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Essential Phone is Looking Like a Flop

by Neil Mawston | Oct 23, 2017

Essential Phone, developed by Android creator Andy Rubin, has this week announced it will slash the retail price of its flagship smartphone by almost 30%, from US$699 to US$499. Demand has been soft and price is being cut.

The cut will come as no surprise to readers of this report, published back in June 2017 by our Handset Country Share Tracker (HCST) service. We predicted the Essential Phone was priced way too high for an unknown brand with modest carrier support and volumes were unlikely to takeoff.

Where does Essential Phone go from here?

In all honesty, the vendor's options look very limited at this point. Essential can cut prices even further, but that will just make it look desperate. The company can expand distribution channels with more salespeople, but this will take years of effort and piles of cash it may not have. Essential can do another big marketing push, but it has already gotten massive press coverage this year and sales have not taken off in the US or worldwide.

History shows that vendors who get their first "high profile" launches wrong rarely get a second or third chance. Consumers and carriers are unforgiving. For example, Palm's first smartphones were a failure, as were Microsoft's. Essential is looking very much like a flop and it may struggle to get a second chance.

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