I'll add little bit of context from Kindle Reader which was developed while I was at Amazon. Though I was in no way involved with it I frequently interacted with senior folks who were.
For first few years, Kindle Reader was a massive sink hole at multiple levels. There was this humongous R&D cost, hardware and software. On a recurring basis Amazon absorbed cellular data charges. Remember this was in early 2008 so cellular data charges were big and since this was the first couple of iterations of product the data sync protocol was yet to be optimised so data intensive. For example, the device would phone home every hour or so to fetch new book purchases and metadata such as bookmarks, last read pages etc., It also included a basic web browser. And finally, the unit economics of selling digital books were terrible. Because Amazon was trying to create a new habit they had to incentivise readers with discounts, even without discount they were losing about 4$/book sold.
So all in all this all seemed like a giant resource consuming operation with no hope of generating any profit. But boy did it succeed. Within about 4 years or so kindle books were outselling physical copies something like 3-1. And now I think it's not even worth comparing.
My suspicion is execs expected Alexa ecosystem to follow Kindle's trajectory of success which doesn't seem to have materialised.
> My suspicion is execs expected Alexa ecosystem to follow Kindle's trajectory of success which doesn't seem to have materialised.
I think that sentence encapsulates the problem well: Kindle could succeed as a product with a very simple KPI (ramp up economies of scale until you make a profit per book sold), while Alexa has to develop some nebulous "ecosystem" that nobody is quite sure what it could possibly look like.
Trillions involved in Amazon entering markets one by one to dominate, their secret to lower prices being sell at a loss. Running a company for decades on loans without a need for profit is quite a force.
Amazon has fuelled the race to the bottom and it seems the company inevitably destroys its own good creations given just a short time.
Voice controlled assistants also have always existed. We call them "children".
Probably most of us who were kids before remote controls were common remember changing channels and turning off lights and opening garage doors, all in response to voice commands from our parents.
For first few years, Kindle Reader was a massive sink hole at multiple levels. There was this humongous R&D cost, hardware and software. On a recurring basis Amazon absorbed cellular data charges. Remember this was in early 2008 so cellular data charges were big and since this was the first couple of iterations of product the data sync protocol was yet to be optimised so data intensive. For example, the device would phone home every hour or so to fetch new book purchases and metadata such as bookmarks, last read pages etc., It also included a basic web browser. And finally, the unit economics of selling digital books were terrible. Because Amazon was trying to create a new habit they had to incentivise readers with discounts, even without discount they were losing about 4$/book sold.
So all in all this all seemed like a giant resource consuming operation with no hope of generating any profit. But boy did it succeed. Within about 4 years or so kindle books were outselling physical copies something like 3-1. And now I think it's not even worth comparing.
My suspicion is execs expected Alexa ecosystem to follow Kindle's trajectory of success which doesn't seem to have materialised.