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Luxury Phone-maker Vertu Collapses (bbc.com)

Posted by msmash on from the end-of-road dept.

A British-based company that made smartphones costing thousands of pounds will be liquidated after a plan to save it failed. From a report: Vertu was known for its high-end, jewel-encrusted handsets, but recently faced financial difficulties. The company's liquidation will result in the loss of nearly 200 jobs. One technology analyst said Vertu would have faced competition from companies offering to customise other smartphones with precious materials. Vertu phones carry hefty price tags -- its Signature range starts at 11,100 pound ($14,350) and one model featuring 18-carat red gold costs 39,100 pound ($50,600). When contacted by the BBC, an external spokesman for the firm said: "Well it's gone into liquidation and I'm not being paid by them any more."

66 comments

  1. Lesson Learned by Anonymous Coward · · Score: 0

    Lesson Learned: Gold plated commodity things are still just commodity things.

    1. Re:Lesson Learned by TWX · · Score: 2

      Even worse, by the time the company got done designing then implementing the gold-plating and vajazzling, the phones were already obsolete, and the final nail in the coffin was the ability to produce replacement backs and cases by the tens of thousands in whatever color or print or texture that the user wanted, purchasable for $10-$100 each.

      The only people that would buy what this company made are buying for the express purpose of showing off. Even among the rich that number might be fairly small as you have to be obscenely rich in order to spend money that frivolously without it starting to affect your bottom line, and even then not all obscenely rich people spend like drunken sailors on shore leave.

      --
      Do not look into laser with remaining eye.
    2. Re:Lesson Learned by Oswald+McWeany · · Score: 3, Insightful

      No matter how much money you have; you'd have to be a real pretentious douche bag to buy one of these. And a real pretentious douche bag to sell one of these.

      If I saw someone using one of these there would definitely be an urge in my gut to punch him in the face.

      --
      "That's the way to do it" - Punch
    3. Re:Lesson Learned by msauve · · Score: 1

      "No matter how much money you have; you'd have to be a real pretentious douche bag to buy one of these."

      So, their market was the extended Kardashian family? That's large enough that I don't see why they went out of business.

      --
      "National Security is the chief cause of national insecurity." - Celine's First Law
    4. Re:Lesson Learned by Anonymous Coward · · Score: 0

      I don't know ANY insanely rich people who spend money like a drunken sailor on shore leave. That's why the expression is "spend money like a drunken sailor on shore leave" and not "spend money like an insanely rich person."

      The insanely rich don't get insanely rich by making poor financial decisions. Even the very rich, really rich, moderately rich, and kinda rich don't get that way by spending frivolously.

      However, in most cases, the NOT-rich DO get that way by spending frivolously. It's pretty crazy. I know people with quarter million a year joint income living in 5000 square foot homes who can't afford a mattress for their kid to sleep on because they have a $70k truck and a $100k boat out in front of their $750k home and a $100/day restaurant and wine habit.

    5. Re:Lesson Learned by courteaudotbiz · · Score: 1

      Douche bags are not rich, they only pretend to be so by showing off some false bling bling. This is why Vertu's shit didn't take off.

      Real rich people tend to keep an eye on what they're spending money on. This is how they usually got rich. More revenue than expenses.

    6. Re:Lesson Learned by stud9920 · · Score: 1

      That's $920k in assets, all of which can be paid off at $100k a year in 10 years, leaving $150k a year or $500 a day or $400 after the wine. Even a $5000 mattress is only $1.3 per day over these 10 years

    7. Re:Lesson Learned by Anonymous Coward · · Score: 0

      No the lesson won't be learned, even though it should. Nearly any luxury maker of anything will go under. Exceptions might be a few entities like Rolex, Rolls Royce, etc, they have enough lower end products that you don't have to be stupid or super wealthy to afford.

      But luxury technology, like phones, computers, smart watches, and anything those ding bat celebrities stamp their name on are for stupid people. Yes, Gwyneth Paltrow and Kate Hudson, we're talking about you. Your product lines and business ventures can only stay afloat if the common person buys your shit, and shit it is. Your wealthy, famous friends can only buy so much of your useless junk and after that you'll be out of business. Except that you'll probably keep dumping your own money into your failing business venture to make it look successful to keep the egg off your face.

    8. Re:Lesson Learned by bitoffish · · Score: 1

      Good, good. Let the hate flow through you.

    9. Re:Lesson Learned by HornWumpus · · Score: 1

      Do you know where that eggs been?

      --
      John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
    10. Re:Lesson Learned by tietokone-olmi · · Score: 1

      Conversely, commodity things are no better with arab-approved bling-bling.

    11. Re:Lesson Learned by rogoshen1 · · Score: 1

      slightly ashamed to know this, but those 'fabletics' brand leggings are doing pretty well, she'll likely make more from that venture than her acting career.

      Yoga pants sold columbia house style; god bless the USA.

    12. Re:Lesson Learned by TimHunter · · Score: 1

      Rich people have money. Poor people spend money. I'm always surprised by the things that people would rather have than money.

    13. Re:Lesson Learned by 110010001000 · · Score: 1

      Vertu has founded in 1998. They lasted pretty long. I would call them successful in the tech world.

    14. Re:Lesson Learned by Anonymous Coward · · Score: 0

      Your math is a bit off. With interest, that house alone will cost $100k/year for 10 years. Add in just the two other luxury items listed and you're at around $120k/year for 10 years. Assuming that the income stated is pre-tax, income tax will probably take another 20-30%, so let's say 24% for this exercise. That's $60k, leaving us with $70k/year or about $190/day. Subtract the stated $100/day for food and you're left with $90/day, not $400/day. And it's doubtful that the house, truck, boat, and food/wine are the extent of their expenses. Add in another car or two in the garage, home furnishings (minus a mattress for the kid) bought on credit (with only the minimum payment made each month), and more loan interest and they could very easily be spending more than they take in.

    15. Re:Lesson Learned by turp182 · · Score: 1

      I wouldn't go for a punch in the face, but an "accident" whereby I knocked the phone to the ground.

      Pretentiousness broken. My tears they fall.

      --
      BlameBillCosby.com
    16. Re:Lesson Learned by TWX · · Score: 1

      The exceptions are the children of the uber-wealthy. The ones that didn't have to work for the money and generally seem to make occupations of spending for its own sake.

      --
      Do not look into laser with remaining eye.
    17. Re: Lesson Learned by Anonymous Coward · · Score: 0

      I live in the bay area, where a $100k and a $20k car will get you there in the same time. Wealthy people aren't driving the $20k cars.

    18. Re:Lesson Learned by Anonymous Coward · · Score: 0

      I love how you hold yourself out as an expert on douchebaggery. Knowledge hard won, no doubt. Or are you pulling it out of your ass?

    19. Re:Lesson Learned by phantomfive · · Score: 2

      If I saw someone using one of these there would definitely be an urge in my gut to punch him in the face.

      You have issues, tbh

      --
      "First they came for the slanderers and i said nothing."
    20. Re:Lesson Learned by houghi · · Score: 1

      Sounds as if you are pretty pretentious yourself.

      --
      Don't fight for your country, if your country does not fight for you.
    21. Re:Lesson Learned by thegarbz · · Score: 1

      That's a lot of anger about someone else buying something. I think there's a word for that. Let's see...
      Pretentious douchebag would be quite fitting to describe you.

    22. Re:Lesson Learned by ctilsie242 · · Score: 1

      Even then, a phone isn't exactly a conspicuous consumption device. From what I see, Louis Vuitton is making money hand over fit with their "Eye Trunk" case which goes for quad digits. A good iPhone case would have gotten more income than a phone. Especially if the case had a Bluetooth item with the concierge button or other niceties.

      The problem is that Vertu wound up in a market that was "neither fish nor fowl". If they sold expensive, bespoke, phones designed from the ground up for the individual, similar to how Prevost and Newell make buses, and sold them for six digits, they would still be around. If they sold phones for 50-100% above the normal rate mass-produced (perhaps by some OEM/ODM out of Taiwan or Japan), and sold them in volume, they likely would have a decent business model. However, for a phone (which is a mass produced, disposable, gadget with an expiration date), it doesn't make sense to charge high prices.

      Vertu might have been better off designing a "timeless" smart watch, where it would be self-winding, use a capacitor instead of a battery, using a very low power screen, minimizing the amount of apps (or complications) to save battery life.

      Or, they could have done something unique: Vertu could have made a PDA which connects to the user's phone via Bluetooth. This device would not need to have state of the art stuff on it, but designed from the ground up for being timeless and elegant. That way, the "common" smartphone can remain in a pocket or purse, while the PDA, a status symbol, could be used. Then, Vertu could look at early PalmOS, which was designed to be simple, yet effective, and design a device around it, perhaps with the capacity for voice transactions (via Bluetooth like the HTC Mini). That way, they would have something unique to sell that would last a long time (when the smartphone gets tossed, re-pair with the new one, continue as before.)

    23. Re:Lesson Learned by Plumpaquatsch · · Score: 1

      Lesson Learned: Gold plated commodity things are still just commodity things.

      Actual lesson learned: gold plated phones sell great until you switch over from Nokia to Android.

      --
      Of course news about a fake are Fake News.
  2. Hmmm... by drew_92123 · · Score: 1, Insightful

    "HA! HA!"

    - Nelson Muntz

    1. Re:Hmmm... by Oswald+McWeany · · Score: 1

      "HA! HA!"

      - Nelson Muntz

      It's amusing that that is the first thing that came to my mind too!

      Not much sympathy from me.

      --
      "That's the way to do it" - Punch
  3. How do you like them Apple's? by Anonymous Coward · · Score: 0

    "You can be watching TV and see an iPhone, and you know that the President uses an iPhone, Liz Taylor used an iPhone, and just think, you can have an iPhone, too. An iPhone is an iPhone and no amount of money can get you a better iPhone than the one the bum on the corner is using. All the iPhones are the same and all the iPhones are good."

    1. Re:How do you like them Apple's? by Anonymous Coward · · Score: 0

      >All the iPhones are the same and all the iPhones are crap.

      Fixed that for you.

  4. It wasn't the plating or outside... by LynnwoodRooster · · Score: 4, Interesting

    It was the concierge button. THAT was what made Vertu great. You push a button, you're instantly connected to a personal concierge who would arrange whatever you needed. Dinner reservations, flights, flower delivery, dry cleaning, etc. The Vertu phone came with a lifetime concierge-on-demand service. What killed it was the expansion of Google Voice/Siri type apps and integration with other vendors. You no longer needed a human to do that for you...

    --
    Browsing at +1 - no ACs, I ignore their posts. So refreshing!
    1. Re:It wasn't the plating or outside... by phayes · · Score: 2

      "lifetime concierge-on-demand service": So how is that "lifetime" service doing now that they have shut down?

      --
      Democracy is a sheep and two wolves deciding what to have for lunch. Freedom is a well armed sheep contesting the issue
    2. Re:It wasn't the plating or outside... by Ryanrule · · Score: 1

      Siri isn't arranging a hooker or getting drugs lined up for the private jet.

    3. Re:It wasn't the plating or outside... by captaindomon · · Score: 1

      Rich people already have concierge services. Semi-rich people use Amex Platinum or Amex Centurion for example. Really rich people have assistants that work for them. They are on speed dial. Sometimes the rich person asks their assistant to put their other assistant on the phone, and they don't even dial themselves. That button is something that sounds like a rich person's dream to people that aren't rich.

      --
      Just because I can hook a shark from a boat, I do no offer to wrestle it in the water.
    4. Re:It wasn't the plating or outside... by courteaudotbiz · · Score: 1

      They're dead, so their lifetime is over. Isn't it how it works?

      Anything that pretends to be "lifetime" should be looked at with circumscription. Garmin maps may be an exception, but I can't see how a one time purchase can pay for the salary of a concierge forever.

    5. Re:It wasn't the plating or outside... by freeze128 · · Score: 2

      Any phone can call a concierge. Just add the contact to your favorites....

    6. Re:It wasn't the plating or outside... by Oswald+McWeany · · Score: 1

      I can't see how a one time purchase can pay for the salary of a concierge forever.

      They don't intend to. They know that phone replacement is over 50% by year 3. By year 5 almost all phones are replaced.

      They probably also know that they only need one concierge working per 200 phones sold. Overall, it's not that expensive compared to the overall cost of the phone.

      --
      "That's the way to do it" - Punch
    7. Re:It wasn't the plating or outside... by HornWumpus · · Score: 1

      I want to be rich enough to have a 'pussy coordinator'.

      Apparently he pays the whores, so the rich fucker can pretend he's a player, not a john.

      I don't want to employ a 'pussy coordinator', just be rich enough that I could.

      --
      John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
    8. Re:It wasn't the plating or outside... by squiggleslash · · Score: 1

      I had Orange (a UK mobile phone operator) service in the late 1990s, and the plan - at that time - included a similar service, only not free. Used it once (and only once - I wasn't rich) to ask them to find out if a particular restaurant was open and get a taxi for some friends and I to take us there. Wonder if they (or rather their successor, I believe they merged with T-Mobile UK fka one2one) still do it?

      You might think "That's what Google is for!" but... it's not really what Google is for, Google could have answered a series of questions and helped me organize that, but it'd still have been me organizing that. Given I was drunk at the time, had Google and Android been around in '98 I don't think it'd have gone so smoothly.

      --
      You are not alone. This is not normal. None of this is normal.
    9. Re:It wasn't the plating or outside... by estestvoispytatel · · Score: 1

      As far as I remember, concierge service was not so life-time, but rather free for the first year, then paid extension contracts. Maybe it was longer for the senior models, can't recall immediately. Their smartphones were quite ok in the slow times of early Android, quality and all, they were among the first who embed the serious suite of solutions for privacy and security. Of course, their diamond-plated dumbphones were ridiculous from the start and get worse with the variations of exotic leather and jems.

    10. Re:It wasn't the plating or outside... by Anonymous Coward · · Score: 0

      Conceptually they would charge enough money for the phone that they could invest enough that the concierge's salary would be paid by the interest on their investment. Practically they probably "invested" in themselves, and hoped to grow fast enough it never became a problem.

    11. Re:It wasn't the plating or outside... by I'm+New+Around+Here · · Score: 1

      Your Siri-fu is weak, old man.

      --
      If you think I voted for Trump because of this post, you're wrong. I voted for Dr. Jill Stein of the Green Party. Again.
    12. Re:It wasn't the plating or outside... by rtb61 · · Score: 1

      So how do you replace a diamond encrusted phone. Are there like nearly rich people who buy old phones that don't work well but look flashy or does it just end in a draw some where, so you can pull it out to feed you idiot ego a regular intervals. Sounds like the proper business is a concierge service for the spawn of the rich/greedy/egoistic/ugly and the poor/greedy/pretty/stupid, people to dumb and egoistic to do anything, and expert service on subscription for the useless but rich spawn.

      --
      Chaos - everything, everywhere, everywhen
  5. Nearly 200 jobs sustained by vertu by Anonymous Coward · · Score: 0

    Nearly 200 people were sustained by a luxury product sales worldwide.

  6. Verutu Maemo5 Linux, Ti body, and Sapphire screen by Anonymous Coward · · Score: 0

    Back when they were a Nokia property I heard of a prototype with Maemo Linux, a Ti body, and Al2O3 touch screen; it would probably have lasted forever. I have broken 5 N900s so far since 2009. Not sure if the story was true, in any case they went into production with a Symbian OS, but it would have been the geek dream phone. Instead I still use a Nokia N900 and dream of a day where we can buy GNU Linux phones again, this time without blob drivers.

  7. Contract by Anonymous Coward · · Score: 0

    How long a contract do I need to sign to get a free one from Verizon?

    1. Re:Contract by Anonymous Coward · · Score: 2, Funny

      How long a contract do I need to sign to get a free one from Verizon?

      6 months... ... your liver... both kidney's and your corneas.

    2. Re:Contract by courteaudotbiz · · Score: 1

      +5 funny if I had modpoints!

  8. Nothing Lost by Nothing2Chere · · Score: 2

    And nothing of value was lost.

    n2ch

    1. Re:Nothing Lost by Archimonde · · Score: 1

      Are you sure about that?

      I've actually read it here many years ago. There is this thing about luxury items. They are relatively cheap to make, using relatively cheap materials (say diamonds, they basically don't have some special intristic value) and sold for high price.

      The starting point is this: there must be some legal way to separate rich from their money the easy way. Luxury items (say vertu phones or diamond/whatever clad laptops) are great example of this. So the outrageous amounts of money these rich people want to spend is divided inside the company producing those luxury items. Even if the distribution of money inside of the company is a bit unfair, it is still better then for those rich people hoarding obscene amounts of money.

      I would gladly make some stupid stuff which only rich can afford, as I'm sure that my profit margins would be huge. Vertu guys probably thought the same.

      --
      Trolls are like broken clocks. They show the truth two times a day. The rest of the day they talk nonsense.
  9. Slow dimes. by Ungrounded+Lightning · · Score: 1

    Lesson Learned: Gold plated commodity things are still just commodity things.

    The other lesson learned: "Fast nickels are better than slow dimes." This was an extreme case of "slow dimes" for cellphones.

    Grocery stores know that one. You can run on razor thin profit margins if, on the average, you turn over your entire stock every three days or so. 121 (a year's worth) cycles of compound interest at one percent will more than triple the money invested in the stock. (Multiplies it by almost exactly three and a third.)

    --
    Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
  10. Man, and they say Slashdot hasn't gone downhill by Anonymous Coward · · Score: 0

    This has less relevance to me than the local Weenie Hut Jr. cancelling Taco Tuesday.

    And I never eat Mexican on Tuesday. That's when I have Fava Beans with a nice Chianti. And Liver. Tasty Liver.

  11. Target market is not rich people. by captaindomon · · Score: 2

    People that are actually rich just want the latest Android or iPhone. Their full time assistants buy it for them. They spend their money on other things that rich people appreciate, like buying power, acquiring competitor's companies, flying on private jets, etc. They don't need an app to dial a free assistant service, because even their private assistants have assistants. This was a phone marketed at people that want to pretend they are rich with their friends.

    --
    Just because I can hook a shark from a boat, I do no offer to wrestle it in the water.
    1. Re:Target market is not rich people. by GameboyRMH · · Score: 1

      Came here to say this. Even wasteful rich people think Vertu's phones are silly, it was that bad. The assistant service is redundant and there are jeweled phone cases out there for the latest high-end mainstream smartphones.

      --
      "When information is power, privacy is freedom" - Jah-Wren Ryel
    2. Re:Target market is not rich people. by Anonymous Coward · · Score: 0

      ... flying on private jets

      If you can fly on a private jet, you can afford this phone. So if those kind of people don't want to buy this phone, we can conclude the phone is ugly and sucks.

  12. If I wanted a luxury model, it won't be Vertu by Anonymous Coward · · Score: 0

    it will be the Blackberry from these guys (sorry copy and paste) https://www.technobuffalo.com/videos/blackberry-porsche-design-p9982-unboxing-and-hands-on/

  13. Re:Another OBAMA Hit! by Thud457 · · Score: 1

    sigh.
    no no no no no...
    Today's memesheet clearly lists "lazy millenials killing established businesses because the don't buy in to overconsumption" as the current paradigm.

    Also. What the world needs now is more luxury products to pry open the 1%'s pocketbooks.
    You can't have a consumer driven economy when consumers have no disposable income.

    --

    the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff

  14. This makes me very very sad. by Anonymous Coward · · Score: 0

    As a phone thief these things are like the golden ticket in charlie and the chocolate factory.

  15. Re:Verutu Maemo5 Linux, Ti body, and Sapphire scre by GameboyRMH · · Score: 1

    That day's probably never going to come, sadly. The N900's hardware is getting too outdated now, I've resigned myself to the fact that I'll have to use a rooted Droid 4 with a Linux chroot as my next phone. After that I'm hoping to put desktop Linux on an Ockel Sirius A with a sliding keyboard.

    --
    "When information is power, privacy is freedom" - Jah-Wren Ryel
  16. Conway mathematics by Anonymous Coward · · Score: 0

    121 (a year's worth) cycles of compound interest at one percent will more than triple the money invested in the stock. (Multiplies it by almost exactly three and a third.)

    HUH? This is a Conway alternative fact (aka Trumpian economics)

    $1.00 @1% compounded yearly yields $1.00 at the end of the year.
    $1.00 @1% compounded monthly yields $1.010045961 at the end of the year.
    $1.00 @1% compounded 121 cycles yields $1.010049750 at the end of the year.
    $1.00 @1% compounded daily yields $1.010050029 at the end of the year.
    $1.00 @1% compounded every second yields $1.010050167 at the end of the year.*
    *to within Excel f.p. accuracy, which may be crap in the last couple of digits, but it's sure
    not $3.50...

    1. Re:Conway mathematics by Ionized · · Score: 1

      $1.00 * 1.01 = $1.01 (first cycle)
      $1.01 * 1.01 = $1.0201 (second cycle)
      $1.0201 * 1.01 = $1.030301 (third cycle) ..
      this can be simplified to 1.01^x where x is the number of times you run thru the cycle ..
      $1.01^121 = $3.33 after 121 cycles

    2. Re:Conway mathematics by Ungrounded+Lightning · · Score: 1

      HUH? This is a Conway alternative fact (aka Trumpian economics)

      They're not compounding 1% per year daily. They're compounding one percent per three days every three days for 121 cycles.

      One percent a year compounded annually for 121 years would also yield $3.33. But grocery stores don't have to wait that long.

      If that's "Trumpian economics" it looks like Trump understands it somewhat better. Maybe that's how he turned a million or so he got from his dad into 3.5 billion - and then spent about the price of a pleasure yacht on starting up a successful run for the US presidency.

      --
      Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
  17. Bummer! by nospam007 · · Score: 1

    Even the pimps are getting replaced by the web.

  18. Ugh, who'd want to carry around by Anonymous Coward · · Score: 0

    a thousand pound phone?