Amazon Plans Major Alexa Overhaul With AI-Powered Features: Report

Amazon.com Inc. AMZN reportedly plans a major overhaul of its Alexa service, integrating conversational generative AI.

The project, known internally as “Banyan,” will introduce a two-tier system with a premium version potentially costing around $5 monthly, marking the first major update to the voice assistant since its 2014 launch, reported Reuters.

Amazon has set an August deadline for the latest version of Alexa, with CEO Andy Jassy showing a strong interest in revitalizing the service, the report added.

The revamped Alexa, named “Remarkable Alexa,” aims to enhance user interaction with more intelligent and capable features. However, the final pricing and release details remain subject to change based on the progress of Project Banyan.

The updated Alexa is designed to keep pace with advancements from competitors like Alphabet Inc. GOOGL GOOG Google, Microsoft MSFT, and OpenAI.

These companies have gained attention for their chatbots, prompting Amazon to push for AI integration in over half a billion Alexa-enabled devices. Amazon aims to boost Alexa’s usability by providing more proactive, personalized assistance, per the report.

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The report cited Amazon employees who have described Project Banyan as a critical effort to prove Alexa’s viability in generating meaningful sales.

The service’s current uses include setting timers, checking the weather, and controlling smart home devices. With AI enhancements, Amazon hopes Alexa will offer advanced features such as composing emails and making detailed shopping recommendations.

Also, Amazon plans to enhance home automation capabilities through Alexa. Future iterations could enable devices to learn user habits, such as turning on lights or brewing coffee based on daily routines.

In November last year, Amazon reportedly planned to layoff several hundred employees in its Alexa division to focus towards the development of generative AI.

Amazon stock has gained about 49% in the last 12 months. Investors can gain exposure to the stock via Consumer Discretionary Select Sector SPDR Fund XLY and Vanguard Consumer Discretionary ETF VCR.

Price Action: AMZN shares are trading higher by 0.21% at $186.50 at last check Friday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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