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Amazon.com to cut ‘several hundred’ Alexa jobs

A screen in a Cadillac XT6 SUV displays Alexa on the infotainment system at the Amazon booth during the 2020 CES in Las Vegas, Nevada, U.S. January 7, 2020. REUTERS/Steve Marcus/File Photo
A screen in a Cadillac XT6 SUV displays Alexa on the infotainment system at the Amazon booth during the 2020 CES in Las Vegas, Nevada, U.S. January 7, 2020. REUTERS/Steve Marcus/File Photo

Amazon.com (AMZN.O.) announced on Friday that it will reduce the number of employees working in its Alexa voice assistant section. The company cited changed commercial goals and a stronger emphasis on generative artificial intelligence as the reasons for the move.

According to the email, the layoffs would affect several hundred staff working on Alexa. A spokesperson for the company declined to provide any more information about the number of impacted people.

“We’re shifting some of our efforts to better align with our business priorities, and what we know matters most to customers – which includes maximizing our resources and efforts focused on generative AI,” Daniel Rausch, vice president of Alexa and Fire TV, wrote in an email. “This includes maximizing our resources and efforts focused on generative AI.” “These shifts are leading us to discontinue some initiatives.”

This month, Amazon has been cutting back on several different departments, including its music and gaming departments, as well as specific posts in the human resources department.

A representative for the company stated that the majority of the impacted positions were in the devices sector but that there were also a few employees in another area working on Alexa-related goods. Generative artificial intelligence, which can produce software code and extensive text answers in response to brief stimuli, is becoming increasingly popular among businesses.

Alexa is a voice assistant that may be used to play music, set timers, ask questions related to search results, and even serve as a hub for home automation.

According to a story that Reuters published in September, the device business had seen a decline in morale due to worries about what some individuals perceived as a poor product pipeline. In particular, some familiar with the situation pointed the finger at Amazon’s voice assistant Alexa, which has been around for about ten years, for being unable to keep up with the times in the era of generative artificial intelligence.

Amazon said at the time that “to suggest that a few anecdotes paint a picture of reality for an organization as large and diverse as Devices and Services is inaccurate,” and that the company stood by its products.

Without offering specific numbers, Amazon has stated that its devices and services division does not generate a profit.

David Limp, a 13-year veteran of the firm who will leave at the end of this year to lead Amazon founder Jeff Bezos’ Blue Origin rocket startup, was replaced as head of the device unit by Panos Panay, who only joined the company from Microsoft (MSFT.O) one month ago. Panay was hired away from Microsoft. Panay was responsible for overseeing the creation of the Surface tablet.

Alexa, which is used by many people and can be accessed through Echo speakers or video screens, has been difficult for Amazon to turn into a profitable business venture. Most attempts made to earn money from it have focused on making it easier to buy things from Amazon.com.

The online shop headquartered in Seattle, Washington, offers voice assistant devices that compete with those made available by Alphabet (GOOGL.O) and Apple (AAPL.O).

Over the past year, Amazon has eliminated more than 27,000 jobs throughout the corporation. This move is part of a more significant trend of layoffs in the digital industry in the United States, which occurred after the sector employed many workers during the epidemic.

The most recent layoffs were announced despite Amazon posting net profitability for the third quarter that was significantly above analyst projections and anticipated revenue in the year’s final quarter, which was generally in line with predictions. Because of the holiday shopping season, Amazon’s fourth fiscal quarter is the most significant.

In the email, Rausch expressed that he had a positive attitude toward Alexa.

“Incorporating a new large language model into a voice-forward, personal AI has been and continues to be an enormous scientific and engineering challenge,” he said, using a different name for generative AI than “AI.”

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