- Amazon’s Alexa voice assistant far exceeded the company’s expectations last year, CEO Jeff Bezos said.
- “We don’t see positive surprises of this magnitude very often – expect us to double down,” Bezos said.
- Alexa already has a lead on its rivals, and Amazon has been focusing on maintaining and building it.
There was a lot to like about Amazon’s Street-beating holiday-quarter earnings results.
But company CEO Jeff Bezos singled out one thing in particular for praise: Amazon’s popular and market-leading Alexa voice assistant.
“Our 2017 projections for Alexa were very optimistic, and we far exceeded them,” Bezos said in the company’s earnings announcement. “We don’t see positive surprises of this magnitude very often – expect us to double down.”
Bezos didn’t explain what forecasts Alexa exceeded or what he meant by “double down.” But we’ve already gotten some hints at what “doubling down” might look like.
Developers have already created some 30,000 skills, or apps, for Alexa, according to Amazon. The company has started to try to actively spur them to build more such skills and better ones.
For example, it started a program last year to pay developers to build new ones. It also started experimenting with allowing developers to charge skills users for extra features.
Recently, Amazon representatives told Business Insider that the company plans to give developers more options to charge for Alexa skills. That could encourage developers to create apps intially or exclusively for Alexa, rather than for its leading rival, Google Assistant.
Amazon already made a big push with Alexa last year, most notably by updating its lineup of Echo smart speakers, which are powered by Alexa, and releasing several new models, including the touchscreen-enabled Echo Show, the Echo Spot alarm clock, and the Echo Plus smart-home hub. The e-commerce giant also inked deals with several gadget companies, appliance manufacturers, and even automobile manufacturers to incorporate Alexa into their products. And it gave its assistant new features, including the ability to make a phone call in response to a voice command.
To be sure, it’s not clear the extent to which Alexa makes a difference on Amazon’s bottom line. The company doesn’t break out revenue from its Echo line. It also doesn’t say how much of the revenues in its retail business are driven by customers ordering through Alexa.
But it’s likely Amazon’s business is already benefitting from the voice assistant. Alexa makes it easier for customers to spend money with Amazon and gives them an incentive to sign up for a subscription to the company’s premium streaming music services.
And Alexa could become more important to Amazon’s sales and profits in the future. The company is already exploring ways to sell ads that would be spoken by Alexa.
So if Amazon is renewing its push with Alexa, you can expect more devices powered by the voice assistant, more Alexa skills and features, and likely more Alexa-compatible home appliances.
And maybe 2018 will surprise Bezos even more.
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