overhauled Alexa With Paid Plans, CNBC Reports

According to sources familiar with the matter, Amazon plans to introduce a monthly subscription fee to cover the costs of the upgraded Alexa services. This fee will not be bundled with Amazon’s popular $139 annual Prime subscription, the report noted.

Amazon declined to provide comments on the specifics outlined in the CNBC report.

In September, Amazon announced its development of a generative AI-powered Alexa, responding to increasing competition from chatbots created by OpenAI and Google’s Alphabet. The company reiterated its commitment to enhancing its consumer offerings with advanced AI applications in its annual shareholder letter last month, emphasizing a more capable Alexa as part of its strategy.

Since its introduction in 2014, Alexa has been pivotal for Amazon’s ecosystem, although profitability has remained elusive. The voice assistant has primarily driven traffic to Amazon’s online store, boosting sales.

In recent developments, OpenAI launched its latest AI model, GPT-4o, enhancing real-time conversational capabilities, including the ability to interact with users without delays and accommodate interruptions. Google also upgraded its Gemini chatbot and search engine functionalities.

Media reports suggest Apple is gearing up for an overhaul of its Siri virtual assistant to enhance its competitive position in the AI landscape.

CNBC’s report indicated that Amazon intends to leverage its Titan large language model for the Alexa upgrade, underscoring the company’s significant investments in AI. Amazon recently invested $4 billion in Anthropic, a move seen as bolstering its AI capabilities, particularly with the Claude chatbot competing directly with technologies like ChatGPT.

Despite Amazon’s efforts, some investors express concerns over Microsoft’s early advantage in AI, driven by its investment in OpenAI, potentially posing a threat to Amazon Web Services (AWS), the leading player in the cloud computing industry.

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