Seeking Alpha

Could Modu Be the iPhone Killer?

Includes: AAPL, WDC
by: Eze Vidra
Eze Vidra
Internet, software, media, gaming

There was little known about Dov Moran’s start up Modu when I covered it’s appearance at CES 2008 last month. At the time, speculations alluded to a mobile technology that allows users to transform electronics into mobile phones, or visa versa give mobile phone flexible capabilities of other consumer electronic devices. They weren’t that far off. Today, Modu unravels the mystery, by announcing its “Modular Cellphone” Jackets (the meaning is in the captured in the name), due to be released in October by mobile carriers in Israel, Italy and Russia. Modu will present its modular jackets at the GSMA Congress in Barcelona next week (Feb 11-14).

Could Modu be the iPhone killer?

The product looks revolutionary. The Modu Mobile is a tiny cellphone, 1.5-ounce, 2.8-inch-long, that can be inserted into multiple jackets that enhance its functionality. In other words, the modu has the basic functionality of a cell phone: antenna, cellular radio, contact list, text messaging capabilities and a battery. It is packed with a large memory stick (1 G), that carries over your personal data (contacts, photos, music and etc), onto other devices, using low priced “jackets” or “sleeves” such as car stereos, photo frames, car navigation systems, clocks, toasters, laptops, cameras and more.

Founder Dov Moran knows a thing or two about carrying data from one device to another - he was the founder of Israel’s M-Systems, the original maker of USB flash drives, that was later acquired by Sandisk (SNDK) for $1.6M. Moran invested $5M in Modu from his own capital, and was joined by Sandisk, that predicted $1 billion annual revenue in 2011. In the official press release, Dov Moran, said:

The mobile phone industry is ready for a revamp. There are hundreds of handset models on the market: the trouble is that as a consumer you can only have one at a time and you are usually tied to a long and expensive contract. modu is challenging that with a solution that offers freedom, boundless possibilities and the opportunity to change your phone without it costing a fortune.

In Modu’s own words:

Modu brings freedom and boundless possibilities to the world of personal communications. By creating an affordable, flexible, well-designed, undemanding communication experience, our innovative solutions benefit both end users and mobile operators. The company strives to become a global leader by enabling a new and exciting connected world. modu was established at the beginning of 2007 by Dov Moran - founder and CEO of msystems (NSDQ:FLSH), inventors and leaders of the USB flash drive market (DiskOnKey™), FlashDisk (DiskOnChip™).

A picture is worth a thousand words, here are some of Modu’s cellphone jackets (click to enlarge):

modu jacket modu jacket 2 modu jacket 4 modu jacket 3

Modu’s teaser video as featured on its website:

How can you get one?

First you have to be patient, it will take a while before it reaches the US. However, Modu will initially be sold with two jackets for $200, which could be subsidized by the operators to make it cheaper or even free. Additional jackets could cost $50 or less.

Disclosure: None