Amazon.com Inc. has paused some hiring at its Alexa division amid growing pressure to make money from the voice-activated digital assistant, according to Bloomberg citing two people familiar with the matter.
The pullback began shortly after the pandemic gripped the U.S. in the early spring, the people said. For several months, managers in certain divisions were told they couldn’t replace people who were leaving, they said, though the company has recently begun letting them fill some openings with special approval. Although hiring had slowed in the last couple of years, the current restrictions are much more severe, the people said.
The accelerating push for profits has prompted the company to consider selling ads on the Alexa service, they said, an idea previously avoided for fear of hurting the user experience. The pullback also coincided with a hiring spree at U.S. warehouses, where Amazon has added more than 175,000 people to help handle a surge in online orders.
The two employees, who requested anonymity to discuss an internal matter, said there was never an official announcement of a hiring pause but that they were told to refrain from bringing on new people.
The Echo speakers have attracted millions of fans with their ability to play music and respond to spoken queries. But Alexa has yet to offer a transformative new experience. Surveys show most people use their smart speakers to listen to tunes or make relatively simple requests -- “Alexa, what’s the weather today?” -- but grab their smartphones for more complex tasks.
Usage of Alexa devices skyrocketed after millions of Americans began working from home in mid-March, the two people said. The novelty has partly worn off as people slowly return to their offices, and in certain weeks usage of the devices is just above pre-virus levels, one of the people said.
“We continue to see higher engagement with Alexa over the past several months,” the Amazon spokesman said. “In fact, usage continues to exceed our expectations.”
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