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Despite over 500 million Alexa-enabled devices globally, the division hasn't been highly profitable. The move to a paid upgrade aims to boost revenue by capturing even a small percentage of the massive user base. With 100 million active users, capturing even 10% could generate hundreds of millions annually.
Broader AI Strategy
Partnering with anthropic demonstrates a strategic pivot for Amazon—from building proprietary AI to integrating existing advanced models to accelerate development. The company's focus is shifting toward smarter integrations within smart homes and proactive AI that anticipates user needs, including tailored interactions with children and better smart home automation.