Translating Arrington

Let’s translate Michael Arrington’s announcement that the CrunchPad is dead:

It was so close I could taste it. Two weeks ago we were ready to publicly launch the CrunchPad.

I’m using “launch” here in a bold new way, as I will now make clear.

The device was stable enough for a demo.

The device was not stable enough for release.

It went hours without crashing.

It never went more than a few hours without crashing.

We could even let people play with the device themselves

Even people inside the company couldn’t use it without making it crash.

the user interface was intuitive enough that people “got it” without any instructions.

It was still way harder to use than an iPhone, despite having several orders of magnitude fewer features.

And the look of pure joy on the handful of outsiders who had used it made the nearly 1.5 year effort completely worth it.

People are really polite to you if you tell them that what they’re holding is worth 18 months of your life.

Our plan was to debut the CrunchPad on stage at the Real-Time Crunchup event on November 20 […] We’d put 1,000 of the devices on pre-sale and take orders immediately. Larger scale production would begin early in 2010.

We hadn’t even come up with a real launch date, but were perfectly willing to take the money of 1,000 optimistic suckers.

And then the entire project self destructed over nothing more than greed, jealousy and miscommunication.

The project failed due to gross mismanagement.

[…] Bizarrely, we were being notified that we were no longer involved with the project. Our project. Chandra said that based on pressure from his shareholders he had decided to move forward and sell the device directly through Fusion Garage, without our involvement.

I had no idea that people don’t hand out a cut of their profits without good reason.

This is the equivalent of Foxconn, who build the iPhone, notifiying Apple a couple of days before launch that they’d be moving ahead and selling the iPhone directly without any involvement from Apple.

I’m pretty sure everybody at Apple spends their days blogging and googling for their own name, like I do.

[…] We jointly own the CrunchPad product intellectual property, and we solely own the CrunchPad trademark.

So it’s legally impossible for them to simply build and sell the device without our agreement.

It’d take an incredibly incompetent businessman to make the legal arrangements so vague that his pet project could be taken away from him. I don’t feel incompetent, so the project must still be mine.

[…] Renegotiations are always fine. But holding a gun to our head two days before launching and insulting us isn’t the way to do that.

Negotiations are usually very fair and polite when one person has a loaded gun and the other doesn’t.

We’ve spent the last week and a half trying unsuccessfully to communicate with them. Our calls and emails go unanswered, so we can’t even figure out exactly what’s happened.

It’s almost as though they’re telling us to fuck off. Man, that’s some hard-core “renegotiation”.

[…] We will almost certainly be filing multiple lawsuits against Fusion Garage, and possibly Chandra and his shareholders as individuals, shortly. The legal system will work it all out over time.

Most good technology products require more legal input than technical input, anyway.

Mostly though I’m just sad. I never envisioned the CrunchPad as a huge business.

I’m going to distance myself from the project now.

And what’s really sad about all this is the incredible support we were getting from companies and people around the world to launch this device. A major multi-billion dollar retail partner has been patiently working with us for months, giving advice on manufacturing partners and offering to sell the CrunchPad at a zero margin to help us succeed in the early days. They were also willing to pay for the devices on order instead of 30 days after delivery, a crucial cash flow benefit that would allow us to ramp up volume without putting ourselves our of business. They were even willing to fly the devices from China on their own planes to eliminate our shipping costs. Intel, which would supply the Atom CPUs to power the device, has assisted us repeatedly with engineering and partner advice, and gave us pricing that was ridiculously generous given our projected first year sales volumes. Other partners were eager to promote and sell the device for little or no benefit on their end other than “supporting the project.”

I’m really well-connected, and my business plan rested on my ability to get lots of stuff for free.

We even had sponsors lined up to help us sell the device near our $300ish cost.

The goal was to sell the CrunchPad for $200. With big subsidies from manufacturers, no shipping costs, no retail markup, software built with volunteer labor, and no profit whatsoever, we weren’t even close.

And money wasn’t a problem, either. We had blue chip angel and venture capitalist investors in Silicon Valley waiting to invest in the company since late Spring.

I didn’t think hiring someone who knows how to manage a tech project was worth the money.

We were simply holding them off until we launched, to eliminate some of the risk.

I’m using the word “risk” in a bold new way.