Why OSOM became web3 – TechCrunch

“I want to do something crazy stuff,” says Jason Keats, laughing. “I want to bring back the GEM phone.”

He reaches behind him and pulls the strikingly slim device off a shelf. The battery is dead, but as a prop, it still works. Essential released images of the prototype in October 2019 — roughly four months before the company closed its doors. All that’s left now is a handful of gadgets and the dreams of some of its co-creators like Keats, who founded OSOM a few months after Essential’s demise.

“It’s a new way of interacting with your device,” explains Keats. “It worked really well with one hand, with a big screen, a quality camera. It was so easy to use. And the length allowed us to have a good variety of antennas inside the device despite it being a small form factor.”

Photo credit: Significant

OSOM’s first phone, launched late last year, shares more design DNA with Essential’s first phone, the PH1. From a pure hardware design perspective, it’s not particularly adventurous. Keats casually notes that people have stopped him in the street to ask if it’s the iPhone 14 while he’s using it.

“Our first product needs to be a more traditional device,” explains OSOM’s co-founder/CEO. “You can’t say, ‘Here’s a crazy brand with a crazy thing.’ You’ll sell like five.”

So the Bay Area company went for a far more streamlined design with the OV1. It’s a premium flagship without the glitz of, say, Nothing’s first product. Among other things, it is a pragmatic framework on which the company can conduct future experiments – a sign of a reputable company selling a product due to serious concerns such as user privacy.

However, as we established last month, the OV1 will never see the light of day. In its place is Saga, a device from blockchain startup Solana that delivers the promise of a Web3-first mobile experience. It’s effectively the OV1 with a slightly different livery (one of Solana’s requests was the addition of green buttons to match the company’s branding) and the blockchain company’s web3 software stack.

Photo credit: OSOM

Keats says he was introduced to Anatoly Yakovenko through a mutual friend when the CEO of Solana Labs explained that the company was looking for a hardware manufacturer to realize its dream of a blockchain-focused mobile device. The couple chatted on Signal and met over coffee a week later.

“We found that there are such parallels between our areas and our visions for the future that are intertwined,” says Keats. “He needed someone who could build hardware and arrange for it to be made, who knew the players in Asia, to actually build a quality device. We needed a user and customer base who were excited about consumer choice, self-government and individual privacy.”

Keats won’t reveal details of the deal, only explaining that OSOM is suddenly a lot less worried about its future. “They are our exclusive launch partner and there are certain MOQs (minimum order quantities) associated with that. You invested in the company that guaranteed our future.”

The deal sees the release of the already-delayed device pushed back to “early 2023” from the fourth quarter of this year. With the extra months leading up to release, OSOM decided to upgrade the camera sensor and increase RAM and storage from 8/128GB to 12/256GB. Those numbers came with a price increase that pushed the device from its earlier promise of “well under” $1,000 to right around it.

Photo credit: Solana

“I said, guys, look, first device, sell it for $1,000 and show you’re selling a $1,600 phone for $1,000,” explains Keats. “That says a lot about what we are ready for. We’re trying to build that community and build a super premium phone. The other side of this is that it gives us a window to develop a lower cost version in the future.”

OSOM’s decision to partner from the start is understandable. The US phone market was considered unbreakable for a long time before sales began to fall. The launch of a new cell phone from a new wireless company seems like a recipe for disaster. Essential — with its pedigree and hype — reportedly sold fewer than 90,000 units in its first year of existence.

Keats cites Nothing founder Carl Pei’s talent for building an organic fan base as inspiration for OSOM’s attempts to break into the US market (Nothing is also making a big bet on crypto/Web3). The promise of a privacy-focused handset with good specs and vanilla Android sounds good, but does it all add up to a product that can really stand out in a mature and saturated market whose sales have consolidated among a few big players?

Photo credit: OSOM

A crypto-focused deal differentiates the product in a crowded market without a radical Hail Mary like the GEM design, which can then be served to Solana’s loyal fanbase. According to Keats, getting a deal in place at this early stage wasn’t crucial, but it certainly gives OSOM a lot more breathing room than it would otherwise have.

How long the exclusive contract with Solana will last is not clear. And while there are some concerns that such a heavy focus on the crypto market will serve to push the product off the shelf, Keats notes that users can uninstall the Solana stack if they’re just after a new Android device without search all that web3 stuff. Regardless, availability will be limited at launch as companies focus on getting the product into the hands of developers. More general availability will follow later.

“In the next month or two, they’re going to be announcing some pretty fun stuff for their developers and for early adopters,” explains Keats.

As for the future, besides the crazy form factors, one can look to various patents granted to Essential in its short lifespan. The list includes several that focus on imaging, including the drive to create an under-display camera that doesn’t suck.

“Some [the patents] we own now,” says Keats. “The ones I care about belong to OSOM. And we also submitted 20 or 30 at that point.”

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