The overall play for Amazon, says Forrester Principal Analyst Thomas Husson, is to continue to make Alexa more useful with more smart home integration and more media capabilities. Why? The more people use Alexa devices, the more likely they are to spend money on Amazon. And so, unlike many rivals, it can afford to take a loss on the gadgets. “Amazon will increasingly subsidize Echo by bundling content (think music, video) with the device,” Husson says. “They can afford this since this is not core to their business model: the end-goal is to facilitate interactions.”
Source: Amazon Echo vs. Google Home vs. Microsoft Cortana vs. Apple Siri – Business Insider
See also: Amazon’s Alexa at CES 2017