Amazon’s Alexa is getting an upgrade as reported on Friday, Aug. 30, by Reuters. With the artificial intelligence race still in full swing, the latest move may be a signal that the online retailer is willing to collaborate more to win the competition.
The new Alexa will be released in October and will largely be powered by Anthropic’s Claude AI chatbot. The decision to go with a startup company’s AI technology instead of Amazon’s internal technology comes after in-house AI at Amazon reportedly experienced delayed responses.
The CEO of Anthropic, Dario Amodei, has spoken in the past about why a partnership with Amazon works for both companies.
“Anthropic is a company that focuses on producing AI,” Amodei said. “These other companies that are partnering with the cloud providers, provides something that’s complimentary to us in an economic sense.”
However, the new Alexa isn’t free like the current version, it will cost users $5 to $10 a month. The current Alexa can set alarms, play music and answer simple questions, but Amazon also wanted its users to shop through the device, which hasn’t worked so well in the past as the company failed to make a profit on the idea.
The new version dubbed “Remarkable Alexa” is hoping to change those fortunes, designed in part to inquire about purchases, like which clothes to buy for a vacation. Amazon envisions it as a home “automation hub,” remembering a person’s preferences and acting on them.
Examples include recording a user’s favorite shows or setting their alarms, even if they forget. The company said answers to questions will also evolve as the technology builds on prior conversations with the user.
Amazon invested $4 billion in Anthropic after the release of OpenAI’s ChatGPT left Big Tech companies scrambling for better AI software. Analysts predict 10% of around 100 million active Alexa users will opt for the paid version, which would bring in at least $600 million in annual sales.
The new Alexa is expected to be unveiled at Amazon’s annual devices and services event, which is typically held in September.
