Amazon's Alexa home speaker is available for purchase at a San Diego store. Reuters
Amazon is set to release a major update to its Alexa voice assistant in October, just in time for the U.S. holiday season. This new version, internally referred to as "Remarkable," will be powered by Anthropic's Claude AI models rather than Amazon’s own technology. The decision comes as Amazon aims to address performance issues experienced with its in-house software.
The upcoming Alexa upgrade will come with a subscription fee of $5 to $10 per month. This new, paid version will utilize advanced generative AI to handle more complex queries, offering an enhanced user experience. Meanwhile, the standard "Classic" Alexa will remain available for free.
Initial versions of the revamped Alexa, using Amazon's internal AI, faced challenges. Reports indicated that these early models were slow to respond, sometimes taking up to seven seconds to reply to user prompts. This lag led Amazon to switch to Claude, an AI developed by the startup Anthropic, which reportedly performed better than Amazon's own models.
The decision to use Claude stems from its superior performance in comparison to Amazon’s internal AI models. As reported, this move is part of Amazon’s broader strategy to improve Alexa's functionality and competitive edge. Although Amazon has not publicly detailed why it chose Claude over its own technology, it’s clear that the switch aims to deliver a more reliable and effective voice assistant experience.
Anthropic, in which Amazon holds a minority stake, declined to comment on this development. However, Amazon acknowledged the use of various technologies to enhance Alexa. A company spokesperson noted that Amazon uses multiple AI models, including those developed internally and by partners, to provide the best customer experience.
The integration of Anthropic’s AI reflects a broader trend in the tech industry, where major companies are increasingly relying on external AI technologies. For instance, Microsoft and Apple have both partnered with OpenAI to enhance their products.
The new Alexa, set for release in October, is expected to include features like personalized shopping advice, advanced news aggregation, and more sophisticated home automation controls. It will remember user preferences, such as setting alarms or recording favourite TV shows, making daily tasks more convenient.
Despite these promising upgrades, there is some skepticism about whether customers will be willing to pay for the new service. Critics question if the additional cost of $60 to $120 per year for the upgraded Alexa, on top of existing Prime membership fees, will be justified for users.
Amazon has previously announced the sale of 500 million Alexa-enabled devices, although the company does not disclose how many of these users are active. Analysts estimate that around 10% of Alexa users might opt for the paid version, potentially generating $600 million in annual revenue.
The rollout of the new Alexa may face delays or adjustments depending on how well the technology meets internal performance benchmarks. Additionally, Amazon’s investment in Anthropic and its partnership with the AI startup are under scrutiny by antitrust regulators in the UK, which are investigating the deal’s impact on competition.
