Essential Phone Gets a Permanent $200 Price Cut

Posted on October 22, 2017 by Paul Thurrott in Android with 10 Comments

Essential announced this weekend that its first smartphone, the PH-1, is getting a permanent $200 price cut. Now, the unlocked device will cost a far more reasonable $499.

“One of our driving principles is that premium craftsmanship and the latest technologies shouldn’t be for the few,” Essential’s Niccolo de Masi writes. “We could have created a massive TV campaign to capture your attention, but we think making it easier for people to get their hands on our first products is a better way to get to know us.”

Android founder Andy Rubin formally revealed his new venture’s first product, the Essential Phone PH-1, in late May. And while I was really impressed by the hardware design, and by the plans that Rubin had for Essential as a company, I was a bit worried about the price: At $699, the Essential PH-1 was initially priced just $70 less than a comparable iPhone 7 Plus.

“It’s still pretty expensive and doesn’t quite hit the same value point as did the Nexus 6P and 5X,” I wrote at the time. “OnePlus does a much better job here. Perhaps the firm will release a mid-market device in the future as well.”

I know I often harp on price. But when it comes to an unproven company like Essential, you need to do something to incite customers to give you a shot. OnePlus prices its phones correctly. Google used to, with some Nexus models, but no longer does with its Pixel handsets. Microsoft never did this correctly either.

Since that initial announcement, Essential has been racked by controversy, and that’s a great reason to not get too excited by this price cut. In late July, it said that it would Essential Phone in “a few weeks.” Then, three weeks later, it said that it was finally on the verge of shipping the first preorders. By the end of September, a market researcher claimed that Essential had only sold 5000 phones.

So here we are less than a month later, and Essential has woken up to the fact that it cannot support the premium pricing models used by market leaders like Samsung and Apple. And it’s even doing right by its early adopters: Anyone who did pay $699 for an Essential PH-1 will now get a $200 credit that they can use towards an Essential 360 Camera or another Essential Phone. That’s fantastic.

But this also reeks of an inventory flush, doesn’t it?

And that can mean only one of two things. That Essential will quickly replace the PH-1 with an improved model. (Perhaps much needed, given that the camera in the PH-1 has received poor reviews.) Or worse that Essentials is about to disappear for good. Which, let’s face it, is very possible.

So we’ll see what happens. But this is the price that the PH-1 should have launched at. And while I was initially excited by this smartphone and still very much support what Mr. Rubin and Essentials were trying to accomplish, I’m not convinced that this company will survive, let alone thrive. And I wouldn’t touch this phone right now, not even at this price.

 

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Comments (10)

10 responses to “Essential Phone Gets a Permanent $200 Price Cut”

  1. CaedenV

    wow, I thought the $200 price cut would have you sold. Must be pretty rough then.

  2. Bats

    Somebody needs to teach Paul economics. There is no such thing as "pricing correctly." There is only such a thing called Supply and Demand. OnePlus has no choice but to undercut Samsung in order to attract buyers of their handset. Essential has no choice but to cut their price because no one is buying it. I bet my life that the 5,000 people who bought the Essential are tech guys, who actually know who Andy Ruben. Again...it's called Supply and Demand. As for price, people are not buying certain phones for the price. Are you kidding me? Price is not even an issue for phones. Paul does not know this because like all tech guys, they find value by simply buying the phone outright. Regular/normal people don't do that. They either buy a phone due to a subsidy that they are getting (as in the old days) or by monthly payment. People put an expensive Samsung phone in their pocket, for only about $30-$40 per month. In addition, I have seen all the major carriers offer promotions on Samsung phones, like "Buy a Galaxy S8 and get one free." LOL....it's true, there are actually BOGO offers for these phones.


    However, Google is different and for some reason, Paul still doesn't get it. Google with Nexus was a partnership with other phone manufacturers. It was a collaboration effort between Google and whoever (phone manufacturer) they were working with. With Pixel, it's 100% Google and 100% Android, the most popular OS on the planet. There is no collaboration or partnership with anyone.


    To suggest that certain companies should price their products because of the popularity of their brand is not just ridiculous, it's just outright stupid. Essential is not like Google. I have not seen one...ONE commercial on tv for the Essential phone. If Microsoft can flood the tv airwaves with commercial after commercial with celebrity endorsements for Windows Phone and fail miserably, then a company such as Essential doing nothing to promote their products....I am not surprised that it is failing. LOL...however to suggest that price was a factor in failings. LOL...no.


  3. skane2600

    So a $200 credit toward buying an accessory they were probably not going to buy anyway or a redundant second phone. Sounds like a class action suit settlement rather than a refund.

  4. MacLiam

    Wisdom of the ages, page 1: You never get a second chance to make a first impression. The company is not necessarily cooked, but Essential Phone 1 is probably a goner. If Essential Phone 2 can be hustled out at the new price with a couple of seeming enhancements and no emphasis on distracting attachments that undercut its "essential" labeling, maybe it will have a chance. Since Project Fi capability is (at least in my view) an essential component, that should be there too. Come on, Essential Team! Cut a fast deal with Google about that. If buyers don't want it, they don't have to use it. But the option needs to be there.


    Right now my two year old Nexus 6P is a more essential phone to me than the one under discussion here. Since it is nearing EOL despite functioning perfectly, I have had my eyes open for a possible replacement sometime in the coming year. I had hoped to include this device on the list of candidates, but right now odds are my next phone is going to be a Pixel 2 or 3.

    • Polycrastinator

      In reply to MacLiam:

      This is definitely the case. If, as Essential has claimed, the poor camera quality is simply due to software that is not fully optimized, they should have held off releasing the phone until the software was right. Review sites aren't going to go back and do test shots, so the only evidence that consumers have to go on is the initial batch. I was really excited by the Essential Phone. I love the design, I like that it's almost pure Android, but it's not available on my carrier of choice, and a poor camera is a dealbreaker for me. I'm sure other folks have similar concerns.

      And seriously, why would anyone release a phone as a Sprint exclusive these days? It seems like the fastest way to make a phone fail.

  5. Hougaard

    Soo.. I'm one of the "early adopters" :) What attracted me to the Essential, was the compact size and the fact that it's running stock android.


    The phone I got had some quirks, the camera performance was sub-par and the phone had a tendency to ignore touch after a usb disconnect.


    Then we got the "81C" firmware upgrade (OTA) together with an update to the camera app and everything changed. The phone is now rock solid and I have no issues. The camera is perhaps not up to Lumia levels, but I do find myself enjoying having a true black and white camera with me (Guess that's the old photographer speaking)


    I do believe, that if reviewers tried the "81C" version, the overall impressions of this phone with be totally different, but that ship has properly sailed...


    Anyway, I'm gonna use my $200 credit to add the 360 camera :)

  6. jgoraya

    I'm pretty much sold on this. I'm hoping that there is a deal that pops up where I can get this for about $450 between now and X-Mas since i have no issues with my 5X. I'm not a big photographer so just having an OK camera is fine with me, but a Snapdragon 835 processor, 128 GB space, near bezel-less screen, high end casing (ceramic and titanium), and it works on Verizon! Seems perfect for my needs.

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