Shares in Amazon (AMZN) responded positively today after the tech group unveiled a new and improved AI-powered Alexa voice assistant.
At its launch event Amazon said Alexa+, powered by generative AI, would engage users in “natural, flowing conversations” and over time learn more about their favorite TV shows, food and weekly family traditions like dog washing Sundays. The long-anticipated system is, said Amazon, built on its Bedrock cloud platform which is designed to let organizations experiment with generative AI models. Amazon’s devices and services chief Panos Panay called it a “complete re-architecture.”
New Services Don’t Come Cheap
But it won’t come cheap. It will cost $19.99 a month, or it’s available for free alongside Amazon’s $14.99 Prime subscription. It is understood that 6 million people in the U.S. use an Alexa with the device holding a 66% market share. Worldwide, as of 2023 figures, it has sold 500 million. However, there have been concerns over increasing competition from the likes of Apple (AAPL) and reports that its sales have come at a loss for the group.
Among the models Alexa+ is using are Amazon Nova, Amazon’s family of in-house generative AI models, as well as models from Amazon’s close partner and collaborator Anthropic. This “model agnostic” approach means Alexa+ can leverage a new system called “experts” for particular tasks. Experts orchestrate Amazon services and devices as well as services and devices from third parties. One of these new services, Amazon revealed ,will be a news resource which will utilise partner publications such as Reuters and the Associated Press. This will help users with queries on latest world events or the direction of their share prices.
Broken Ovens and Dinner Dates
Amazon said Alexa+ can also navigate websites to complete tasks on a user’s behalf such as finding an engineer to replace a broken oven. It can also help with booking a dinner reservation if that repair looks like taking a long time. “The new Alexa knows almost everything in your life — your schedule, your smart home, your preferences, the devices you’re using, the people you’re connected to,” Panay said.
Is AMZN a Good Stock to Buy?
On TipRanks, AMZN has a Strong Buy consensus based on 47 Buy and 1 Hold rating. Its highest price target is $306. AMZN stock’s consensus price target is $268.91 implying an 24.81% upside.
