Amazon plans to overhaul its Alexa service with a new project known internally as 'Banyan,' aiming to integrate generative AI and introduce two service tiers. The initiative, called 'Remarkable Alexa,' could include a monthly fee of around$5 for the premium version, which would offer advanced capabilities like composing emails and placing orders from a single prompt. That would mark Alexa's first major update since its 2014 launch.

The project is driven by Amazon's need to revitalise Alexa, which has struggled to turn a profit and compete with AI advancements from companies like Google, Microsoft, and Apple. CEO Andy Jassy has prioritised this update, setting an internal deadline for August. The new Alexa aims to provide more intelligent, personalised assistance, building on generative AI already integrated into over half a billion devices worldwide.

Despite the ambitious plans, some Amazon employees view the project as a 'desperate attempt' to save Alexa, citing challenges such as software inaccuracies and poor morale within the team. While Amazon hopes the AI-powered Alexa will drive more significant sales and enhance home automation, the project's success depends on customer willingness to pay for features currently offered for free and the effectiveness of the new technology.