Oh no, the end for Essential as we know it may be near, guys. According to a report out of Bloomberg, Essential has canceled the Essential Phone 2 and is looking to sell itself. The report says that Essential has hired Credit Suisse Group AG to advise on a potential sale and may already have interest from at least one suitor.
There isn’t a specific reason given for Andy Rubin’s company deciding that now would be the time to sell and a spokesperson would not comment about the future of the company to Bloomberg. But look, the original Essential Phone was a bust by all means. You know that weird people like me love it, but the phone was filled with all sorts of issues and required a steep and permanent price drop almost immediately in order for the company to move any inventory. Maybe the risk and cost of continuing on just isn’t worth it.
For now, Essential is said to be looking to sell the entire company, including talent, patents, and hardware products.
The report notes that Essential maybe only sold around 150,000 Essential Phones and spent more than $100 million developing it, as well as their other products. And speaking of their other products, Essential has reportedly moved their phone engineers over to their yet-to-be-released smart home product that was teased a year ago.
Ugh. This is pretty terrible news. While the original Essential Phone has its fair share of issues, it was something fresh in a sea of bloated Android phones from the same phone makers we’ve been critiquing for years.
Should we learn more, we’ll keep you updated.
UPDATE: Andy Rubin has already weighed-in, basically confirming that they have indeed canceled their new phone. His Tweet is obviously in response to the just-released report and acknowledges that the company doesn’t shy away from ending the life of a product to shift focus. What’s interesting here is that he suggests they are putting extra effort into “game-changing” products, which they must believe is their smart home hub.
UPDATE 2: The Information picked up an internal email from Rubin to Essential employees where he said that they are “working with bankers to raise money,” and that an acquisition might be a part of the discussions. He also seemed miffed by the Bloomberg story above, saying that leaks like that “will not position us well for optimizing” their fundraising efforts and that he is “going to focus on winning not whining.”
// Bloomberg
It’s a lot more than 3 or 4 that are making a profit, in fact most are outside of LG, HTC and a few others. But your overall point is correct, this industry is very tough for a new company especially one that priced themselves right out of the market from day one.
This should be a shock to no one.
Wasnt expecting this. Was actually expecting the Essential to become the Amazon phone at some point because they had a stake in it. Best feel and build of any phone I have ever had. They should have started with a killer “value” phone with the same build quality and built up from there. They would have had a shot at that point. Maybe they wouldn’t because it was Rubin but I would think Google would license their previous gen camera technology for a value phone offering which would have given them the time to build to the killer flagship. Was sort of planning on buying the PH-2, this kind of sucks but suspected something was up when there was no leaks even near the anniversary of the phone.
That sucks because I thought the Essential phone was a nice looking phone. I came very close to buying one. I was looking forward to seeing what the PH-2 was like.
i would in a heart beat. i’ve owned 2 of the 3 you mention and there is nothing special about them. i much prefer the hardware, feel & size of the PH-1 over the Pixel & S9+
It’s a mistake to assume that any percentage larger than 5% of global smartphone buyers are as finicky about their devices as anyone who actually takes the time to comment on a phone blog.
It’s clear why the phone failed… right? If you saw someone with one, you’d be all like, what is that, I see no logo, or name. Oh well. That guy has a Samsung “Droid” I’ll buy me on of those DROIDS on Sprint.
It’s missing the big, obtrusive “SAMSUNG” or “HTC” or even better, “VERIZON” on the back. Come on Andy, you should know better, you need big, letters screaming the name of your phone on the front, (top and bottom) and the back!! Them customers out there need to be corralled like cattle and need to know what everyone else is using.
/s
(*Note: The use of DROID and Samsung together was intentional, as was the use of DROID and Sprint, for a descriptive purpose of how dumb most customers shopping for smartphones tend to be.)
Nah, It was an overpriced phone to begin with.
If they had priced it at $399, it probably would have been a huge success, sh**ty camera and all.
I’d take the PH-1 over all of those phones. S9+ and OP6 are bigger than I want, and I just don’t like what Google’s doing with Pixels. The only significant complaint I have about it is no headphone jack.
That’s a shame, I really like my PH-1. I guess my next phone is back to being a OnePlus, assuming whatever they put out next still has a headphone jack. (the PH-1 taught me living without it sucks)
CALLED IT.
Lol, good luck with a smart home product. Google and Amazon have that tied up.
Rubin is such a sack of sh*t! You flopped hard and took your ball and went home. And somehow, I bet you’re still going to make money you slime ball!
Press F to pay respects.
Everyone’s opinion on this phone was oh I’ll just wait for the next one. Even after several improvements, being a beta participant, releasing more updates than any other oem and actively listening to customers. I saw this coming as I’m sure they lost a ton and couldn’t afford to gamble with a 2nd one.
I will offer to buy the company for $699, but will quickly drop my offer to $499, then to $399 (for one day only), but I then I will offer $449, and eventually back to $399.
While I feel for the employees during this turmoil…that was a pretty dang funny comment.
That’s pretty weak.
Looks like it was non-essential.
The fact that it had such crappy cameras turned me off.
Htc is next
But what happens when the phone breaks? I have a 3 year warranty started literally 3 months ago with this phone through Square trade.
If it breaks Square Trade will have you send it into them to “fix”. Then tell you it’s not repairable and send you a check for your purchase price.
LOL
I distinctly remember when he launched this company and people were asking him if this new phone manufacturer is in it for the long haul and not just a one-shot wonder he was like, yes we are going to be around for a long time and produce the best Android phones. LOL Typical tech start-up…develop a good product, get some attention, then sell all or patents to a bigger tech company and move on to the next moon shot project.
“While the original Essential Phone has its fair share of issues, it was something fresh in a sea of bloated Android phones”
But was it really “fresh”? It had a ceramic back, a notch, a lightweight skin, and reddit support 😉 . It seems like you were desperate to find a Moto replacement (even though Moto is still here) and this fell into those cracks. I’m not dumping on the Essential Phone at all. It seemed like another nice Android phone, but that is all it was, another nice Android phone. It is very hard to differentiate and iterate. Google is throwing pots of money into the Pixel, advertising the hell out of it, and they sold 3.9 million phones in 2017.
Yes, it really was “fresh”. It failed badly, no doubt, but it was a new take, especially in the US market. Name another ceramic-backed all-screen phone with support for all US carriers.
I can’t name another but it does not make this fresh. Case material will not move the needle. All screen is being used liberally here, too.
I might pickup the ph1 as a backup
Support might sunset quicker than you’d like. I’d get a Moto G6 instead.
That’s not that much better
Moto will still be in business.
The mod community is fairly active for this phone.
Pure Speculation – I think building up and eventually selling the company to Google (for BILLIONS) was Rubin’s original plan (maybe his sell to them would be to replace/supplement/jumpstart the Nexus/Pixel program). Rubin wanted to double-dip like Jeff Hawkins of Palm/Handspring and make BILLIONS. He’s probably angry that he because he feels he sold Android to Google too “cheap” only to see it take over the world and generates Billions of dollars for Google only a few short years later. If that was his plan, it’s gone to hell now. Essential was his way to really cash in. But Essential is now a failure. And what happened to those sexual harassment allegations where Rubin “took some time off”? And I remember when Rubin left Google he said he was going to focus on his true love – “Robotics”. That was BS.
Yep, Gekko. I was preaching Palm/Handspring/Hawkins et al all along when Rubin got the whole unnecessay Essential venture going.
And Rubin doing robotics is like Hawkins going on to do Numenta then putting a toe back into the mobile field with the Fooleo then disappearing off the face of the world.
Felt same way since day 1.
Spot on.
That plan was crushed when Google bought HTC. Google has no use for another smartphone company/brand.
Pixel is not selling in great numbers. Relying on the HTC failures to save them could be problematic. IF Essential was actually a big success, I could see Google buying them regardless of their prior acquisition of the HTC failures. Pixel will eventually need to hit a critical mass of sales success.
Pixel doesn’t need to sell in great numbers, it just needs to be profitable. Google currently sells about 5 million of them a year which is very good for them. Google only want 2 phones a year and to rely on their Android One partners like Nokia. Google bought the division of HTC that was already working on it’s Pixels, the rest of the company is still there and still failing. Even if Essential was a huge success I couldn’t see Google having any interest in them, it doesn’t make business since why they would want to buy another phone brand, especially one that is a competitor of the Pixel XL.
1. Pixel will eventually need scale in terms of sales in order to justify the business.
2. Google would not keep the Essential brand but roll the IP and staff into the Pixel program.
moot point now, not happening.
1. That would be true for a company like Samsung or Essential that needs their devices to sell in large quantities to justify being in business. Google is different though. They are a services and advertising first business.
2. If Google didn’t buy HTC Pixel the Essential deal could have happened as you state, but with HTC they have no need for an IP or staff (they got a 1000 employees in the HTC deal).
If only it had a better camera, the PH-1 could have been a home run.
The camera was awesome. It was hamstrung by the camera app that it came with.
Even after trying multiple camera apps, the banners was still subpar for today’s competition.
Not surprising to say the least. LG and HTC can barely hang, and they have cashola.
HTC *had* the cashola. They have no other revenue sources other than handsets aside from the fledgling VR business. And just because LG CAN afford to keep hemmoraging money from their handset business doesn’t mean they want to or will (see Sony).
Well that was quick. Smh
No…. If they had thrown in a decent IP rating on their next phone and a improved camera I was basically sold. This seriously sucks.
That’s pretty much all I was waiting for too.
Yep. ????
One less option that isn’t made of stupid ass “premium” glass…
The camera hardware was decent, it was the software that needed work.
exactly, if memory serves me it has the same exact hardware the the LG G6 which takes very nice pictures. I have ot say its sad to hear this tho. i really liek this device and was hoping for a nice update on 2nd gen. its nice having a non branded unlocked device for use on any network tha twas gettign fast updates and very quick monthly security updates.
Give me a break with that Generic response Andy. You guys couldn’t even ship the damn wireless charger….I doubt that “Home” product will even see the light of day. #disappointment
The wireless charger apparently ran into patent problems. That’s very different from just not finishing a product.
If you’re not selling a product you promised a year ago….you did not finish or deliver the product.
Right. Do not announce something or put it into production if you did not do your patent homework
And being stopped by outside forces is still a very different context for why.
It should tell you something that other companies have no problem with “outside forces” when it comes to selling wireless chargers.
It tells me something that you think the issue is just wireless charging. The phone doesn’t have wireless charging built-in, but if they’d done a Qi coil inside the body they’d still have had this lawsuit. The issue is with the modular connectors on the back and how they operate, people just fixate on the charging module because that’s the one they want.
It’s a PR statement, it’s specifically designed to tell you something while telling you nothing at all.
This saddens me, I was actually holding out for this phone before making my next upgrade.
Google should snatch up the phone division. Essential had a decent design and materials.
That is/was Rubin’s plan all along, IMO.
They spent over a billion for HTC engineers already….
But this isn’t a billion dollar company at all, probably $200M
Why pay $200 million for something they already have?
Yes!
It was ugly. See my picture for the reason.
I agree (regarding the notch). But since all phones are going to look alike soon, you can see that the back looked good. And the materials used (ceramic), man, they looked good. The software and the camera sank that phone. It got bad reviews.
That would be a terrible idea. They just bought HTC’s pixel line. They have no need for a failing company with a product that doesn’t sell. If anyone buys Essential, and that’s a big if at this point, it will be a Chinese or Taiwanese conglomerate like TCL, BBK, Lenovo or Foxconn.
RIP. I was hoping the follow-up to the PH-1 would be a contender for phone of the year.
It baffled me to hear that they ditched the gen2 phone over a smart home product…? Ok Essential, wtf are you drinkin…? It’s not like you were going to make something better than the Echo
Damn, who knows what they could have done with version 2. That’s unfortunate, rip
Probably nothing, hence the cancellation.
Hence why I said who knows what they “could” have done with version 2.
Hence why I said, “probably” nothing.
I highly doubt that as Essential had a patent for a no notch display and pop up camera. Similar to what we saw with the Apex concept phone. One would assume they had something planned.
They failed on the phone side. Rubin admitted it. They’re concentrating in other areas pending sale or raising more cash. Plans are plans. The Russians planned on going to the moon 50 years ago. They had done some pretty impressive spaceflights while making these plans. Plans don’t always come to fruition.