Amazon working on AI chip that aims to make Alexa quicker, keep Google at bay

Amazon is reportedly developing an artificial intelligence-powered chip that will bolster devices using its smart assistant, Alexa, amid efforts to consolidate its lead in the consumer-facing AI segment and keep Google at bay.

According to a report in The Information quoting unnamed Amazon sources, the chip is being developed so that Alexa can respond to commands faster by processing more data on the device itself rather than the cloud.

The report also said that the technology for building the chip will be derived from Annapurna Labs. Amazon had acquired the Israeli chipmaker three years ago for $350 million. Annapurna Labs was incorporated in 2011 by Avigdor Willenz.

Amazon's smart assistant Alexa is available on its Echo devices, which currently dominate the smart speaker market. Rivals Google and Apple are attempting to catch up with their Home and HomePod devices respectively.

Just last week, Google merged its smart home devices unit Nest with its hardware team in a bid to outgun Alexa.

Google has also started pushing its Tensor Processing Units (TPUs) - AI accelerating circuits - on its cloud platform to enable engineers to run machine learning models faster.

While Amazon has around 450 employees with the expertise of developing AI-powered chips for Alexa, it will face a challenge in manufacturing these chips as it does not have fabrication experience nor does it have manufacturing units in China. 

Interestingly, Amazon's move to make chips might pose a threat to companies like Nvidia and Intel who have been working on making AI-driven chips.

Amazon also recently paid about $90 million to acquire the maker of Blink home security cameras late last year, in a secret bet on the startup’s energy-efficient chips, Reuters reported on Monday.

Amazon is also believed to be working on an AI chip for data centres for its cloud computing subsidiary, Amazon Web Services.

Alexa's dominance

Amazon's Alexa, which was launched in late-2014, dominates the home-speaker market not only in terms of market share but also in skills. 

“Google Home is nowhere near [the number of skills], and the others, notably [Siri], aren’t anywhere in sight,” Werner Goertz, an analyst at research firm Gartner, told Business Insider.

According to a report from Emarketer released in May last year, Amazon dominates the voice-controlled speaker market. It had 70.6% of all voice-enabled speaker users in the US compared to 23.8% captured by Google Home.

Another report from VoiceLabs published in January last year also ranked Alexa as the leading voice AI in terms of market share. Survey data from Edison Research released last June found that Amazon Alexa-enabled devices had 82% market share compared to just 18% for Google Home.

Amazon has also aggressively partnered with companies in the smart kitchen and automobile space to bring Alexa on their devices. 

In January, the company said that its voice assistant will soon start controlling microwaves, smart ovens and refrigerators. Just four days after that annoucement, the company also said that Alexa would also start interacting with drivers.