I was very excited about Humane, all the way back as early as 2019. But the company’s first product, the AI Pin, has failed to capture my imagination. It feels like a product without clear direction and a marketing strategy that’s left me perplexed. Aside from the functionality (which is pretty limited), it costs $699 and requires a subscription for even the most basic functionality. They want it to replace the smartphone, but anyone clear-eyed can see that the smartphone isn’t going anywhere. Let’s get this point out of the way, the smartphone is almost certainly going to eat most of these dedicated AI devices. It’s just a matter of time before Google, Apple, and other manufacturers deliver these currently unique experiences to hundreds of millions of people overnight with software updates. But there is an opportunity at this point in time to make a big splash and potentially even find niches where a product could coexist with the smartphone.

Enter Rabbit. Rabbit is one of the hottest AI hardware startups right now. Earlier today they introduced the R1, their first product. I was extraordinarily skeptical ahead of the announcement, particularly because of the AI Pin and other products like Tab (Tab is more interesting than AI Pin, but we know very little about it). But the company delivered something that’s garnered almost universal praise and checks all of the basic boxes for a new accessible consumer gadget.

R1 is a gorgeous gadget. As soon as I saw it, I immediately recognized the Teenage Engineering touch of genius. It’s simultaneously fun and practical. It doesn’t look like a phone, but it’s still a handheld device. It should be familiar despite being entirely new. Anyone who has owned or seen a Panic Playdate will immediately think this is a distant cousin. The R1 has a touchscreen, a scroll wheel, and a rotating camera. You can use its unique AI and large action model features to get answers to questions, do research, scan and identify things in the real world, listen to music, and more. In a lot of ways it could replace your phone if you didn’t want to deal with the app model anymore. But Rabbit knows phones are essential, so this is a complement to your phone. It won’t replace it just yet (or maybe ever). It exists because of the limitations that the phone platforms have for developers. Rabbit is free to just make whatever software they want by making their own hardware. It’s potentially a forward thinking vision for handheld gadgets.

But best of all, it’s just $199 and doesn’t require a subscription. That’s extremely affordable as far as AI hardware goes. It’s in iPod territory. It costs less than a third of what the Humane AI Pin does and exactly a third of the $600 Tab. $199 says this is a new type of device that we want you to try. You don’t have to use it all the time and you don’t need to replace your phone with it. There’s far less pressure and risk. Plus, the subscription-free nature of the product means it just works. There’s no paywall just to use the thing and when you want cellular connectivity, you can just pop a SIM card into it.

So here’s a summary: a beautiful and unique device that costs $199, works with any cellular connectivity you want, features a well-designed brand new AI operating system, and is offered by a company self-aware enough to realize its place in the current landscape. I’m pretty excited to see where this goes.