OSSIC, the headphone company known for its massively successful 3D headphone crowdfunding campaigns, is shutting down due to lack of capital. The company says in an update announcing its closure that the OSSIC X 3D headphones required “significantly more capital to ramp to full mass production,” which effectively leaves tens of thousands of pre-orders unfulfilled.

OSSIC received over $2.7 million through its successful Kickstarter campaign, and $3.2 million through Indiegogo. The company is said to have raised seed investment from other sources, which accounted for about half of its total funding.

“We were not able to secure additional funding, and are out of money,” OSSIC says. “It would take more than 2 million additional dollars to complete mass production of the remaining backlog.”

At time of its closure, the company completed a mere 250 units, delivering a fraction of those to the 80 Kickstarter backers who pledged $1,000 for the Innovator Edition reward. Over 23,000 pre-orders were placed via Kickstarter and Indiegogo.

Image courtesy OSSIC

OSSIC X was touted for integrating specialized components including various inertial-measurement units (IMUs) and 32-core processor which allowed users to hear and interact with audio in a 360-degree environment, including different heights and depths. In the realm of VR, the headset was said to provide “accurate 3D sound” that could “direct your attention to elements outside your field of view for a more immersive experience.”

“Initial investment traction was strong,” the company explains, “but the slower than expected adoption of VR and the failure of several high-profile crowdfunded hardware companies made it challenging for us to raise subsequent financing.”

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As a new class of device targeting audiophiles and VR users alike, the OSSIC X was decidedly an ambitious undertaking. Headphones don’t typically require any special software to run, and OSSIC was tasked with bringing support for their 3D headphones to a variety of operating systems and devices.

“What made this project so exciting, and ultimately ended up being its Achilles heel, was the complexity and scope.”

Here’s OSSIC’s full statement to backers below:

Hello Backers,

It is with an extremely heavy heart that we must inform you that OSSIC is shutting down and will be unable to deliver the remaining OSSIC X headphones.

The OSSIC X was an ambitious and expensive product to develop. With funds from the crowdfunding campaign, along with angel investment, we were able to develop the product and ship the initial units. However, the product still requires significantly more capital to ramp to full mass production, and the company is out of money.

Over the last 18 months, we have explored a myriad of financing options, but given VR’s slow start and a number of high profile hardware startup failures, we have been unable to secure the investment required to proceed.

This was obviously not our desired outcome. The team worked exceptionally hard and created a production-ready product that is a technological and performance breakthrough. To fail at the 5 yard-line is a tragedy. We are extremely sorry that we cannot deliver your product and want you to know that the team has done everything possible including investing our own savings and working without salary to exhaust all possibilities.

The OSSIC X was started as a campaign to create immersive and interactive audio. One of the biggest questions was, in a world of small earbuds and phone speakers, do people really care about good audio? Are they truly interested in the next generation of 3D audio? The success of the campaign was a resounding “YES” that has had a ripple in the audio industry.

We will forever be grateful to you and the team members, investors, and business partners who believed in us and helped give our dream a fighting chance. We were able to achieve some amazing things in an industry that was, and still is, ripe for innovation. Your voice of support throughout these past 2 years will continue to bring change to the industry, as bigger players than us refocus their efforts into better, smarter, and more immersive audio.

Thank you for all of your support, and we sincerely apologize that we could not deliver all of the headphones.

– OSSIC Team

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Scott Hayden
Well before the first modern XR products hit the market, Scott recognized the potential of the technology and set out to understand and document its growth. He has been professionally reporting on the space for nearly a decade as Editor at Road to VR, authoring more than 4,000 articles on the topic. Scott brings that seasoned insight to his reporting from major industry events across the globe.

  • Seriously sounds like a scam anyways. The product description is nothing more special than surround sound headphones.

    • jj

      exactly

    • daveinpublic

      True. A separate system to track your motion outside of the headset itself? Definitely seems like a scam. And of course, they throw money into some cool marketing to have something fun to show the investors, keep the process going as long as possible, do minimal work, and take in a six figure salary throughout. When you run out of money, draft a super sweet apology letter that’s open and honest, and people forgive you, and even feel bad for you.

      Groupon did something that reminded me of this. The CEO made the company seem like it was worth more than it was, by giving falsified information to prospective buyers, drove the cost up to like 6 billion, got found out of course, and then drafted an apology letter to everyone involved and peaced out, having taken in an exorbitant salary though the whole process.

    • MikeTheInfidel more

  • Luke

    Samsung give us Entrim 4D headphones please!

  • MarquisDeSang

    3d sound and 3d sound raytracing has been and is done 100% in software, no need for special hardware. People backing these project have no basic knowledge or understanding of current technologies.

    • gothicvillas

      Technically, one can achieve real 3D sound with multiple speakers. Anything done with a single speaker is a 3D sound imitation.

      • Repsol900rr

        You both fail to understand what this was. The human ear perceives sound in more than just stereo. And room speakers aren’t attached to your head and don’t track with your movement. Multi spacial audio attached to your head and tracking your movements would be more like attaching your surround sound to your head.

          • Abalone

            I am confused. The advantage of the Ossic headphones was the IMU to detect head movement, so that the head phones could accurately recreate 3D audio. Can’t you do that with VR headset tracking and good software?

          • Adrian Meredith

            no because it had 8 drivers inside of the headset so it used the imu to actually direct the sound from the correct direction (so sound from behind you would actually come from behind you)

          • chuan_l

            It was snake oil from the get go —
            The shape of the pinnae and inter aural time difference and frequency ( ITD / ITF ) is what your brain uses to localise sounds in 3d space. So doing this ” inside ” the ear in a generalised manner is pointless.

            Furthermore the brain adapts to the shape of our own ears and there was never any hardware in those headphones to ” measure ” the pinnae or acount for the difference there.

            Both the company and headphones simply didn’t do what they promised ! If its really about the funding , then why not open source the design so that backers can make their own.

          • mrWhitenoise

            why not opensource it ?? for some tinkerers ?

            why not go for vacation for a couple of weeks until everybody forgot about this,
            then sell the company for another bunch of millions,
            since it allready has a developed product that people want to have, ready for mass production.

          • Raphael

            Where is the feedback from the 80 or less who received their units? Seems odd no one actually posted a review.

          • chuan_l

            It was snake oil from the get go —
            The shape of the pinnae and inter aural time difference and frequency ( ITD / ITF ) is what your brain uses to localise sounds in 3d space. So doing this ” inside ” the ear in a generalised manner is pointless.

            Furthermore the brain adapts to the shape of our own ears and there was never any hardware in those headphones to ” measure ” the pinnae or acount for the difference there.

            Both the company and headphones simply didn’t do what they promised ! If its really about the funding , then why not open source the design so that backers can make their own.

    • Julian Jarecki

      Lol, that’s like saying something like “Physical properties like soft or bouncy material has been and is done in Game engines, no need for speical hardware. people backing gloves have no basic knowledge or understanding of curent technologies”

  • Brad

    Yeah, I never got how these were any different that regular headphones. Glad I didn’t back these. I would be mad as hell. Just goes to show, be careful what you support on KS and IndyGoGo; it’s always a bit of a gamble.

    • Christina Ocasio

      Let me as you a question. When you are wearing you headphones, do you ever turn around? I am talking about turning around to look at something behind you. Did the sound change? Because it should have, the sounds going in each ear should have switched. Imagine standing in a room that has someone saying that word “One” standing immediately to your right. Then after a 1 second pause, You hear the weird “two” spoke by the person standing immediately to your left. This pattern repeats. Then you turn around. Now the word “one” is on your left and “two” is on your right. This is the real world. Now record this in stereo and listen to it on headphones. “one” will always be on the right and “two” will always be on the left no matter how you move. You would also be able to tell if the voices were coming from different heights.

      These headphones were supposed to be able to recreate the actual live version.

      • Brad

        I see. When it comes to regular recordings, no, my headphones do do that. But when it comes to games (and these were marketed mostly to gamers, VR gamers in particular), yes any old headphones do that. So it would be kinda neat to hear music on a virtual sound stage, but when it comes to games, it’s redundant.

      • Mr. New Vegas

        Isn’t it pointless for VR? Since VR has all the sensors already and its also attached to your head, there is no need for another set of senors inside the headphones, only connecting the headphones to VR (directly) should solve all issue and make it run in sync.,

        • MasterElwood

          Exactly. Selling this for VR-use was just a scam.

      • chuan_l

        Its still not going to be correct —
        Because localisation of sound depends on the unique and personalised shape of the pinnae , along with brain adaptation. So you really need to get the exact ” binaural fit ” for each person. They spoke about Ossic being able to self-calibrate but it was all bullshit.

        Simply rotating the sound field seems a pretty dumb. I thought they were doing more than this ? Putting extra drivers in the headset is a dumb idea too : its not like the sound doesn’t bounce around before it gets funnelled into the inner ear.

  • alboy2

    And they’re going to give all the money back, right? Right??

    • Raphael

      Haha! You’re a funny guy!

    • Ackermann

      nope, lost 289$ there.. They prefered to waste the money on marketing, instead of developing their product. I mean just 6Million $ (and more from other investors) who cares, right? Some of the people try to do a class action lawsuit now, but chances aren’t high that we get anything out of it.. :/

      • Andrew Jakobs

        Ofcourse you’re not gonna get any money back, that’s the problem with Kickstarter, some people think they are buying an actual product, which it isn’t, you invest money and if all goes well you’ll get a product as a reward..

    • NooYawker

      Yes as soon as they sell their mansions and ferrari’s they bought with the money.

    • Jistuce

      You don’t understand how Kickstarter works. You give them your money to fund development. It is not a store.

      Even if it was a store, where would the refunds come from? They’re shutting down because they ran out of money.

      • Laurence Nairne

        I think he was being sarcastic.

        • Jistuce

          Sarcastic about the money coming back, or about the idea that refunds ought to be issued?
          Usually when kickstarter is concerned people are mad that refunds aren’t being issued, or just ranting about people “taking off with the money”. So I read it in the usual “This is a store, and they STOLE OUR MONEY” tone.

          • Laurence Nairne

            Sarcastic about the money coming back, though it could be both, i.e. caricaturing the clueless expectant of a refund.

          • You’re also speaking as an outside looking in and not someone that actually lost their money. Therefore your great “sense of reasoning” is falling on deaf ears because they know you don’t really give a damn one way or the other.

          • Jistuce

            True story: I’ve had one Kickstarter actually die so far(as opposed to major delays). It was an ACTUAL scam, a “cut all communication the instant the funds clear” deal.

            And after I noticed their “company” was named after the evil organization in a TV show, I couldn’t stay mad. I got my money’s worth out of the ensuing laughter. But then, I only had ten bucks on the line.

            I just get sick of seeing “we did our best, and it wasn’t good enough” portrayed as a scam. There’s ACTUAL scammers out there to crucify.

  • Shame they didn’t make it, surround sound is just that sound, around you at a fixed spherical distance, these guys were trying to make positional audio at any point in space like somebody whispering BOO behind your ear (which surround sound / movies can not do) using headphones which from all intents seems they managed it. To fail at the mass production point is just bad planning. Wonder who will buy the IP.

    • Guygasm

      They failed because both Oculus’ and SteamVR’s positional audio solutions already do exactly the same thing using standard headphones. Why would someone invest in this when the solution already exists?

      • Adrian Meredith

        except for they don’t, the sound in most vr games is shiiite. I regularly found games difficult because the sound didn’t even remotely line up with the visuals which is really obvious in VR

        • Guygasm

          That’s dev implementation not the SDK/engine’s audio solution. If devs aren’t doing that correctly, they wouldn’t implement Ossic’s correctly either.

      • Traditional headphones do not measure the wearers ear distance, nor do they have 4 speakers (drivers) per ear. Nor do they take head shape into account in their audio algorithms because they have no physical data to do that. Ossic was meant to solve these additional problems through hardware and bespoke software that went beyond software only positional audio.

        • Guygasm

          They failed because they couldn’t get more investment funding. If their solution was significantly better than Oculus’ or Valve’s (also accounting for the extra cost of Ossic) this wouldn’t be the case. Current VR positional audio lets you localize sound very well (when implemented correctly). It’s not hard to see that there is a limited market for $400 headphones that only marginally improve positional audio over the integrated solution.

          • Positional audio from VR SDK’s is not the same thing as what Ossic were attempting. Things like automated HRTF’s, that and traditional headsets do not have multiple drivers per ear for much more accurate positional audio which you can not do with just a software solution. Ossic’s headset had 8 drivers. Not 2 like 99% of headsets. It also had head tracking and software built into the headset for non VR use.

            It was simply a more advanced product of what you can get right now. No doubt you will eventually see a pair of headphones or more likely a HMD that does all this in the future.

            At least a bit glad to see you changed your mind why they failed ;)

  • Rob

    Sorry to see that it didn’t happen for them, and I feel bad for the thousands of backers that lost their money. I was able to try a prototype of these at the Game Developers Conference in 2017 and they sounded great, I only didn’t back it because the price seemed a little high for something that was not fully implemented.

  • NooYawker

    Stop backing tech kickstarter campaigns. Companies invest 100’s of millions of dollars into developing new tech. A few assholes on kickstarter isn’t going to make it happen with a fraction of that. 99% of tech campaigns are bullshit.

    • Celestias

      All of the tech Kickstarter stuff I backed got delivered successfully. You just need a brain to do your due dilligence.

    • Caven

      If people had taken that advice years ago, VR might not be where it is now.

      • NooYawker

        It would. Because Valve was working on VR as well. Carmack was working on VR himself before he decided to legitimize oculu.

        • Caven

          I’m not convinced of that. While Valve was indeed working on VR, Valve is not known for doing anything quickly. I suspect that if it hadn’t been for the Oculus Rift dev kits demonstrating a real interest in VR, Valve would have been content to continue doing internal R&D for however long they saw fit. Certainly they’ve been in no rush to get the knuckles controllers out the door. It’s been almost a year since prototypes have been sent out to developers, and there’s still no word of a possible release window. Valve has been so silent on the matter that even HTC had to settle for a modest upgrade on their existing controller design rather than work with Valve to include the knuckles controllers with the Vive Pro. And even if they wanted to release a product to the masses, they probably would have had a harder time finding another company to partner with. Even now, they seem to be having trouble getting anyone to use the VR lenses they developed. I also imagine they would have wanted to put out a game to showcase VR. If anything, it feels like the Rift forced Valve to tip their hand early.

          As for John Carmack, I’d say his interest in mobile VR is actually counter-productive. 3DOF headsets and controllers really aren’t versatile enough to properly illustrate the potential of VR. Or to put it another way, imagine if the current VR movement only consisted of Google Daydream and Oculus Go.

          Maybe it all would have worked out anyway, but it by no means would have been a sure thing.

    • mrWhitenoise

      oculus itself was a kickstarter campaign …

      • WyrdestGeek

        It sure was. And boy were some backers ticked off when it got bought by Facebook.

        Being a crowd funding backer gives you all of the risk of being like a VC or something, but with absolutely no say in what the fledgling “company” ultimately decides to do.

  • WyrdestGeek

    I came here to schadenfreude, but instead I feel bad (slightly).

    It is too bad they didn’t or couldn’t make it work. VR is definitely going to need to get better audio.

    Crowdfunded ideas seem to go belly up frequently.

    • daveinpublic

      I wouldn’t feel too bad. Despite their claims that some of the workers worked for free for 6 months, I’m sure the top brass was taking in a hefty salary throughout the whole process, to make it worth their time and risk, at the customers expense, or course… So, now, they get to have had months off from work to achieve their dream, have nothing to show for it, and be fully funded as they take their next long vacation.

      • chuan_l

        Despite what they published —
        Nobody ” worked for free ” , they just landed jobs at other companies. Somebody might want to check out Linked In sometime ?

  • sfmike

    This is the first Kickstarter fail for me and I guess now I’ve learned my lesson. I think they burned through their money on glossy ads and trips to trade shows as well as nice cushy salaries for those on top.

    • Michael Slesinski

      welcome to the club (though i got my first fucking YEARS ago). i think its when they post about those trade shows that the nut punch is the hardest. here you are trying to help them get off the ground and there they are blowing $20,000 (atleast) on a weekend that involves a bunch of nerds verbally wanking eachothers dicks.

    • Andrew Jakobs

      I also do think it’s pretty much spend on the latter, and the trips, and hardly actually in the real product itself. They hadn’t had a clue how to run a business and just hoped people would give them money so they could finance their hobby. I’ll bet all of them have a nice bankaccount by now.

  • Timotheus

    I think most people posting, that what OSSIC X did, could be done in software or is already done by other headphones or whatever, have no real clue how OSSIC X is/was working or are talking sh….

    1. The head dimensions from ear to ear are measured by sensors, calculating your own personal HRTF. This is extremely important as for example ear to ear distance, plays one of the biggest roles in determining sound location -> Of course using pregenerated HRTFs and running them in software is possible, but most of the time, you won’t find a perfect HRTF or have to listen through a dozen of them to find a nice one. Without a correct HRTF you can’t really convert sound to real “binaural” surround, that sounds like live, but you have problems locating sound sources, e.g. above/below, front/behind.
    And even if you would find a perfect software generated HRTF or would use expensive equipment to generate a personalized one, most software (games, music players, video players etc.) don’t use HRTFs directly. The only way I found, was for example in Minecraft and other OpenGL games with a specific method.
    So you with OSSIC X, you have no work finding an HRTF, and the OSSIC X is using it, by converting Stereo, 5.1, 7.1, Atmos etc. to binaural or with their SDK, would have had unlimited sound sources.

    2. The OSSIC X included IMUs to do headtracking. Of course if using VR, the headset is capable of headtracking itself and converting the sound in software is possable with normal stereo headphones. But OSSIC X provided the possibility to use this headtracking without VR, for example to virtualize music or other non-VR sound sources. So you can rotate your head and the sound changes. Which is not possible with any other headphones, without VR. Even smartphones were supported.

    3. The OSSIC X, was specifically designed to be as realistically precise as possible to simulate real sound. So the ears are covered by an anechoic chamber, that had multiple drivers. Many people talking the OSSIC down, said that multiple drivers are always shitty and one good driver would be better. But if you want to direct sound onto the ear/auricle/pinna precisely, one driver directly pointing to the ear canal isn’t ideal, because the form of the ear plays a huge role in determining where a sound comes from. Therefore one driver could bring sound from above, one from below, one from the front and one from the left. And they could be mixed to simulate every sound inbetween.

    I hope this clears this up.
    Audeze is now trying to do the same with their Mobius headphones. They also have headtracking and they mention anatomy calibration. However it seems they only use 1 driver and I think their ear chamber desing isn’t anechoic.
    Some aspects seem better, than OSSIC X, like wireless possibility.
    Unfortunately atm I don’t have money left and the Indigogo campaign is already over, leading me to a price 100$ of what I have backed for the OSSIC X.

    Greetings from a sad backer of the OSSIC X

    • WyrdestGeek

      Tl; dr but– you might be right, but– that just makes the ossic collapse that much more sad.

  • Mr. New Vegas

    LOL

  • Kenji Fujimori

    CrapStarter China Scam

  • DiGiCT Ltd

    If you can’t make a headphone with that kinda investment money you just scammed a lot of people or just don’t know how to manage it.
    stuff is not expensive to make, the expensive part comes at the end when you make the consumers price.

  • Julian Jarecki

    I’m really sad. It seems They really didn’t do an efficient job with all the time and money they had.

    Farewell my dear money, I guess I wont see you erver again in any Form.

    Also goodbye to my naive trust in flashy professional looking kickstarter campains of companies that haven’t actually produced and sold anything before.

  • HybridEnergy

    Seperate head phones for VR are annoying, like I need another step to get VR going. The Audio Strap was a god send on the OG Vive, and I’m not taking off the PRO’s headphones.

  • N30rebel

    Here I’m just now finding out what happened. I guess I didn’t need 3D headphones to hear my sphincter slam shut.