Essential is shutting down less than three years after the startup unveiled its first smartphone. The company’s only complete product, the Essential Phone, sold poorly and received mixed reviews. A follow-up phone was canceled, and a number of other promised devices — like a smart home assistant and operating system — never materialized.
The startup was founded by Android creator Andy Rubin. While that initially drew hype and investment, it quickly turned backward on the company after a New York Times report drew attention to accusations of sexual misconduct against Rubin that allegedly led to him leaving Google.
Essential was in the process of developing another phone called “Project Gem” with an unusual design. Rubin first teased the project in October 2019, but the company now says it has “no clear path to deliver it to customers.”
“Given this, we have made the difficult decision to cease operations and shutdown Essential.”
“Given this, we have made the difficult decision to cease operations and shutdown Essential,” the company writes in a blog post.
Essential is done issuing updates for the Essential Phone, though it says the device will continue to work. Newton Mail, which Essential bought in late 2018, will also be shut down. Essential says it will continue to operate through April 30th.
The news is supposed to have no impact on Playground Global, a VC firm Rubin founded that shares the same office space as Essential, according to an Essential spokesperson. A Playground spokesperson said the firm is “proud to have supported” the team even though “commercial success was elusive.”
When Essential debuted its first phone in 2017, it seemed to have a lot going for it. The device had a premium build quality, the backing of Android’s creator, and a unique nearly all-screen design with a cutout camera notch that hadn’t been seen before.
But the phone’s design very quickly became standard fare — the iPhone X was released just months later, and a wave of notch knock-offs followed. And the Essential Phone itself wasn’t helped by some faults of its own: it was a Sprint exclusive in the US, confining it to the smallest nationwide carrier, and its camera was widely criticized by reviewers.
Essential also promised a wave of accessories for a magnetic module system built into the phone, but only two materialized: a 360-degree camera and a headphone jack adapter, which sold for $149.
Even as the startup struggled with sales and development of new devices, it continued to support its original phone. Six months after launch, it put out three new color options, and the company continued to regularly update the phone’s software. As recently as September 2019, it was updated to Android 10 on day one of the operating system’s release.
Unable to break into the phone market with a traditional device, Essential started developing a much quirkier new device, seemingly hoping to strike a chord with consumers. It was never entirely clear what Project Gem would be good for, though. And apparently, Essential lacked the money — and interest from investors — to get it to market.