Amazon Alexa might finally be getting its biggest AI upgrade yet

For a decade, Amazon Alexa has been a household name, but let’s be honest – most people only use it for setting timers, checking the weather, or playing music.

Now, nearly a year and a half since it first teased an AI-enhanced Alexa in September 2023, it seems Amazon is finally ready to bring that dream to reality. The catch, though, is this new version might come with a price tag.

At its upcoming February 26 private event, tagged "See What's Next," Amazon is expected to unveil a generative AI-powered Alexa, capable of handling complex conversations and executing multiple requests in a single interaction. Unlike the “Classic Alexa”, which remains free, this AI-enhanced version could cost between $5 and $10 per month, as Amazon tries to finally monetize Alexa—following the division's $3 billion loss in 2024.

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TechloyEmmanuel Oyedeji

This AI overhaul also comes at a make-or-break moment for Amazon. While over 500 million Alexa-enabled devices have been sold, internal reports suggest user engagement has dropped, with Alexa often relegated to basic tasks. Meanwhile, competitors like ChatGPT, Google Gemini, and Apple’s upcoming Siri upgrade are redefining digital assistants, making Alexa feel outdated by comparison.

To stay competitive, Amazon is betting big on personalization and automation. The new Alexa will reportedly leverage Anthropic’s Claude models to enhance its conversational abilities. Amazon may also introduce "agent-like" capabilities, meaning Alexa could act autonomously—handling bookings, managing smart devices, or placing orders—without constant user input.

But even with these upgrades, the question is, will people actually pay for Alexa? Reports claim Amazon is already scaling back new features for "Classic Alexa," potentially nudging users toward the paid version. And while Bank of America analysts estimate that even a 10% adoption rate could generate $600 million annually for the company, Amazon will have to prove that Alexa is more than just a voice assistant—it needs to feel indispensable.

Whether users see enough value to subscribe is the real test ahead. For now, we can only look forward to February 26 to see what Amazon announces.

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