Amazon's Panos Panay on Alexa Plus, the new color Kindle Scribe, and AI's role in consumer hardware

believe we have our next guest in the reream waiting room. So let's bring him in. PX from Amazon. Welcome to the show. How are you doing? Going on. Great to have you. Thanks so much. Good to be here. Hopping on. Um congratulations on the launch. uh sorry for uh the delay uh but very excited to catch up with you.

Uh would love to start with just an introduction on yourself kind of where you sit within the organization and then we can go into some of the news and some of the updates. Sure. I'm uh the senior vice president uh devices and services.

So what that means is just if I frame it around brands it probably helps a little bit but think about devices across Amazon. You'd start with uh Project Kyper, which are the satellites for Leo Leo constellation that we're building right now.

And on the other end, you would think about Zuks, which are the self-driving cars that you might have seen in Las Vegas. But in between kind of the consumer brands, Alexa, Ring, Fire TV, Fire tablets, uh Kindle, Echo devices, you know, just an array of all the kind of consumer front devices that we build here at Amazon.

Yeah. Uh and and what uh what what's the latest update across the hardware ecosystem? What was announced most recently? We just launched uh a a set of new Echo devices. Super cool. Kind of built for Alexa Plus. This is our new Alexa Plus is our new AI interface uh using Alexa. Just more conversational.

It's really fun product. Uh helps you get stuff done. Two two screenbased devices, an 8 in and 11 in, and two new speakers. killer sound. They're absolutely beautiful, by the way. They're just gorgeous. We can talk about them if you want. Uh, three new Kindles with called the Kindle Scribe.

These and one of them is in color, just gorgeous color writing. Um, a whole array of 4K cameras with Ring, including doorbells, which bringing that clarity. Quite cool. Just these are the cool products and some new Fire TVs.

just quite literally TVs from, you know, 40 in up to 75 in uh including what you call Fire TV Stick. Yeah. Uh how are you thinking about Alexa?

I mean we've been following like uh Siri launched a long time ago and it feels I just activated Siri and it feels like they are at a point where the current the the previous system was very much like business logic with a bunch of different routes that the that the Siri app could go down and now they're kind of in the LLM era in the completely uh AI generative AI era and maybe that necessitates a rethink or a rebuild or a partnership.

How has Amazon grappled with this idea that the architecture of what an AI assistant is might be changing? Yeah, if you there's a couple ways to think about it. First, I think the way you framed it is, you know, previously a lot of this was deterministic.

If you said the right thing, you kind of got the right answer or you know, call it point and shoot where question answer question answer. It's it's flipping on its head now because when LLMs come into play, you have to rearchitect the whole problem.

You move from this deterministic model where if you say the right thing, you get the right answer. It kind of feels limited. You know, it's like a different type of speak that you have towards one of some of these what in the previous agents if you will. But now you're in this conversational world.

Anything you ask unlimited knowledge specifically to Alexa, you you found you there's personality that comes into play. There's empathy that comes into play. there's so you get this personalization but you also get memory and so the more you talk to her the more it knows about you.

So you've gone from this what you would say just give and take moment to a conversation in depth understanding and then actually getting some stuff done. I think the power of it though, um, not only do you have all that, you have this, uh, kind of ambient world around you.

If you have a few Alexa devices plugged in, they'll all update with the new Alexa Plus AI, uh, baseline and you and you and now you can just have a conversation from anywhere.

Ask anything you want, keep your phone in your pocket, and those like critical moments where you don't have to go do the research that way, just have a conversation. It's pretty powerful.

Do you think there's a risk of uh or or some sort of tension between like the Alexa developers, the app store, the I I know some folks who have built specific apps uh that do specific things, but if you drop a more generalized LLM system on top of it, uh that might actually be competitive.

You're kind of competing with your customers like how have you messaged to the developer community around that? developers are pretty pumped about it right now because you know these skills we're still calling you know these basically you're calling these uh APIs that are routing to a skill.

So while it's not deterministic point and shoot it still is um kind of think of it as different agents on the system that you can that you can call on.

So you you're you're seeing these developers write apps u where the LLM makes you know the product Alexa makes the decision kind of orchestrates and says you're you're trying to order a car let me we'll call Uber and then Uber makes the car happen. Yeah.

Um, and I think as you as you see that as an example or you wanted to order food from GrubHub or whatever the answer was, you just ask for the food and and then you know that service makes its move and you know delivers it.

I think there's this fundamental of it's actually better for developers because as if you're serving your customer, they're sitting here, they're trying to tell you what they want. They don't have to be as explicit anymore. they can almost be general in their asks. Yeah.

And at that point, if it's calling on an app or a skill um or an add-on as we call it, developers are pretty pumped about it right now. We have a pretty long list of developers right now. We probably have the largest group of if you will agents attached to any LLM out there. Mhm.

And so you're it is a pretty rare uh situation as it's just not being done anywhere else. How do you think about the future of smart glasses and wearables? Uh Amazon's done so many smart devices from the TV you mentioned to the Kindle to the Alexa. It feels like an obvious thing.

You you have a number of products that have been announced or already live, but where do you think that goes? What formats do you like most? Uh and where are you seeing the most adoption really? So, we see a ton we see our usage kind of just spiking with Alexa Plus on the current device lineup that we have today.

We have frames um frames that people wear uh we see the usage go up, the buds are going up because when you take an agent that that smart with you, it's quite powerful. So you we already see it happening um in different form factors. I mean it's down to user preference.

I will say this, I you're hitting a point that I think is just worth noting. You're I think there are plenty of jobs moving to what you would call AI devices. it's just kind of changing.

And if you think about um kind of the the evolution of different portions of tech over time, let me take you back when I was developing uh I think 14 years ago. I I I was making a laptop and somebody had come to me and said, "What what are you doing? The laptop is dead.

" I can't see you guys right now, but assuming you have laptops in front of you now, I can see. Thank you. Yeah. Like just think about that for a minute. Like that was 14 years ago, guys. Like literally I was we were creating this product. We're going to make this laptop.

It's going to create and I have this vision and you're getting all after it. You're like this is beautiful. Look what it can do and every detail and you're going and the first thing is like why would you build a laptop? That thing is dead. Yeah. The phone has replaced it. It's over for the laptop 14 years ago. Yeah.

These things stick around long time. What really was happening, you know, wasn't that the laptop was dying. It was just getting stronger at what it did Great. Yeah.

Yeah, jobs had kind of moved to the phone and the things that mattered to you on a phone came to life, communications, then you know the advent of social media, uh, shopping probably like things that were easier there, but the things that mattered like right now your notes or your other things that mattered for the laptop, they just got stronger.

I think we're kind of in that same era. I think AI devices are coming down the pipe. Yeah, they're going to be great for certain things. Uh, and to your point, a lot of them will be on the go, whether it's glasses or something on your wrist or, you know, something in your pocket.

I don't talk about, you know, what's in the lab, but for sure, you would you would imagine that as the jobs move, there's going to be form factors that evolve that are going to be more important. I think it just strengthens the form factors that exist today.

Just like the laptop got stronger in my opinion because when the phone came, you know, you got better at the jobs on your laptop, just like when the laptop came, the desktop got stronger for gaming and developers.

And you just see that evolution where it's not that these form factors go away, but they get better at what they are meant to be and then new form factors show up. I think that's happening right now. How do you think about the personality and brand of individual models?

I feel like uh there's a world where I would love an Alexa that I can just say uh it's Claude and I'm talking to an Alexa hardware device, but I like the personality and functionality of Claude and so I want to just kind of run that piece of software by default in the same way that I can select like a default browser.

I have a MacBook but I run Chrome as my default browser. Is there a world where I could be able to do that? It's an interesting thought. It's not how it works for Alexa right now. But it's pretty it's it's interesting.

I don't think for like if I if I think about the customer the you know kind of a I don't know what you would call it but just the b the baseline customer. What I'm trying to do I mean I'm extremely online. I have I have opinions about models. I don't even know what to tell you. Like but many people don't care.

You hit the extreme in the question. But here's how I think about it. I think like Alexa is basically model agnostic. like what's the right model for the job? Sure. And of course, we have fine-tuned models specifically that are built specifically for Alexa to do the jobs that you're looking for.

The thing that matters most, I think, to our customers is that it personalizes to you. Mhm. And so, the more I talk to it about the things that I love, the more it understands me. I think you see that today in other products.

But then as you're in natural conversations or you're asking for the next thing, you don't have to go all the way. Alexa can be proactive for you. I give you a simple example. Maybe it's a silly one, but it is simple. Just kind of being practical. If I ask Alexa, I have a camera. Um, I have a Ring camera right now.

You you have it on the in the where my dogs eat in the dog bowls. And if I ask I can ask Alexa now. It's pretty cool feature. It's just AI and it's, you know, simple sense. Uh, although kind of kind of fun. Did anyone feed the dogs today? That's a classic question at my house.

I get in trouble every night when I get home. Have you fed the dogs yet? I'm like, I just walked in. You know, that sort of thing. Like, how? And and and then there's that moment where I can just turn and ask Alexa and Alexa says, "No, nobody nobody fed the dogs today. " So, it's Yeah.

It's just very cool because it knows nobody fed the dogs. You know, we use Ring video descriptions. We understand there's a dog. We understand that somebody fed the food um and or fed the dog the food. So, if the dog's not fed, I can ask.

But in three days or four days later, it can be proactive and just say, "Hey, nobody's fed the dogs today. " And like you just take that, it didn't matter which LLM or which agents kind of created that scenario to the customer. What mattered was it had the personalization.

It knows I care about it and then uh kind of proactively gave me that information back. I think it's that's the essence of just staying agnostic to it.

But we do use different models and how are you thinking about the way that advertising should integrate into AI assistance because there's a lot of debate happening right now. People are going to assistants for product recommendations and advice on things to buy.

And I think there's a very real and important debate around when should this assistant that's like a trusted advisor. How should ad, you know, ad based recommendations, you know, show up? When is it appropriate? When should it just recommend?

Like, you know, there's no there's usually no objectively best product in a category because every consumer is different. But what's your framework for that? Because obviously Amazon's very pro ad. When do you think you should recommend or what should it recommend? You the way you framed it is right.

I think the like any assistant, the better it knows you, the better the recommendations can be. And so where I get where I think ads do work is when you're actually helping the customer, you know, find what they're looking for. Um, and then it just comes down to the that personalization aspect and some of that history.

If you if there's something you use quite often and you're having, you know, and there's an ad that actually helps you if it's raised to you, uh, that's when I get excited because I think it's like a holistic approach to, you know, that kind of circle. When it's just random and you're like, what is this?

I it really that's painful. It's where it gets painful. And people really have no problem with the idea of an going to your Alexa it and then Amazon taking a cut of the commerce transaction that happens because you see the Amazon truck and you see the delivery network and you see how fast things arrive.

And so there's clear value perveyed there. And so I think most customers are are happy to have Amazon take uh essentially like an affiliate fee almost on that or or cut. Uh the yeah the issue is is how how agnostic. Yeah.

Is there a world where where Alexa would be getting an like an like effectively be an affiliate on the platform like it was an external like you know source that was sending traffic because what I would want is to arrive on is basically say hey Alexa uh and sorry to anybody at home I'm setting off your your Alexa device if you're listening to this.

Um, but uh, hey Alexa, I want to buy uh uh uh I I use the example of a paper towel holder because I I've had a uh and I want it to be from a brand that is over 50 years old and like that is the kind of per that's the kind of product I want to buy from a reputable brand that has been operating and that isn't just, you know, importing the cheapest possible product from from overseas.

And so that is like a very valuable recommendation to me and as a consumer I don't care if Alexa takes a cut but uh that's different than me just searching in in uh you know in a search bar. I agree.

I mean I don't know about I'm not exactly sure what you mean by Alexa taking a cut there but what I would like to see happen in that scenario and I think is what happens today is because we're so conversational we can do that search for you. We can bring it up.

We can also just look at your shopping history if you choose to enable that and then say look here this is the size of paper towels you've been buying and fundamentally you know if you just go to that next level of beyond just I'm going to I heard what you said and here's the answer maybe just do a little bit of logic flow for you and bring back a few options I think that's when it does get like these are those emotional connection points I know it sounds silly we're talking about paper towels but if you're asking for something indirectly and you don't know exactly what you're pointing and shooting for and you get something that's close and you can have a conversation.

Just think about any assistant kind of mode and just talking to somebody. I'm just going to have this conversation and we're going to brainstorm it together. You're you're starting to see that happen on Alexa. It's less so it's more so about refining what it is you're getting after.

Um see that in kind of most aspects on the on the Kindle side. Uh are you getting like feature requests from users that want more AI integrated into products? I can imagine I I pick up a book I haven't read in a while and I it'd be nice to be able to say, "Can you summarize the first three chapters?

" Summarize the entire book in one sentence. I'm done. Okay, I'm done. Uh but yeah, we're getting a bunch of it. And you know, it's a this is a fun I'm going to answer your We have a thing called book so far. So, I'm going to tell you about that.

That was the exact feature you just asked for and and it's AI based and it's basically continue watching for books. Do you know what I mean?

You watch the first three episodes of whatever it is, you know, Rings of Power and you're like, just keep me up to date or, you know, whatever it what show it is, and you just see the recap and then you go into your the next episode. This happens to me all the time because I don't watch enough TV.

Yeah, we have books so far, which is that, you know, hey, summarize how far I am to this book. Remind me. You also can ask the book anything you want. Yeah, you can ask Kindle anything you want about the book. And that was a big feature request, like just want to talk about the character.

I want to know more about what really happened here and now that's happening. So that's where AI enhances it. But you have to be really careful because there's something pure about Kindle. Yeah. That customers love and this is like near and dear to my heart. You you have to be a super fine line.

We do have like on the Kindle scribes that we just launched, we do have AI search for any of your notes.

So if you have hundreds of pages of notes now, you just search for or and then you can say summarize all the notes that I wrote about John or whatever and you know you'd get them all summarized and it would do a smart summary for you and then you can put them in.

You can do all that but here's here's the risk that we're very cautious of. Like Kindle's like a sanctuary. It's like this you you get into it and then you just want to disappear into it. Our users like they love their books. You know what they hate when they're reading books is distractions.

Yeah, I don't even I don't use that word lightly, but it is like if you popped him an ad or put a link up or I infiltrated you with a text coming in uh if you will from Jordy, you'd be like, "God, I'm just trying to read, man. This is my one place to disappear.

" Uh and it's crazy because readers are popping up everywhere. New readers. I think like 60% of our new purchases are from totally new readers right now, just so you know. So, there's a bit of a spike happening because it's a growing category again.

The the trick is to hold that as like that sanctuary where when you do pick up to read, that's what it becomes. The more tech you put in there beyond a book, you know, you you have to be careful. We I think I know where that line is. The team knows where that line is. We have an amazing Kindle team.

They've been doing it for, you know, years and years. This is and they are they they understand the customer so well. But to your point, the customer is starting to ask, can I can I get to what we call book so far or continue watching is the best way to say it in in analogous. And so we created that or summarization.

We have that um and also in your writing you can search your notes, but we're being very selective not to over techify it if that makes sense.

You got to be careful because at the end of the day it is a book um or it is a notepad that you want to write on and and you you have plenty of other devices to let your distractions kick in, but this is the one that we kind of hold coveted and and protect quite a bit. I have one last question.

Uh but maybe it's just a technical one, but uh on on Kindle and AI, uh I think of Kindle as I don't want to say underpowered, but like uh it's it's designed for long battery life, you know, not the craziest screen.

It's supposed to be something you can, you know, throw in your backpack and pull out on a trip and know that it's still charged, right? Uh so I imagine that there's you you should be a product manager for Kindle. Okay, great. Yeah. Hold that line. If you hold if you hold that frame, man, you you're perfect.

Like just just religiously hold on to those statements. Fantastic.

And and and so I imagine that the the AI workloads need to be done in the cloud and you're not thinking about ondevice AI and that's generally the right tradeoff because the summaries can be processed asynchronously or or they can be queued up and and kind of gone back and forth over the over the Wi-Fi network or or for 4G.

I I'm just kind of interested in like what the what the median connectivity versus uh ondevice compute tradeoff looks like for Kindle going forward. Yeah, it's tricky.

We're doing we're doing a lot of work on the edge right now as you you put it on device and um I think you have to because it just it it can envelope speed and sometimes Yeah. Um specifically though uh you basically we serve the customer transparently. Yeah. wherever it's right.

But we are doing work to when it's time and when it's time to use on device. So let's call it like if you're trying to reduce latency on writing and you're doing some beautifification as an example. Yeah. You're going to want to do it on device. If you want to, you know, do books so far like it's a cloud-based thing.

I mean what if you started reading on your is a good example. You started reading on your iPhone. You came over to your Kindle uh and you picked it up. you you want that to be a cloud-based experience. That's not something you wanted on device. So, like there's just there's trade-offs, but we do both.

It's a good question. I think that's true, by the way, across every single device we talked about today. Yeah, totally. Like where's the edge workload more important um if I did want to, you know, depending on if we were doing what whether it was for security or speed, uh you're or cost, whatever it might have been.

You're always trying to find the right balance for the customer. By the way, when you say it, can I show you this? You may not be able to see it on the screen. This is the new color Kindle. Can you see it? The screen's black. Is that rad? So, is that is that color? Look how thin it is. Like, this thing is 5.

4 millm thin. Like, it's crazy. It's so fun. And it has the same battery I've talked about. Same latency, same speed, and I'm I have it here taking notes as I'm talking to you guys, but it it's like a it's a powerhouse now. So, the processor there is double. Yeah. Is that uh is that like e in screen?

like it works outside and bright sun. So it almost feels like when you look at it it's so soft on the eyes, right? It has a front light and the front light sure basically across the screen so it's not blasting you. So it still has that subtlety. You don't feel as tired as you're looking at it.

You can do it in the dark in the light. There's nothing that you lose this screen. It's a matte screen. It's perfect for writing. Wow. And you're so you get all those pieces. The refinement was color.

So there's always this battle like but it's not an LCD with the beautifification of you know OLED and so forth but I mean there's something beautiful and subtle about this almost like colored pencils on the screen. Um and so even when you're writing in color it feels that way.

It's quite it's it's pretty uh one of my favorites. We got to get one. We got to figure out how to jailbreak it. Sideload the Sora slob feed. I want brain rot on that thing. Don't tell me. Don't tell me. Don't tell me any of that stuff, man. I don't want to hear Last thing.

Do you think uh do you think do you think Amazon's AI opportunity is broadly underappreciated? I mean it feels like there's so much surface area every retail opportunity anthropic. You guys already have a suite of devices that people use and love that are in people's homes.

It feels like in many ways either you know you guys also have data centers too. A few of those few racks. They invented the data center. Uh for sure. Yeah. For sure. I mean I don't know how else to say it.

like hands down you know you're every part every part of Amazon is like entrenched and driving um through AI and whether it's Bedrock AWS what's happening like cloud-wise all the models we run we make available to our customers um all the way through stores and what they're doing fundamentally to help your shopping experience better prime video and what they're doing we have a jump to scene with Fire TV did you guys know That's very cool.

Well, that's very movie scene. I mean, also the largest deployment of of robots, I believe, in the world is correct. Oh, well, I don't know if that's I don't know if that's accurate. I maybe in the US. I I saw some chart where you guys were were passing a million robots. Yeah, it's pretty massive.

And then like, you know, controlled by and then you have the other side of it. All the Alexa devices now are about to be powered by Alexa plus. This is like core foundation Sure. of like consumer AI in its most practical sense.

Yeah, you're in this place now where you know I'm at the dinner table with the family and instead of somebody pulling out their phone to get the answer or research something, we just have a conversation with Alexa and you got the full depth of what you would have expected from an LLM based product, but it just very practical and ready for you.

And so like I think the whole gamut is you're right, it's it's quite underappreciated right now. I don't I don't know what the right way to frame it is on the other side without sounding too like you know, but I I do think I I agree. So I think uh and I think I think the market will will uh will realize eventually.

So I do too. I think you know first thing serve the customer, serve the customer, serve the customer and do it in the right way. I think you know that's our focus and we'll we'll we'll kind of continue to do that. But you're right. I think that it gets it'll get noticed, seen, understood.

Um I'm pretty proud of it right now. And when you see what's coming with Alexa plus with Ring uh with Ring video search or Ring story descriptions and like summarizing your day, it really starts making it something. It takes AI to the next level in my mind because it just makes it practical for people.

Like it just puts it right there. Don't get me wrong, you can actually use Alexa. com too to do all the things that people are associating with a traditional LLM. It's quite cool as well.

um or the app, but at the end of the day, there's just a whole new set of practical ways to use it that I think are going to be pretty delightful for our customers. When's the new Scribe actually releasing? I just tried to buy it while we were talking and it says coming soon.

I I'm not allowed to give you the date on here, but it's Yeah, you have to get on the You have to get on the wait list. Our demand is a little bit higher than we expected it to be. Right now, we're in we're in production. So, you you guys couldn't get the demand planning right. I want a scrub.

It was a demand like two days. You'll have it before the holiday. You'll have I want it in two days as long as people are very pumped about it. I'll make sure you get I'll I'll make sure you guys get it. Awesome. Put your name down and I'll make sure. We will. We will. Awesome. Well, great to hang out.

Congrats on on all the progress. Yeah, really really fascinating tour of the ecosystem. I appreciate you breaking it down for us. Thanks so much. Been fun, guys. You take care. Wait, also I think obviously it's too late now, but is is Panos the first are you I think you're the first person from Amazon ever on our show.

I think so. I think we've had a thousand interviews this year. Here we go. Bring the damn dong. There we go. Congratulations. It's great to have you. Thank you. We'll we'll see you soon. We'll see you soon. Cheers. Have a good one. Uh we have some breaking news that we got to cover.

Sam Alman has replied to his uh his post about erotic content and chatt says, "Okay, this tweet about upcoming changes to chat pt blew up on the erotica point much more than I thought it was going to.

I didn't think you didn't think posting e r o t i ca was going to There are there are so many other words that you could have used to kind of like, you know, get there. could have just said romantic companion. Exactly. We have said that when the entire time we were discussing uh Grock, we like that this is a clean show.

We like that we I've never I never wanted to say that word on the show. Exactly. So when we talk about this, we say adult content, adult romantic companion. We don't go to the other words. Um but yes, he went there. He said E R O T I A. He typed it out into his ex app, sent the tweet.

Uh, and he said it was meant to be just one example of us allowing more user freedom for adults. Here is an effort to better communicate it. I'm going to read it and you tell me, is this better communication, Jordy?

Uh, he says, "As we have said earlier, we are making a decision to prioritize safety over privacy and freedom for teenagers, and we are not loosening any policies related to mental health. This is a new and powerful technology and we believe minors need significant protection. I love that point.

Uh we also care very much about the principle of treating adult users like adults. As AI becomes more important in people's lives, allowing a lot of freedom for people to use AI in the ways that they want is an important part of our mission. It does it doesn't apply across the board, of course.

For example, we will still not allow things that cause harm to others. And we will treat users who are having mental health crises very different from users who are not without being paternalistic. We will attempt to help users achieve their long-term goals.

But we are not the elected moral police of the world of the world. In the same way that society differentiates other appropriate boundaries, R-rated movies for example, we want to do the same thing here. Let's hear it for the MPAA rating system that's gaining popularity. Yes, I want this so badly.

I just want to in the app store it should say Rrr rated. R-rated. Oh, but that is not NC7 rated, which is a different thing. And so we were debating this. Uh is So you're a movie buff. Is No, no. I mean, is is is Amazon's erotic content on the Kindle is that is that X-rated? Is that the same as Only Fans?

Is that the same as a a an adult content video site? like it does feel somewhat different. Uh, and so I don't know, maybe this is a nod to staying in the R-rated category, not going further. I don't know. We'll see. Uh, what's your reaction, Jordy, to this post? Is it effective comms? Put on your Lulu hat.

Yeah, I mean, the problem is that 14 almost 14 million people saw yesterday's post. You add that up with, you know, thousands of other posts and, you know, it really did blow up. This post is going to get certainly get plenty of uh plenty of views, but um I think the the community has already taken it. I don't know.

I I I think I think the the December timeline there's a there's a lot of days between now and December. Uh AGI might hit before then. Uh but there's so much that could happen to tweak that policy before it goes out, really silo it. I don't know. We'll we'll have to see.

I I I can almost guarantee that when it rolls out, there will be crazy screenshots on the timeline that day of people getting it to do crazy stuff because people love jailbreaking this stuff. They've already been doing it. Anyway, let me tell you about Turbop Puffer.

Search every bite serverless vector and full text search build from first principles on object storage. Fast 10x cheaper and extremely scalable. You can load all your erotic content into Turbo Puffer. Search it 10 times cheaper. Um, and we have our our first inerson guest of the show. We got Adam Ryan from Work Week,