The tech giant is also reorganizing teams and having engineers focus on a new strategy that involves competing at the frontier level, Business Insider reported Tuesday (July 28), citing sources familiar with the matter.
The report noted that these changes follow job cuts last week at Amazon’s Artificial General Intelligence (AGI) division and the closure of AGI Lab, a research group it launched in 2024 after hiring most of the team at AI startup Adept.
Business Insider argued this restructuring indicates Amazon is refocusing its AI strategy, concentrating talent and computing resources on its largest priorities, rather than investing in text, image and video models.
Sources told the news outlet that Amazon has started phasing out most of its in-house flagship Nova models, such as the high-end Premier and Omni models, Reel video-generation model, and Canvas image-generation model.
Some employees said these models are now in “KTLO” (“keep the lights on”) mode, an engineering term for software that still supports existing customers but is not considered a chief development priority, the Business Insider report added.
According to the publication’s sources, Amazon is shifting resources from its Nova models and toward a new frontier-model effort overseen by researcher Pieter Abbeel, who joined Amazon when it acquired Covariant, the AI robotics startup he helped found.
In a statement provided to PYMNTS, Amazon said it continues to invest and support the Nova models, including Nova Forge, which allows businesses to build their own models.
“As with any AI portfolio, we continually evolve our model lineup based on what customers need, and we always provide customers clear guidance and migration paths as models advance,” the company said. “We generally support our models in production for extended periods because this is important to our customers. We’re also investing in the next generation of frontier model research, and Amazon’s commitment to building advanced AI models is as strong as it’s ever been.”
The news follows a report from Reuters last week that Amazon founder Jeff Bezos was calling for a revamp of the Prime Video streaming service to offer users a better idea of the company’s AI capabilities.
In other Amazon news, recent PYMNTS Intelligence research shows that an increasing number of consumers took part in the company’s recent shopping event—and that of rival Walmart—even as spending on both events fell.
“That trade-off offers a preview of the next phase of promotional retail,” PYMNTS wrote last week. “The biggest shopping events may attract more people than ever, but they are also becoming less capable of concentrating consumer spending in one place.”
