In a market dominated by giants like Apple and Samsung, OSOM, the ambitious successor to Essential, was founded with a mission to stand out by doing things differently. Led by Jason Keats, a former head of research and development at Essential and an early team of industry veterans, OSOM had a radical focus on privacy, security, and cryptocurrency. But now, just four years after its inception, the company is preparing to shut down, marking the end of a promising yet ill-fated venture.

A Start with Great Promise

OSOM, which stood for “Out of Sight, Out of Mind,” was launched in 2020 as a direct continuation of Essential’s vision, following the abrupt closure of Andy Rubin’s original startup. Keats, alongside former Essential engineers, aimed to produce a smartphone that could carve out its niche by prioritizing user privacy—a feature sorely missing in an age of data leaks and pervasive digital surveillance. Their first project, the OV1 smartphone, was an embodiment of that ethos.

The OV1 was designed with robust privacy features, including a unique data-blocking charging cable that prevented unauthorized data transfers when plugged into unfamiliar sources. OSOM was clearly intent on changing the status quo, offering consumers not just a sleek design but a promise of secure and private digital experiences.

But despite its innovative stance, OSOM quickly ran into challenges that would prove insurmountable. A partnership with Solana in 2022, at the peak of the cryptocurrency boom, led to the OV1 being rebranded as the Saga, a crypto-powered smartphone. Built with integrated Web3 functionalities and tools to manage NFTs and digital wallets, the Saga was designed to be the go-to device for crypto enthusiasts.

Crypto and Market Realities

What OSOM couldn’t predict was the dramatic collapse of the cryptocurrency market soon after the Saga’s announcement. As major crypto exchanges and investment firms fell apart, consumer interest in blockchain technology dwindled. What had initially seemed like a promising niche for a cryptocurrency-powered smartphone suddenly became irrelevant.

By the time the Saga hit the market in 2023, the buzz around cryptocurrencies and NFTs had largely faded. OSOM was left with a highly specialized device that catered to a shrinking audience, while the broader consumer base continued to favor mainstream smartphones from Apple and Samsung.

On top of that, the smartphone market had matured to the point where new entrants faced nearly impossible odds. With mobile carriers in the United States tightly controlling the smartphone distribution pipeline, OSOM struggled to secure partnerships that would have put its devices in front of mainstream consumers. Without those carrier relationships, OSOM’s innovative devices were essentially invisible to most potential buyers.

Scandal and Legal Woes

OSOM’s downfall took an even more dramatic turn recently with the filing of a lawsuit against Jason Keats by a former executive of the company. The lawsuit, which came to light just weeks ago, accuses Keats of misusing company funds for personal luxuries—including the purchase of two Lamborghinis. Although Keats has denied the allegations, the timing of OSOM’s closure has raised eyebrows. Was this the final blow for a company already teetering on the edge?

For a startup that prided itself on transparency and privacy, these allegations came as a shock to industry observers. While the lawsuit may not have directly led to OSOM’s shutdown, it certainly accelerated the company’s decline at a time when it needed stability more than ever.

The Harsh Reality for Smartphone Startups

The demise of OSOM serves as a stark reminder of the challenges faced by even the most innovative startups in a highly competitive and saturated industry. Entering the smartphone market as a small company is no longer about building a better product—it’s about building an ecosystem, securing carrier deals, and competing with tech behemoths that control much of the supply chain.

For American manufacturers like OSOM, the odds were especially grim. The vast majority of U.S. consumers purchase their phones through telecom operators who hold immense power over which devices succeed or fail. Without a foothold in that ecosystem, OSOM was always swimming against the current.

As OSOM prepares to wind down operations, it plans to release a final software update for its OV1 and Saga devices, fulfilling its contractual obligations to Solana. After that, only a small team of developers will remain, likely closing the chapter on one of the most interesting, albeit short-lived, efforts to redefine the smartphone landscape.

Lessons from OSOM’s Fall

While the closure of OSOM may be disappointing to privacy advocates and crypto enthusiasts, it offers important lessons about innovation, timing, and the evolving tech landscape. No matter how forward-thinking a product may be, success in today’s market often depends on factors far beyond the technology itself. Distribution channels, partnerships, and the shifting winds of consumer interest all play a pivotal role in determining the fate of even the most groundbreaking ideas.

OSOM’s vision may have been ahead of its time, or perhaps it was simply the victim of unfortunate timing and external market forces. Either way, its story serves as a poignant reminder of the volatility of the tech world and the razor-thin line between success and failure.

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