December 3, 2014
Amazon’s chief executive, Jeff Bezos, has admitted that he has made billions of dollars of failures on experiments, including the failed Fire Phone.
Amazon CEO Jeff Bezos holds up the new Amazon Fire Phone at a launch event, Wednesday, June 18, 2014, in Seattle.
December 3, 2014
Amazon’s chief executive, Jeff Bezos, has admitted that he has made billions of dollars of failures on experiments, including the failed Fire Phone.
Amazon CEO Jeff Bezos holds up the new Amazon Fire Phone at a launch event, Wednesday, June 18, 2014, in Seattle.
Bezos said that embracing failures was an important part of surviving and thriving as a modern business, commenting on projects from the Kindle to the “Prime Air” drone delivery service, which he said is more than a publicity stunt.
“I’ve made billionaires of dollars of failures at amazon.com. Literally,” Bezos told the Business Insider Ignition conference in New York, saying that it would be akin to having “a root canal with no anesthesia” to dwell on them.
“None of those things are fun, but they also don’t matter,” said Bezos. “What really matters is that companies that don’t continue to experiment – companies that don’t embrace failure – they eventually get into a desperate position, where the only thing they can do is make a ‘Hail Mary’ bet at the very end of their corporate existence. I don’t believe in bet-the-company bets.”
‘A few big successes compensate for dozens and dozens of things that didn’t work’
Bezos explained that many of his experiments that have paid off, including Amazon Web Services, Kindle, Amazon Prime, and Amazon Marketplace, have made Amazon what it is today and funded further experimentation.
“If you’re going to take bold bets, they’re going to be experiments,” Bezos said. “And if they’re experiments you don’t know ahead of time if they’re going to work. Experiments are by their very nature prone to failure. But a few big successes compensate for dozens and dozens of things that didn’t work.”
The Fire Phone is one such experiment that has not lived up to expectations, failing to sell and leaving Amazon forced to write off $170m on unsold Fire Phones.
Bezos says that he’s undeterred by the sluggish uptake, which Amazon says that it has learned a lot about, and that he believes it will success and even if it doesn’t it was conducting an experiment.
“I feel it takes more time to analyze something like that,” stated Bezos, saying that people should “stay tuned” as Amazon continues to iterate its smartphone offering.
‘Super clear about what kind of company you’re trying to build’
Another “bet” that has many speculating that it is just a publicity stunt and will never materialize into a real service is Amazon’s “Prime Air” drone delivery service.
Bezos said that Amazon is working hard on iterating the drone technology, but warned that the US is likely to fall behind in the new field as other countries more readily adopt commercial drone technology.
“You have to be super clear about what kind of company you’re trying to build,” Bezos said of the out-there experiment with drones. “We said we were going to take big bets. We said we were going to fail.”
Bezos not only takes risks with Amazon’s businesses, but his own personal fortune, of which he sunk a small $250m chunk of his $30bn net worth into the Washington Post last year.
“I didn’t know anything about the newspaper business, but I did know about the internet,” said Bezos of the purchase stating that he is “very optimistic about the future of the Post” despite seeing it as “hopeless” from the outside.
The “big change” is underway transforming the newspaper from a local offering focused on the US capital into a national or global news offering, according to Bezos who has rarely spoken about his investment in the past.
Courtesy: The Guardian
