Amazon cloud boss Andy Jassy shares the important lesson the company learned from launching its failed Fire Phone

• On Wednesday at the Goldman Sachs Technology and Internet Conference, Amazon Web Services CEO Andy Jassy spoke about what Amazon learned from launching the now-shuttered Amazon Fire Phone.
• When it was released in 2014, sales were disappointing and Amazon had to close its operations, but Amazon was still able to learn from the team it hired, its plans, its customer conversations, and its technology.
• Jassy says that Amazon encourages employees to try new things, which was how AWS started.
• Visit Business Insider's homepage for more stories.

Back in 2014, Amazon launched its first mobile phone, the Fire Phone - but it failed to successfully take off.

The phone was a major flop. Many users, and even Apple CEO Tim Cook, were not impressed. After disappointing sales, Amazon had to take a $170 million write down and eventually completely shuttered its phone operations.

Yet, according to one of Amazon's top executives, the experience was "very culturally reaffirming."

"Those of you who may not have known, we launched a phone and it didn't exactly work," Andy Jassy, the CEO of Amazon Web Services, said at the Goldman Sachs Technology and Internet Conference in San Francisco on Wednesday.

Although the Fire Phone mission didn't pan out, Jassy says the work that Amazon put into it was still valuable, including the team it hired, its plans, its customer conversations, and the technology it built.

"Because we liked all the inputs, even though it didn't work, we took the learnings and the technology we can reuse and reapply it and then gave people a good landing spot," Jassy said.

Jassy said that at other companies, senior leaders may shut down new ideas, but he says at Amazon, it's the opposite. Not only that, in order to be successful, a company must be "willing to tolerate failure," he says.

"If you don't, all the great people will fear working on the new things because they'll worry they won't have a spot if it doesn't work out," Jassy said.

It's worth pointing out that Jassy's telling of the Fire phone experience may have a bit of a revisionist sheen on it. In the months after the Fire phone's demise, The Wall Street Journal reported that Amazon laid off dozens of employees associated with the project.

"We don't say yes to everything, but we say yes to a lot more than most"

Of course, Jassy was most likely not directly involved with the Fire phone. The veteran Amazon employee started Amazon's cloud business 14 years ago, creating a massive industry that Amazon now dominates.

And the cloud business, which Amazon could easily have dismissed or overlooked because it also had a retail business to run, remains the textbook example of a corporate culture that encourages employees to try new things.

"All the senior leaders will tell you that their favorite meetings are the ones where we listen to new ideas, and we don't say yes to everything, but we say yes to a lot more than most," Jassy said.

And for those who think Amazon should take another crack at smartphones, there's still hope. In an Amazon earnings press release in 2018, the e-commerce giant said, "we want customers to be able to use Alexa wherever they are," and an analyst says this could be a hint that Amazon might want to re-enter the phone market.

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