Amazon plans ads for $20/month Alexa+ as AI losses mount

Amazon CEO Andy Jassy has revealed plans to potentially introduce advertisements to Alexa+, the company’s premium AI assistant service, during the company’s recent earnings call. The move represents Amazon’s latest attempt to monetize its struggling voice assistant platform, which has reportedly cost the company billions of dollars over the years while falling behind competitors like Google’s Gemini and OpenAI’s ChatGPT.

What you should know: Alexa+ is Amazon’s enhanced conversational AI assistant launched in February, designed to compete with advanced AI chatbots through improved memory and natural conversation capabilities.

• The service costs $19.99 per month for non-Prime members, while Prime subscribers can access it for free as part of their existing membership.
• Unlike the original Alexa, which has remained largely ad-free since its 2015 launch, Alexa+ could soon feature targeted advertising during multi-turn conversations.

The big picture: Amazon’s advertising strategy reflects broader industry trends as AI companies struggle to monetize their expensive-to-operate chatbot services.

• Both Google and OpenAI have explored similar advertising models for their AI assistants, with OpenAI briefly considering ads for ChatGPT in December 2024 before stepping back from the idea.
• Amazon has invested billions attempting to upgrade Alexa as competitors surpassed its early market lead in conversational AI.

What they’re saying: Jassy framed the potential advertising integration as a discovery tool rather than intrusive marketing.

• “I think over time, there will be opportunities, you know, as people are engaging in more multi-turn conversations to have advertising play a role — to help people find discovery and also as a lever to drive revenue,” Jassy said during the earnings call.
• He described the initiative as a “significant financial opportunity” for the company.

Why this matters: The move signals Amazon’s urgent need to generate revenue from its AI investments while potentially compromising the user experience that has kept Alexa relatively ad-free for a decade.

• The advertising integration could help Amazon recoup some of the substantial losses from its AI assistant development efforts.
• However, the success will likely depend on how seamlessly and helpfully the ads are integrated into conversations, with users hoping they’ll be skippable at minimum.

What’s next: Amazon has not officially committed to implementing ads in Alexa+, leaving the timeline and specific implementation details unclear for now.