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Modu no more

Modu, an Israeli company that offered a tiny cell phone for use with interchangeable jackets, will shut down in February.

The tiny Modu phone.

Almost three years after we first saw Modu at Mobile World Congress, the tiny phone maker will close down next month. According to the Israeli news site Ynet, Modu raised $123 million and owes $21 million to an Israeli bank in addition to unpaid employee salaries.

Modu caught a lot of attention at Mobile World Congress in 2008 when it introduced the idea of a tiny modular cell phone (smaller than a credit card, actually) that you could insert in a variety of interchangeable "jackets." The jackets would transform the Modu into fully functional phone with real controls and bring a different identity and feature set. For example, a music jacket would turn the phone into a music device and a style-centric "night" jacket would give the device an abstract keypad and flashing lights.

Though I always saw it as an intriguing idea, Modu landed only in its home country of Israel and a handful of other markets. So though I'm not surprised, it is a bit disappointing.