Modu

» see modumobile.com as it lived, on the wayback machine

~ the last words ~

The modular phone is an idea that gets rebuilt every few years by people who did not watch the previous attempt fail. Modu was the attempt before the one most people half remember. It went on sale in Israel in June 2009 and never came anywhere near a Turkish shelf, so what reached me was the sequel: the same pitch, a Google project name on it, no mention of the company that had already spent a hundred million dollars finding out how hard it was.

Dov Moran founded Modu in 2007. He was not a first-timer. He had built M-Systems, the company that put the USB flash drive into everyone's pocket, and sold it to SanDisk for around 1.6 billion dollars the year before. Money and press attention arrived without much effort. The device itself was a slab smaller than a credit card, 72 by 38 millimeters, 7.8 millimeters thick, and it weighed 40.1 grams. In March 2008 Guinness certified it as the lightest mobile phone in the world.

That record was the marketing, not the product. The module was never supposed to be used on its own. It held the radio and the SIM, plus whatever contacts and music you had loaded onto it, and you pushed it into an enclosure that supplied everything else. Modu called the enclosures jackets. One jacket gave you a keyboard phone. Another gave you a camera or a music player with different buttons and a different interface loaded off the shell.

~ the record ~

~ the jackets ~

The idea reads well on a slide. You buy the expensive part once and change the cheap part whenever you want a different device. Modu signed the partners that would make it real, with SanDisk on storage and Universal Music supplying content for the media jackets. Blaupunkt came in on the car side, so the module was supposed to slot into a dashboard and become the stereo.

The economics never worked. Every jacket was a separate manufactured object with its own tooling and its own place on a shelf, sold by someone who had to explain in one sentence why you would buy a phone that was not a phone yet. Modu was not selling a handset. It was asking an entire accessory industry to appear around a product that had not sold any volume yet, which is a chicken-and-egg problem nobody has ever solved by trying harder.

~ the fall ~

Israel got it first in June 2009, with Italy and Russia following. The reviews were kind about the engineering and unconvinced about the point. Meanwhile the market that Modu was designed for had stopped existing. The device was conceived in 2007, the same year the iPhone shipped, and by 2009 the question buyers were asking about a phone was which apps it ran, not which shell it fit into. A forty-gram module with a tiny monochrome-era screen was a beautiful answer to a question people had stopped asking.

The company raised over a hundred million dollars across its life and went for a public offering to raise more. The offering failed. By the end of 2010 there was no revenue path and no float, and the payroll had become the immediate problem rather than the roadmap.

~ the inheritance ~

In January 2011 employees who had not been paid filed a liquidation request with the Israeli courts. Operations stopped the following month. The numbers that came out in the wind-down were 123 million dollars owed to investors and another 21 million to Israel Discount Bank, which is a lot of money for a company that never shipped a phone anyone outside a few markets could buy.

In May 2011 Google bought the Modu patents for 4.9 million dollars, about 17 million shekels. Two years later Motorola, by then owned by Google, announced Project Ara: a phone assembled from swappable blocks that attached to a frame. Ara got three years of conference demos and was shelved in 2016. The patents Google paid five million dollars for went into a project that ended the same way the original had, which suggests the idea was the flaw and not the execution.

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