Comment Black Friday is nearly upon us, but the annual online price-drop frenzy seems to be losing its shine. Numerous reports highlight that discounting may not be all it seems, and buyers would be best to shop around.
But behind the scenes, the industry is also seeing the demise of another popular craze Amazon was trying so hard to make a thing. With its voice-interface device, Alexa, the global ecommerce and tech behemoth in 2014 set in train a fashion for speech interfaces in the home, which had keen households around the world demanding their AI house guests to tell them jokes and answer trivia questions.
But why? That’s just what Amazon may be wondering. According to reports, its Worldwide Digital unit, which Echo smart speakers and Alexa voice technology fall under, hit an operating loss of over $3 billion. Business Insider also claimed the vast majority of the losses were tied to Amazon’s Alexa and other devices.
When asked by The Register, Amazon did not respond to this. Instead, in a statement, Amazon’s senior vice president for devices and services David Limp said: “We are as committed as ever to Echo and Alexa, and will continue to invest heavily in them.”
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Eight years after its launch this is not how it was supposed to be. Alexa, along with voice-interface cousins Google Assistant and Microsoft’s Cortana, were supposed to usher in a new era of at-home interaction with information services and retail sales.
Some estimates said the market for so-called “conversational commerce” would be worth $35 billion by 2020.
The argument went something like this. Offering up a combination of information and shopping, voice assistants would be able to give households guidance and advice – weather, travel, recipes etcetera – while in the background Amazon or third-party retailers use some clever analytics to serve up the most likely purchases in a given period.
In this slightly creepy vision of surveillance capitalism, we imagine what someone who commutes 20 miles to work on a rainy Wednesday might be wanting to cook for their school-aged kids – one of whom is lactose intolerant – when they get home. The sheer convenience and usefulness were supposed to make the services extremely sticky. Given Amazon also provides video streaming services, it was part of a so-called “digital entanglement” designed to guarantee customer loyalty.
What went wrong? While the tech firms behind these services did sign a number of partnerships with retailers, and offer access to their platforms via “skills” to allow retailers take orders by voice, customers don’t seem so keen.
From 2018 onward there was a flurry of stories suggesting voice shopping was not all that it was cracked up to be and that consumers were just as happy to sit down and click away until they had the basket they wanted.
While timers, music, and weather forecasts might be good for users, they are hardly high earners for the platform providers. At the same time, the first page of Amazon “skills” downloads include four apps for making fart noises.
Maybe it’s an idea whose time is yet to come. But for now the dream of a cross-platform voice-assisted future for commerce and digital services seems set to fall silent. ®
source: The Register