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Amazon
Alexa hasn’t worked the way Amazon originally planned.
There was a time when Alexa was thought to offer a robust ecosystem of apps or Alexa Skills that would make the voice assistant an integral part of users’ lives. Amazon has hired tens of thousands of software developers to build valuable capabilities for Alexa that will boost the voice assistant’s popularity and help Amazon make some money.
But nearly seven years after launching a rewards program to incentivize developers to build skills, Alexa’s most preferred capabilities are basic ones like checking the weather. And on June 30, Amazon will stop issuing monthly Amazon Web Services credits that are free for third-party developers to build and host Alexa Skills. The company recently told devs that its Alexa Developer Rewards program is ending, effectively disallowing third-party developers from building for Alexa.
A death sentence for third-party Alexa apps
The news has dozens of Alexa Skills developers wondering if they have a future with Alexa, especially as Amazon prepares a productive AI and subscription-based version of Alexa. “Dozens” might sound like a dig at Alexa’s ecosystem, but that’s an estimate based on a podcast by Skills developers Mark Tucker and Allen Furstenberg, who admitted in a recent podcast that “dozens” of third-party devs are thinking. Alexa skills are still worth developing. The casual summary isn’t stated as hard fact or confirmed by Amazon, but seems like a rough and quick estimate based on the developers’ familiarity with the Skills community. But with such minimal interest and money related to skills, even Dozens is not an unfathomable figure.
Amazon admits it has little interest in its skills incentive programs. According to Amazon spokeswoman Lauren Reimhild, “Less than 1 percent of developers are using programs that will soon end,” Bloomberg reported.
“Today, with over 160,000 skills available to customers and a well-established Alexa developer community, these programs have run their course and we’ve decided to sunset them,” he told the publication.
The writing on the wall is that Amazon doesn’t have the incentives or the money to grow the Alexa app ecosystem it once envisioned. Voice assistants have largely become money pits, and the Alexa division has endured recent layoffs as it struggles for survival and relevance. Meanwhile, Google Assistant will stop using third-party apps in 2022.
“Many developers now have to make some tough decisions about existing or creating future experiences on Alexa,” Tucker said via a LinkedIn post.
Alexa Skills criticized as “useless”.
As of this writing, the top Alexa skills, in order: Jeopardy, Are you smarter than a 5th grader?, Who wants to be a millionaire?, and quiet. This isn’t exactly a futuristic list of must-have tech adventures. For years, people have been wondering when a “killer app” would arrive to catapult Alexa’s popularity. But now it seems Alexa’s only hope for that killer use case is generative AI (a gamble fraught with its own obstacles).
But like Amazon, third-party developers have had a hard time monetizing the skill, with a rare few tipping to make thousands of dollars and most making next to nothing.
“If you can’t make money from it, nobody’s going to get seriously involved,” Joseph “Joe” Jaaquinta, a developer who made 12 Skills, told CNET in 2017.
As of 2018, Amazon has paid developers millions to develop Alexa Skills. But as of 2020, Amazon has reduced its payments to third-party developers, an anonymous source told Bloomberg. The source noted that apps made by paid developers are not making much money for the company. In 2024, the most desirable things you can do with Alexa will remain basic tasks like playing songs and apparently trivia games.
Amazon hasn’t said it’s ending the skills. That seems premature considering its Alexa chatbot isn’t expected until June. Developers can still earn money from skills with in-app purchases, but incentives are reduced.
“Developers like you play a critical role in Alexa’s success, and we appreciate your continued engagement,” Amazon’s notice to devs said, according to Bloomberg.
We’ll see how Amazon treats the rest of the developers once its productive AI chatbot is ready.
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