Amazon's Fire Phone fizzled out because of Bezos's misplaced ambitions
Amazon spent four years developing a smartphone only to have it crash and burn -- and not in the way its name, the Fire Phone, would suggest. The device is a failure thought to have cost Amazon some $170 million in unsold inventory, and its unpopularity has led the company to shuffle the management of the Lab126 division that designed the device.
A report from Fast Company places much of the blame for the Fire Phone's failures on just one person: Amazon chief executive Jeff Bezos, who is said to have influenced every aspect of the device, sometimes ignoring protests from Lab126's product designers. It seems I was right to call the Fire Phone "Bezos's bozos" when the device first flopped.
Bezos seems to have been obsessed with releasing a smartphone that could compete with the iPhone and other established brands instead of playing to Amazon's strengths -- or at least offering a slightly-better-than-mediocre experience at a more affordable price point. As one of the three dozen (ex-)Amazon employees behind Fast Company's report said:
"He had this childlike excitement about the [dynamic perspective feature that would change a display based on a consumer's head position] and no one could understand why. Whenever anyone asked why we were doing this, the answer was, ‘Because Jeff wants it.' No one thought the feature justified the cost to the project. No one. Absolutely no one."The decision to include that feature despite its cost is uncharacteristic for Amazon. The company is known for building products as cheaply as possible so it can sell them to its customers at a lower price and make it up with digital content sales or repeat purchases. That's the secret to Amazon's success -- ignoring it for the company's first phone is odd.
And now the company is left with a $170 million write-down for a product it's basically giving away -- while including a free $99 annual membership to Amazon Prime -- to any consumers willing to use the device instead of purchasing an iPhone or Android device. (Yes, I know the Fire Phone runs a version of Android, and no, that's not the point.)
Bezos's plan to create a premium smartphone backfired. Instead of producing a high-end device consumers would desire, it led to an oft-mocked flop with no real purpose. Amazon is now in a worse place than it was when it didn't offer a smartphone, and unless the next iteration of the Fire Phone is a scorcher, it looks like Bezos's plan fizzled.
[illustration by Brad Jonas for Pando]