Amazon & Sony Clashed Over Ads On Echo Speakers: Report

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Amazon and Sony clashed over the idea of running ads through the former's Alexa-powered Echo speakers, The Information reported Monday, citing sources familiar with the dispute. The two tech giants reportedly had a standoff at some point last year, with the point of contention being Sony's Jeopardy game for Alexa that the Japanese company wanted to monetize with advertisements. Amazon refused that proposal even after Sony's repeated insistence, frustrating the Tokyo-based firm in the process of doing so, insiders claim. Sony reportedly felt wronged because it invested a significant sum in developing the Jeopardy skill for Alexa yet was refused from monetizing it with advertisements as Amazon claimed doing so could negatively affect the game's user engagement and retention rates. The denied company is understood to have been unconvinced by such arguments as not being able to monetize the software made Jeopardy's popularity significantly less relevant to its management.

Amazon started paying some developers of popular Alexa skills last year but has yet to explain how it calculates their fees, though the firm likely uses the time people spend with such voice-enabled apps as the basis for any payments made to developers. The Seattle, Washington-based retailer is also currently in the process of experimenting with optional subscriptions, allowing users to receive extra content from certain skills in exchange for a small monthly fee. In Jeopardy's case, $1.99 per month provides players with access to additional questions. Jeopardy is still believed to be by far the most popular game on the Alexa Skills Store, boasting approximately 80,000 monthly users as of mid-2017, one insider claims. Sony Pictures Entertainment Games VP Geremie Camara told The Information that monetization was never the sole priority of the voice quiz. Instead, Jeopardy was meant to establish Sony's presence in the emerging voice-enabled apps market, according to the executive.

Amazon has been extremely careful in its approach to experimenting with monetizing its artificial intelligence ecosystem, strongly refuting recent rumors that it's planning a major Alexa advertising push in the near future. The company's AI efforts are still in the process of pursuing startup-like growth but won't be able to maintain that status quo forever; as is the case with Google, Amazon is believed to actually be losing money on sales of some of its smart speakers.

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