Amazon Will Stop Paying Developers Building Alexa Apps in June

Amazon is planning to stop subsidizing developers building apps for its Alexa assistant, which is integrated into the company’s Echo devices and many third-party products. Bloomberg reported today that Amazon will sunset two separate initiatives designed to encourage developers to build Alexa apps in June.

First of all, Amazon reportedly notified members of its Alexa Developer Rewards Program that monthly payments offered to companies working on Alexa apps would end at the end of June. At the same time, Amazon will also stop giving free AWS credits to these developers.

“After 7 years of running the program, we will be ending the program globally on June 30, 2024. This means, after June 30, 2024, you will no longer receive AWS promotional credits from Alexa. Developers like you have and will play a critical role in the success of Alexa and we appreciate your continued engagement,” Amazon explained on a support page for its Alexa Developer Rewards Program.

In a statement shared with Bloomberg, an Amazon spokesperson explained that with fewer than 1% of developers working on Alexa apps taking advantage of these benefits, these programs are no longer required to support the Alexa app ecosystem. “Today, with over 160,000 skills available for customers and a well-established Alexa developer community, these programs have run their course, and we decided to sunset them,” the spokesperson said.

If Amazon did manage to get a lot of developers on board with Alexa apps or “skills,” Alexa itself has been a money-losing business for Amazon. The fact is, most people only use digital assistants for asking about the weather or playing music and podcasts… and not for shopping or other activities that can be easily monetized.

This is something that Google also realized with its own Google Assistant, which probably never got the same level of momentum as Alexa. Last year, Google dropped support for third-party Assistant-powered smart displays, and the Google Assistant also lost a couple of “underutilized” features earlier this year. As OpenAI’s ChatGPT is now able to talk and engage in back-and-forth voice conversations, both Google and Amazon are actually in the process of revamping their AI assistants with generative AI technology.

A recent report from Business Insider mentioned that Amazon was working on a paid AI version of Alexa that could launch later this year. OpenAI, Microsoft, and Google all launched paid versions of their generative AI tools in recent months, but it remains to be seen if Alexa, which doesn’t have the same productivity focus as ChatGPT, Copilot, or Google Gemini could become so good and useful that people would be ready to pay for it.