Unfortunately, Modu founder Dov Moran appears to be backtracking mightily from remarks he made when we first learned about Modu more than a year ago.

If you'll remember, Modu was once billed as a modular phone with dozens of "jackets" that could do everything from GPS to play MP3s. Additional hyperbole included the promise that the phone would be an experience that could turn the "one-size-fits-all" smartphone market "on its ear."

Now, however, Moran is talking only about the low cost, simplistic nature of the modu.

"Don't forget that billions of people are still using 2nd-gen devices and a lot of them don't need much more. People just want a small, light device that's easy to dial and send text messages. If you want an Iphone with a camera that makes coffee and can transform into a kite, and you're ready to pay thousands of Shekels for it - well, you have a big choice to pick from."

Yeah, but wasn't this thing advertised as the phone that could quickly and easily transform into whatever you desired? I kind of got the impression, ironically, that a phone turning into a kite was a Modu trick, not the iPhone. Guess that changed during focus group testing. [Calcalist via Mobo]

Word came to us today via a tipster, via Israel, via Google Translate, so proceed with much skepticism. That said, we do have an article citing Modu CEO Dov Moran, who says the modular handset is scheduled for launch in Southeast Asia in Q2 (as we reported in February). The report adds that the 200 Modu employees, in addition to churning out new phones, have been asked to swap their Nokia handsets for Modu ones.

As a refresher, the Modu concept is pretty simple: Take one tiny, tiny cellphone and build a number of "jackets" around it that do a variety of different tasks. One may be an "mp3 jacket," for example, while another could simply be a color palette swap for a night on the town. If you're still confused, think of the Wiimote and its many worthless white plastic sports-related accessories, except in this case the add-ons do something, like GPS.

Moran explains in a video from earlier this year:

Sadly, if this strikes your fancy and you live in the U.S. you're out of luck (for now). In the article, Moran only mentions Southeast Asia, Russia and other scattered territories outside the Americas. Personally, as I sit here today with my multitasking iPhone 3G laying lovingly at my side, I'm having a hard time getting worked up over the snub. [Calcalist (translated) via Talking Mobile - Thanks, Harel]

At the heart of the modu ecosystem is a tiny, modular and sleek mobile phone. In addition to complete mobile functionality, the modu phone is a music player and a mass storage device containing 2 GB of internal memory. The innovative modu phone presents a bold graphical user interface and a unique seven-key keypad to perform basic functions even without a modu jacket. For added functionality and style, users can easily slip the modu phone into a range of modu jackets. This modu ecosystem offers boundless – and affordable – possibilities.

The new modu jacket lineup includes:

• modu™ night jacket: inspired by the nightlife scene, this jacket includes futuristic styling with an edgy keypad, flashing lights, night mode imaging and a unique graphical user interface
• modu™ street-art jacket: capturing the expressive and vibrant street art scene, this jacket fea-tures stereo speakers and dedicated music keys for a powerful music experience
• modu™ classic jacket: designed to fit the everyday needs of a modern lifestyle, this jacket carries all essential mobile communication features with an air of elegance and fine taste
• modu™ express jacket: this jacket transforms the modu phone and user interface with a rain-bow of fun, playful flavors 
 
"modu is turning the notion of a ‘one-size-fits-all' mobile phone experience on its ear," said Dov Moran, founder and chief executive officer of modu. "Consumers want a mobile phone that can keep up with their dynamic lifestyles. The combination of the eye-catching modu phone with the new modu jackets offers not only personalized style but affordable updates without the costly expense of buying a new phone."

At its heart, the Modu phone is a simple cellphone (the lightest on the planet according to Guinness), but adding these jackets can completely change the functionality and aesthetic of the device—allowing the user to customize the device to his/her tastes. Modu expects to have these jackets on the market by Q2 of 2009, with several other jackets to roll out by the end of the year. If the previous info holds up, the phone plus two jackets will be available for only $200, with additional jackets running from $20 to $60—an agressive low price that could be key to its success. What do you think? Does Modu have a chance? [Modu via TechCrunch]

First of all, Modu will have to pull the support from service providers and third-parties. Right now it is getting it from Israel, where Modu hails from, and European companies like giant carrier Telecom Italia and GPS-maker Magellan.

Secondly, it's about the hardware. The product itself is almost there. The core module is very small and feels solid, with a simple domino-like user interface that is very easy to understand and use, with a micro-USB interface and a proprietary port on the bottom.

The current prototypes, however, only have two hours of talk time and three hours of music playback (with 72 hours' standby time). While very similar to other cellphones of this size, this is a design trade-off that, if not solved, may prove a challenge for Modu. The good thing is that the jackets have their own battery power, which is added to the battery of the core module. When the core module is inside a jacket you will, allegedly, have the typical battery life of whatever device Modu is impersonating at the time.

The tiny handset has a minimalist interface, is extremely light and responsive. The jackets, which have extra hardware and software to expand the phone's abilities, can convert it into a multimedia player, a big-screen PDA or gaming handheld, whatever you may think about. It can also add a personality to stand-alone devices. Their idea is that Modu will be the center of an inexpensive "gadget ecosystem," carrying your personality and data into both specialized and generic devices, like computers and TVs.

Think of it like a Nintendo cartridge, providing abilities and functions to the basic system. Instead of plugging into a console, however, it is the main system that gets inserted into the cartridge, a hardware envelope that may have bigger screens, different hardware input interfaces, extra storage, ports or any other features the hardware designers think about.

And these hardware envelopes are not just about functionality. Modu thinks that many consumers will be attracted to the idea of customizing their core modules with jackets that not only provide extra functionality but are also an aesthetic statement. Working with partners, Modu says there can be specially designed and branded jackets (think high-class fashion brands or sport teams) that will give users a way to customize their daily experience in any way they want.

The whole take-my-personal-data everywhere makes sense. It is, after all, what we are all doing on a daily basis with our regular phones and multimedia players. Apple has the same thing in mind with their home-to-go iPod patents—which have yet to arrive to an actual product—using the ubiquitous media player as a personal data pod that would allow you to bring your personal info, music, photos, favorites, hottest documents and passwords everywhere you go. Connect it to a computer and the computer will basically adopt your personality for as long as the pod is connected.

Modu wants the same thing—not centered around the computer but, rather, expanded into whatever device you may have on you. The difference between Modu and Apple, however, is that the Cupertino Massive already has its own ecosystem, which started with the Mac, followed with the iPod and, after the latter's raging success, spread through a multitude of devices that have iPod connectors.

In the case of Modu, we will have to wait to see who exactly joins the party and how the consumers respond.

As you can see, Modu can be operated on its own as a very simple cellphone or become a full-fledge multimedia phone, a portable media player, a car sound system, a full car GPS, a bike mini-GPS, a toaster or a fully armed, fully operational battle station. Maybe, not so sure about the later. The video shows the Modu being inserted into a MacBook Pro and I wonder if it uses a standard ExpressCard connector to work its magic.

The concept of carrying a small module with basic communications capabilities, holding your personal data so all these other devices can change personality is attractive. Specially since some devices could be shared with other members of your family. On the other side, it could be the dumbest, biggest flop in cellphone history.

In any case, we will be all over them like shareware. If only for the NES clickity-clack sound of getting Modu inside whatever jackets. The price is great too: $200 for the basic module plus two jackets. The company says it plans to introduce other jackets for $20 to $60, which is quite an agressive strategy. If they work well, collecting them may get more popular than picking Pokémons. [Modu via Business Week]