Amazon's Echo devices are proving very popular, but they also face increasing competition from rivals such as Google Home. The way to respond to competition is by improving the Echo/Alexa service. However, in order to do that Amazon is considering stepping into the risky area of sharing private data with third-party developers.
Amazon keeps transcripts of the chats you have with Alexa when using your Echo device(s). Those transcripts only happen when you use the "wake word" to activate Alexa. The rest of the time your Echo just listens waiting to be activated.
According to The Information and Engadget, it's those transcripts Amazon is currently considering allowing developers access to. The thinking being, if developers can see what consumers are saying to Alexa, they can produce better voice apps to use with Echo devices. Better apps means more potential for sales.
Right now, developers can see how often skills are used, how often you talk to an Echo device, and your general location. That data could be expanded to include transcripts, but nothing is confirmed yet. If Amazon did decide to go ahead with this, it would certainly raise a privacy concern. Developers would know your location, the skills being used, and what specifically you are saying to Alexa.
If it leads to Echo devices becoming more useful and intelligent I'm sure Echo owners would be happy. What they may be less happy about is what Amazon did to enable the improvements.