Amazon has established a new team called ZeroOne, led by Xbox co-founder J Allard, tasked with creating "breakthrough" consumer products across both hardware and software categories, as reported by CNBC. The team, operating across Seattle, San Francisco, and Sunnyvale, California, sits within Amazon's Devices and Services division headed by former Microsoft Surface chief Panos Panay.
J Allard co-founded Xbox in 1998, playing a pivotal role in Microsoft's entry into the console gaming market with the original Xbox in 2001.1 As Chief Experience Officer and Chief Technology Officer of Microsoft's Entertainment and Devices Division, Allard was instrumental in developing the Xbox software platform, Xbox Live, Xbox Live Arcade, and Xbox 360.23 His leadership helped grow Xbox into Microsoft's fastest billion-dollar business in company history.1 Beyond his technical contributions, Allard focused on recruiting third-party developers and publishers to support the Xbox ecosystem.2 His impact on gaming earned him recognition as "The Most Important Person in Video Games" by Giant Bomb and placed him among "The Most Powerful Men Under 38" by Details magazine.13
ZeroOne's job listings reveal a strategic focus on smart home technology, with specific mentions of "computer vision techniques for a new smart-home product"12. This emphasis aligns with Amazon's established presence in the connected home market through its Echo devices and Alexa ecosystem. The team is recruiting for specialized roles in applied science, product marketing, and customer insights3, suggesting a comprehensive approach to developing next-generation smart home solutions.
The innovation group embraces a methodology centered on "design thinking, rapid experimentation, and building to learn"42, indicating an agile development process. This approach reflects Amazon's determination to create transformative products despite its mixed hardware track record, which includes successes like the Kindle and Echo speakers alongside less successful ventures such as the Fire Phone and Halo fitness tracker35. ZeroOne represents Amazon's renewed commitment to pioneering consumer technology beyond incremental improvements to existing product lines.
Amazon's hardware business has faced significant financial challenges despite widespread adoption of its devices. The company reportedly lost more than $25 billion from its devices division between 2017 and 2021 alone12. While Amazon has sold millions of Echo speakers, Kindles, and Fire TV Sticks, most users primarily utilize Echo devices for basic functions like setting alarms and checking weather rather than making voice purchases as Amazon had hoped1.
The business model for Echo devices followed a "Gillette strategy" – selling hardware cheaply with expectations of profiting from subsequent purchases1. This approach worked well for Kindle e-readers, which successfully drove e-book sales, but failed with Echo speakers where the anticipated voice-shopping revenue never materialized12. Under CEO Andy Jassy, who took over in 2021, Amazon has shifted focus toward profitability, discontinuing unprofitable products like the Amazon Glow video calling device and Halo fitness trackers while exploring new revenue streams such as a paid version of Alexa with advanced AI features12.
