The Phantom Zone

than that. They call it the an example of an entire scam or hoax, And I'll let you guys decide for yourselves, but I'll say this, there's a lot of at least evidence that seems to support that not everything was on the up and up. But draw your own conclusions. So, uh, the prototype, when it did happen, it was kind of

cobbled together from standard computer parts. So what was the Phantom, Well, it is meant to be a next generation gaming rig that would bring PC gaming to the living room back in two thousand three, two thousand four, and it proposed something fairly revolutionary in the process. Now, today, if you were to unveil a gaming device that required you to download all the titles to a hard drive, you probably

wouldn't raise that many eyebrows. It's not uncommon for a gaming PC to lack an optical drive, after all, most gaming rigs I've seen these days don't have an optical drive. And digital delivery of games has been growing in popularity. I mean, just take a look at steams numbers, They're incredible. There's still a market for physical copies of a game, however, particularly since you can potentially sell or trade in old

games if you use physical media. But overall, I'd say the trend has been to move toward more of a digital download experience. So if I said I was going to launch a brand new console that could only stream or download games, I probably wouldn't leave very many people scratching their heads today. But the same was not true back in January two thousand three. That's the year a new company that was called Infinium Labs announced it was

bringing a gaming console called the Phantom to market. Now, this was months before Steam would launch, let alone become the dominant online market for computer games. In two thousand three, it was pretty much common practice to go to game stores or big box outlets to purchase computer titles. So when Infinium Labs brazenly announced the company intended to turn the home gaming market on its head. They got a lot of attention. Now, ultimately the story would be followed

by controversy, anger, and finally mockery. And it includes allegations of fraud or at the very least ineptitude. It involves the company that changed its name and switched tracks to create a totally different product than the one that was promising to consumers. So we're really going to dive into the story of the Phantom and what actually happened. Now, our story begins. You guys know me, I like to always dive further back than when the actual stuff happens.

Our story really begins almost a decade before any mention of the Phantom ever hits the public. In the early nineteen nineties in St. Louis, Missouri, They're a man named Timothy Munroe Roberts was working at a computer store and he had a customer named Andrew Gladney, and the two of them began to talk about an idea for a business. This was not the business that would become in Phinium Labs, however. It was instead to create a data hosting service and

an early internet data hosting company. They called it the Savaths Communications Corporation s A v v I. S now Gladwell put up the majority of the starting capital. He had a pretty healthy trust fund to draw from. It was left to him by his grandfather, who has a founder of a company that made a little soft drink called seven Up. Together they got the business up and running, and the company saw some early success with Robert's landing

a big deal with Apple Computer Incorporated. And landing Apple meant Sabbaths had some serious market buzz behind it, and they soon secured several other big contracts. Roberts, however, had decided that he wanted to try and do something else, so he left Sabbaths in n and went out to start a new business. Now. This time, this was a web hosting company called in tira I n t I

r A, also based out of St. Louis, Missouri. Some of the concepts the company pushed were predictive of the cloud computing craze that would follow a few years later, but perhaps it was a touch too early for the company, and coupled with the dot com bubble bursting in the early two thousand's, it ended up not surviving, it filed

for bankruptcy protection in two thousand one. Oddly enough, Roberts had already extricated himself from the company at that point, selling off most of his stock, which in hindsight might seem like it was a bit of a tip off.

Roberts had left in Tira around nt SO a couple of years before the company went under, and he went on to found another company, this time called Broadband Infrastructure Group Corporation, also known as Big b a G. The company's mission was to act as a sort of incubator for tech companies and developed communications businesses, according to the St. Louis Business Journals, So this is still happening in St. Louis,

Missouri now. According to the St. Louis Post Dispatch, Big raised about eighteen million dollars from investors in two thousand and it even sponsored a race car during the Indianapolis five hundred that year. There are also stories of lavish parties, expensive wines. In fact, part of the bankruptcy proceedings, because spoiler alert, Big went out of business to part of the bankruptcy proceeding has included the auction of twenty four models of Chateau Lafitte Rothschild, which was a worth about

twenty four thousand dollars. Within nine months of raising those millions of dollars, b I G closed. Now that led to Roberts getting some heat in St. Louis See. I changed it to Sant Louis for this part, and soon he had folks at the state and federal and city levels all asking some really tough questions about his entrepreneurial efforts, and undaunted, he picked up stakes and he moved to Florida,

near Tampa. He started a new company called Infinium Labs, and on January twenty, two thousand three, he started the company two thousand two, by the way, but in two thousand three, on January twenty, company issued a press release about their plans. It's a short one, so I'm going to actually read the press release. A Tampa Bay area technology company in Phinium Labs Corporation, will develop and market a new game console that will outperform the Xbox Sony

PlayStation two GameCube. The company plans to market a high performance gaming console and delivery system to provide consumers with options and capabilities that are not available in today's marketplace. The console will appeal to the hardcore gamer and the high end consumer electronic purchaser. The next generation game console provides a robust, fault tolerant delivery system that supports games on demand, game rentals, game demos, seamless upgrades, and patch management.

The game console is an always on broadband device. It is easy enough for children to use independently, yet so advanced it exceeds the needs of hardcore gamers. In Phinium Labs was formed by veteran entrepreneurs who have a successful track record in building large scale companies and advanced architectures

for supporting massive e commerce and enterprise applications. Combining skills from telco data communications, digital rights management, software development, and security, the management team brings together a unique array of skills to develop the most robust next ration gaming console and delivery network on the market. The Infinium Labs game console features a high tech design and offers ease of use

for the variety of game players worldwide. The on demand delivery system will appeal to hardcore gamers as well as casual users. The unique design architecture allows for delivery of a large number of games and the ability to participate

in online massive multiplayer gaming. Key features include fastest console on the market, broadest selection of preloaded games, cross platform capabilities, state of the art design and architecture, advanced accessories and wireless capabilities, online connectivity for multiplayer gaming, seamless upgrades and

patch management. A multi tiered subscription service that meets the needs of casual, moderate and hardcore game players, demo games before purchasing or subscribing, games on demand, and game rentals. The advanced system provides game developers and publishers a secure and efficient software distribution system. In Phinium Labs intends for game developers and publishers to reap greater profits using this

new game delivery system. And Phendium Labs has engineered its prototypes and it expects to unveil the new gaming console in March of two thousand three. The company intends to launch the game console to the US consumer market by November two thousand three. Remember that date. And Phenium Labs has chosen Florida as its corporate headquarters. Florida has emerged as a leader in support of technology companies with its e Florida initiative. Offices will soon will open soon in

Silicon Valley and St. Louis, Missouri. About in Phenium Labs and Phenium Labs Corporation was formed in October two thousand two as a global entertainment gaming company and Phenium Labs mission is to market a gaming console and delivery system that will be the performance leader in the game playing entertainment industry. The company will market a robust game console that will appeal to a wide audience with its ease

of use, quality assurance, and robust delivery systems. Now, we could probably say today that those promises we're a little astounding for their time time and perhaps even a bit boastful. I mean, you're talking about the fastest game console on the market. Back in two thousand three, this was a new company, untested in this space, setting out to challenge

entrenched companies like Sony and Nintendo. And then you had Microsoft, which was relatively new to the video game console market at this point but had already established itself as a powerful presence in the industry. And the features the press release listed were extremely innovative at the time. I'm sure the gamers out there recognize that many of those features

are now standard on several consoles. For example, both on the Xbox One and on the PS four you can sample some games and even get some titles as part of a monthly subscription service. So that kind of stuff today isn't innovative, but at the time it was a totally different way of doing business. So the promises being made, while advanced, we're all features that would later on become

standard in video game consoles. It's just that in two thousand three, this was a really wild idea, and it raised questions was the world ready for an always on internet connected console? Now? Judging by the resistance gamers put up when Microsoft first said the Xbox One was going to follow that same model and being always on broadcast service, I think it's safe to say that if pack in two thousand three, the world was not ready at that point, because it wasn't ready when the Xbox One came out.

More importantly, was the technology ready or did the company make promises that would have been impossible to deliver upon even if it had been established as a big player in the space up at that point. In other words, if this had been Sony or Microsoft, would they have

been able to pull it off? Or was this just a promise that no one at the time could deliver upon we'll take a look at more details about the unveiling of the Phantom and what happened in the wake of that, but first let's take a quick break to

thank our sponsor. Now, before I get into all the controversy that surrounds the Phantom, I thought it would be a good idea to talk about what it was supposed to have inside of it, what kind of connectors it was supposed to have, you know, how it was going to connect to your television, and talk a little bit more about the subscription service and the online element to this, to kind of get an idea of what exactly was supposed to come out. Now, keep in mind that not

all of this ever materialized. Also, this is dependent upon technology of the early two thousand's, even the TV technology at the time. So there's some things that you would have considered would have needed to be standard that we're not included, like h d m I is not a component on the Phantom spec list, and that's largely because back in two thousand three not such a big thing. But other things that you don't see as much anymore, like composite or component video that definitely was part of it.

So for the standard components of the Phantom, because you could also get optional components added on, or at least in three you could. In reality you couldn't get anything. The standard components were supposed to include a custom operating system on a Windows XPE kernel, so that custom operating system was to make it proprietary, kind of like the operating systems you would encounter on other video game consoles, and it would end up locking you into the Phantom's ecosystem.

It was supposed to have an a m d Athalon XP plus central processing unit which would have approximately one point eight giga hurts of CPU power, and it was supposed to have an Nvidia g Force f x fred Ultra graphics processing unit. Was also supposed to have an Nvidia enforced to Ultra four hundred motherboard, two hundred fifty

six megabytes main memory, forty gigabyte hard drive. Don't be digital five point one surround sound onboard, radio frequency wireless modules that would allow you to connect things like UM wireless mouse or wireless controllers or wireless keyboards to this and S video r c A or component video connections also composite, as it would turn out uh a Ethernet port so that you could actually plug that into your

Internet connection. That was supposed to always be connected to the Internet, so you need to have something a wireless controller, a wireless keyboard and mouse, to USB ports, and four

controller ports. Then there were some optional components you could add on to that, which would include extra controllers, either wireless or accorded ones, a keyboard and mouse with charging, base station storage expansion for additional game storage so you could double the amount of storage space on there in theory, a DSL modem, a cable modem, a wireless WiFi card,

memory upgrades, speaker set, and flat screen displays. So in other words, you could go from something that you were supposed to just hook up to your TV to something that would have potentially multiple screens, although as far as I can tell, they the graphics card wasn't necessarily set up to support multiple displays, but that doesn't mean that

it couldn't happen. One thing the Phantom did not have was any sort of portable storage drive, so there were no CD drives, no DVD drives, no cartridges, no floppy disks, nothing like that was ever supposed to go into the Phantom. All material was meant to be downloaded or streamed directly to the console. Now you may hear some of those specs and say, well, that just sounds like it's a PC, and really, when you get down to it, that's what

the phantom was. But then, to be fair, all video game consoles ultimately end up becoming variations on the concept of a personal computer. The big differences you've got some changes in architecture. Something like the PlayStation four has an architecture that's different than most PCs. Uh And with a console, you typically are stuck with the hardware that the system came with when it first launched or whenever you bought it. So if I go out and buy an Xbox One today,

it's hard for me to upgrade that. I can probably upgrade the storage by adding external storage, but I'm not going to be able to upgrade the processor or graphics cards or anything like that. With a PC, you can actually upgrade components, at least until you bump up against limitations like you've got stuff that's going to be too big for the size of case that you have, or the motherboard will no longer support it, something along those lines,

And technically you could keep on swapping out components. You're essentially building a new computer at that point rather than just upgrading. But it is a possibility, but consoles are different. You pretty much have to wait for the next generation

to buy up and and increase your console's capabilities. The Phantom was meant to play PC games, so that was one concern a lot of people had early on was if this in fact was to be a standalone video gaming console for the living room that would allow you to play PC games in the living room, something that a lot of people have been trying to do, and in fact today are still trying to do, like steam

boxes are essentially that same kind of approach. Uh. Even though you know that was the mission statement, everyone was pointing out, well, what happens when the games get too advanced to run on the hardware of the Phantom. You would have to upgrade somehow, and you could do some upgrades through firmware, but that's not going to make the process or work any faster necessarily, or make the graphics

card work harder. So that was a big concern was that if in fact, this is essentially a customized personal computer running some proprietary software on top of it then what happens when the games get too advanced? Now, as it turns out, there was never a need to answer that question, but it was one of the early ones. And as I mentioned earlier in this episode, the console or hit the market, so some people would refer to it as vapor ware, but all the components existed. The

stuff that they talked about really did exist. I mean, all of those different elements you could go out there and buy, so there was never a problem with that. There's just there was no consumer product that featured all

of those in that configuration as a phantom console. There are a couple of prototypes or show models that Infinium Labs would trot out at various events like c E S or E three, and there's some debate in online circles as to whether those prototypes represented a real effort to create a phantom console or if they were in fact just a run of the mill PC inside a

customized case. In some cases, it wasn't even that. According to one story I was reading, a games journalist went to E three and saw a demonstration of the phantom console and it sat down next to uh representative from Infinium Labs who was going to give a demo of the whole thing, and they had the console sitting in

front of them. They tried to launch a game and it didn't work out properly, And as it turned out, the representative actually revealed to the games journalist that the game itself was being run on a PC behind the cabinet, that the console that was on display was in fact a dummy console. It didn't do anything. It just had some lit up letters that spelled out Phantom, but there

was nothing going on inside of it. Now that's not to say that every single instance was a fake console with a real PC behind the curtain, Wizard of Oz style, but at least according to that one report, that was the case. Now, as it turns out, years after the Phantom controversy had kind of fizzled out, Ours Technica would run a piece about a reader named Eddie Schlessinger who

worked at a computer repair shop in Venice, Florida. Now remember, Infinium Labs was originally located off Florida and around to the and twelve. A customer brought in this weird PC console. It was branded a Phantom, So apparently this customer had bought the set from someone else who had no idea what the heck this thing was. For the princely sum of two hundred dollars. Now, considering that it may be one of a kind, or at least maybe one of

a dozen or so, that's not bad. Schlessenger had a chance to crack it open and look under the hood and see what was there. Now, Remember Schlessenger was telling Ours Technica about this a few years later, I think it was so about three years had passed so, according to Schlessenger. Inside the prototype was a motherboard supposedly made by a sus That's what Schlessenger thought, had the Nvidia fx F a g P video card that had been announced.

It had some d DR ram um. Some of the ports on the back we're working, and others were just for show. It had video outputs for composite component and S video connector, which again these days we would probably just use hd M I instead. It also had audio output jacks for optical co acts or our c A connectors, and there were four USB ports. The system was not in working order, so he ended up making some modifications to it, and he even installed a phantom promo video.

He took a video that had been circulated on the internet for a while, and he used that as sort of the load up screen for the console, so that the customer could say that he owned a working Phantom console. Now, it sounds like a lot of the stuff and Phinium was claiming the Phantom would include found its way into that prototype, which is something. At least not all those

ports were working. But then if the company wanted to create a proof of concept to kind of show how the system would work, it might only focus on the necessary components to get it to perform as needed for a demo. So, in other words, if you're shopping it around trying to get some investors to give you money, you might have a mock up where it's not a fully functional unit, but you want to show off the concept so that you can get the funding to complete it.

That doesn't necessarily mean that the company is shady or suspicious in any way. Presumably the finished product would have included all of the working components that were being talked about in their press releases. Now that would also mean customers would get a keyboard and mouse in what Infinium Labs was calling a lap pad, And this was an attempt to make it easier to play PC style games

on a home television in your living room. Many PC games are compatible with game controllers, but some games, like first person shooters or real time strategy games tend to work best using a mouse and keyboard approach. If you use a controller and you go up against someone else who's using mouse and keyboard, you will probably find your petuity handed to you. So what about the online service

part of this whole package? Will Athenium Labs plan to operate a Virtual Private Games Network or vpg in And this is a special type of virtual private network or VPN. And you may have used VPNs for work or for your own computers. For those of you who are unfamiliar with the idea, let me give you a real quick, high level rundown. So a VPN creates a private network across a public network. So take the Internet for example. That's a public network anyone can hop on or off

at any time. Private networks require access to machines on the network itself, so like a physical private network is completely separate from any other network, or it only has very controlled portals to other networks. And the only way you can get on that physical network is if you

have access to a machine that's connected to it. Um A VPN simulates that it's not a true private network, but through code, creates a situation that is essentially like that, and it can send that communication across a larger public network. This means communication across the ep N is encrypted to protect data from snoopers. Otherwise you might as well just use a public network in the first place. It's typically used by businesses to allow remote employees access to company

intranet systems. Other folks might use a VPN to communicate securely with other people or to access services that might otherwise be blocked in their real physical location. So you might log into a VPN and use that in order to access something that otherwise you would not be able to touch from wherever you are. It's really handy if you happen to be in a country that has a, you know, a more nanny state kind of approach to guiding how the Internet should be used by the population.

So why would Infinium Labs want to operate a vpg N. Well, mostly it's to lock a customer into an ecosystem. And here's how the business plan would have worked if it had ever launched, you decide you're gonna go out and buy a Phantom console. Actually, you can have a couple of different options. You could purchase one for ad dollars at least that was one of the amounts quoted, which

is actually incredibly cheap. Or you could rent it. Or you could sign up for a two year subscription agreement with Infinium Labs on their Virtual Private Games Network, and if you subscribe for two years, you would get the hardware for free. So the subscription would cost twenty nine dollars a month, and for that you would be able to use the Phantom Network to download games, uh to

stream games, to play games online with other people. You would have access to a suite of games right away that would be included with your subscription fee, so you wouldn't have to pay any extra for a certain library of games. If you wanted games that were beyond that library and Infinium Labs had secured the rights, you would be able to download demo versions of those for free, and if you wanted to purchase it, you could do so through infinium labs as online store and down the

game directly to the console. The console would keep track of how much storage space was left, and it could even dynamically manage it. So if you start getting close to your limit, Remember you've got that forty gigabyte limit. Let's say you start getting close to that. These days, it wouldn't take long at all because games are so huge.

But let's talk about two thousand two four, you start getting close to that forty gigabyte limit, Well, the phantom would end up deleting older games that you had not played in a long time, but the service would keep track of which games you had purchased, so if you ever decided you wanted to go back and play an old title, then you could download it again for free because you had already purchased it previously, so there'd be a record of the fact that you had bought it before,

and you wouldn't have to buy it a second time. Now, in many ways, this is how subscription services like Xbox Gold memberships work today. The business plan sounded actually pretty solid.

It was very innovative for its time. There'd be incentive for gamers to subscribe month after month because they could get access to the games within the library, as well as a chance to buy other brand new games, possibly at a discount because you're not buying them the physical media, although now we know that doesn't always work out that way. You don't always get a discount just because you're not buying,

you know, a disk. It can be just as expensive or sometimes more expensive, to buy the digital version, which is infuriating for a lot of people. There were also hints that game titles could come out a little earlier, so you could get them much quicker than you would if you were to have to go to the store.

There was no danger of them selling out. You didn't have to worry about pre registering for a game and hoping that the the local game stop or whatever game store you would go to would have enough copies on

launch day. You could just download it. So there were definitely, you know, reasons that a gamer might be interested in this, Although the thought of having to pay an ongoing subscription service to keep using a video game console that you would already purchased rubbed a lot of people the wrong way. It was an idea that maybe wasn't quite ready yet.

So on the business side it sounded fantastic because you would have a company that would have an incoming, steady flow of revenue because it's not just selling a console once to a customer. It's selling a console and then offering a subscription service and then getting a monthly subscription fee from that customer, and then you put that across thousands of customers. That's an incredible revenue stream and it's obviously one that works for a lot of game developers

today and game consoles today. But at the time, again it was a pretty uh radical idea. Now, on top of that, using a proprietary approach for games distribution solved another problem the company would otherwise encounter. So this is another reason for that virtual Private Games network. The Phantom was, as I said, essentially a PC connected to a television, So without any sort of proprietary overlay, nothing would necessarily stop gamers from downloading games from other sources outside of

Infinium Labs. If you could just log into the Internet and maybe go into a Torrent site, if you had a bit Torrent installed on your Phantom, you could end up pirate in games if you wanted to. But by having that proprietary layer on top that was encoding games in a way that only Infinium Labs machines would run, then you didn't have to worry so much. You know, people couldn't just take their their phantom and make it do anything. They were limited in what they could do

with it. So it is a kind of a special purpose PC, uh, or at least you could reduce the number of people who are using it to pirate games. I mean, someone is always going to find a way to hack hardware and make it do something it wasn't intended to do, especially if it started off as a PC. That makes it easier and if you know what you're doing now. All of the US was met with some skepticism, though again I have to stress that we've seen these sort of things pan out in the long run with

stuff like Steam and various video game console markets. But at the time it seems so ambitious and so sudden and out of the blue that a lot of people were worried that this was too good to be true. And you know how the rest of that saying goes well. Athenium Labs had made some big promises, including a desire to get a product on the market in time for

the two thousand three holiday season. That time came and went, and the company had no consoles to show for it, but they said, don't worry, it's gonna come out in holiday season two thousand four. That time came and went

as well, and still no console. They did show it off a couple of times at different at different trade events, like I said, but at least in some cases it turned out that it wasn't really a console that people were seeing, just the concept of what the console would be, even before in Phenium Labs had slipped that two thousand four holiday dates. Some people were really suspicious of what was going on behind the scenes, which include some folks who wrote for hard O c P. That's an online

magazine that caters to PC owners. You can find tons of articles and reviews about all sorts of things over there, including a pretty tough investigation into Infinium Labs and Timothy Roberts in particular. All Right, so it's September two thousand three Wednesday, as it turns out, and an article goes up on hard O c P News titled behind the Infinium Phantom Console, and it takes a really hard look at Timothy Roberts's past as well as the claims made

by Infinium Labs. The article argued that Roberts had a history of starting companies that ultimately failed while raising millions of dollars in investment money in the process. So the article alleged that Infinium Labs, as of September two thousand three, had raised at least twenty five million dollars in venture

capital and had nothing to show for it. Now, I might be inferring too much here, but even the opening of this article, to me, it sounds like they're at least hinting that perhaps these business ventures weren't meant in sincerity. In other words, there might not have ever been an intent to actually have a working business there. Again, this

is my interpretation. The article does not say this outright. Instead, it just seems like there's a hint that maybe there's some sort of scam shady business stuff going on, And it sounds a lot like the main plot behind the Producers. Like, if you raise a lot of money for a business and that business ultimately fails, you never have any profits. You have to worry about paying out to shareholders. If the business didn't profit, then you have nothing to pay

So what what? Who cares if you just happen to have bought a few cases of incredibly expensive wine in the process, but this may be putting words into hard O CPS figurative mouth. At least in that first section, there are no outright accusations that Roberts was running any

sort of scam. But the article continues with a breakdown of what the phantom console is supposed to have, essentially running that same press release I read earlier, but pointed out that at least to that point, the only images that had been seen outside the company were three D renderings and not actual photographs of a working device. Later we would get photos and videos of a device that appeared to be working, but at this time there were

there were no such images available. Next, the article laid out the places that Roberts had worked over the previous eight years. He had held eight different CEO or director level positions in those eight years, according to his own website. They included two other companies, when Force LLC and med Hire LLC, that were operating operating concurrently within Phinium Labs. So, according to his website, he was a director on one Force LLC and med Hier LLC while simultaneously serving as

the CEO of Infinium. Now, the writers at hard O c P took time to contact med Hire LLLC to check in on Roberts's history. The article states that a woman who was identified as Laura Roberts picked up the phone and indicated that Laura Roberts different person, uh, and Timothy Roberts's mother was in fact the director of med Higher lll C, and that Timothy, while being her son, was not a director. Later this same Laura Roberts said, oh, no, no, no, Timothy Roberts is a co director, but I don't have

any contact information for him. I don't have a phone number or an email address or anything. And when they said, isn't it strange that you work for a company but you don't have any contact information for one of the supposed directors of this company, and her response was he changed his phones a lot, which also seems a little weird. They also tried contacting when Juan Force LLC, and they found out that Timothy's brother, Peter, was the executive vice

president of that company. So there's a lot of family business going on here. The piece then talks about Roberts's time at Big and Interira, which I've already covered here, so I'm not gonna go back over it. But the section framed Roberts as someone who had been involved in several remarkable failures, including ones that earned a reputation for lavish spending before the coffers ran dry. Next, the article

turned attention towards the headquarters for the company itself. It showed that the register information listing had Infinium Labs is address noted as fifty three eighty Gulf of Mexico Drive and Longboat Key, Florida. The magazine hired a photographer to go to the address to get pictures of the location, and what they got back where photos of a small strip mall that had one open office space that had inside of it a single desk with a telephone on it.

There were other small businesses at that address, but they were all identified that none of them were in Phinium Labs. Six months later, the magazine had tried again, sending another photographer out to that same location. Again there was no

evidence of an office operated by Infinium Labs there. They decided to inquire at a nearby mailboxes, etcetera that was part of this area, and they found that the mail that was being sent to Infinium Labs was going to a p O box at mailboxes, etcetera, and that the company did not appear to operate any physical space at that particular address. Curious or and curious er. Well, a story gets even more weird, But before I jump into any more of it, let's take another quick break to

thank our sponsor. Back to the story, So hard OCP reaches out to Timothy Roberts to get his response, and Robert said that things were just getting started over at Infinium Labs, and he admitted that there was no physical office yet, but that it was on its way and they are just trying to, you know, get everything in order. Now.

You could be really generous and say, all right, I believe you, but considering that the company was going to have to go into production soon to get units out by the holiday season, that was kind of tough, right, hard o CP was really skeptical because that time was coming up quickly and if they didn't have a physical space, how are they going to actually build these consoles that supposedly we're going to be on sale in time for

the holidays. They even followed up by sending a volunteer to a different address in Thenium Labs Corporation announced it was moving into a new headquarters building at eighteen nineteen Main Street, Suite eight hundred in Sarasota, Florida, and the volunteer said that when she went to the building, she looked at the directory and saw no companies listed for the eighth floor at all. There was an eighth floor, so at least there's that, but there was no one

listed for it. So she took an elevator ride on up to the eighth floor, and then she said, it was a post town. There was there's no occupation on that floor. Now, near the end of the article, you get to a pretty tough paragraph. I'm going to quote it. The facts speak for themselves. Company closures, bankruptcy, investors losing millions of dollars, and current director positions where the company isn't even sure he works for them and cannot find

his email address or telephone number. Mr Roberts has been involved with one successful business venture in eight years, according to his own resume. He followed that one up with several bankrupt and failed businesses. It's been documented by other sources that millions and millions of dollars were burned through in the last six years. We think that it's possible that the same fate could very possibly befall in Phinium Labs. Now.

The response from Infinium Labs was just as harsh. The company complained and said that they were going to file a lawsuit against hard O c P in Florida, saying that they had made these UH these unsubstantiated claims and accusations against the company and therefore had hurt the company's UH chances of raising money and getting investment, and therefore, if they failed, it would be because of criticism like

the kind from heart O CP. Heart O CP responded by filing a lawsuit for a declatory judgment and saying that they didn't do anything wrong from a judge. So the judge decided that he would hear the case and said that Anthidium Labs would need to present information about the company's business in Texas because they reportedly had an

office located in Texas. They would also have to provide information about their investors board minute meetings from around the time that the article was published in order to indicate whether the company was, as they had claimed, much further along than the article had indicated, and also other information such as Timothy Roberts's own personal income tax records, and Phinium Labs failed to acquiesce to those demands, and ultimately the company would settle out of court, reportedly paying hard

O c p. Fifty thousand dollars in the process. Now, in two thousand four, despite having nothing to show for itself other than this prototype that had been demonstrated, a couple of trade show events and Phenium Labs went public. They went from a privately held company to a publicly traded company. Timothy Roberts owned a whole lot of shares of stock, and by two thousand five things were looking particularly shady over at in Phinium Labs. Remember they had

missed to ship dates already with the Phantom Console. Well, Roberts decided to step down as CEO. He still had millions of dollars worth of stocks at the time, and he did something that got the attention of the US government. He hired a stock promoter to send out a facts blast to potential investors with claims that the company was on the verge of releasing the Phantom Console and then the value of the company was set to blast off into the stratosphere. So at the time, this was a

penny stock, meaning super cheap stocks for infinium labs. But with penny stocks, even the increase of just a couple of cents can mean a huge profit if you own a ton of stocks. So, as it turns out, it looked like Timothy Roberts was trying to drive up the stock price before he sold off his own stock. Roberts was ready to unload it once that price goes up, and that's called a pump and dump scheme. You do something to artificially pump up the value of a stock

before you sell off your supply. When the dust settles and people see that the hype was just hype, the price comes back down, but by then you're already moving on to your next gig. Right, Well, that's what the SEC said Timothy Roberts had done. That he had effectively run a pump and dump scam using infinium labs, and the SEC is the Security Exchange Commission, that they were

not happy and they had some serious concerns. Now Roberts would end up getting off relatively easy, all things considered. He was ultimately hit with a thirty thousand dollar fine after he reached a settlement with the SEC and as part of that settlement, he also agreed to not be an officer or director of a publicly traded company for five years, and he was supposed to stop playing with

penny stocks too. Back to Infinium Labs, the company changed its name to Phantom Entertainment, and by two thousand six they had kind of quietly ended all promotion and discussion of this console that never ever materialized. Instead, the company decided it was going to pivot and release a gaming mouse and keyboard, which sounded a lot like the lapboard that was originally going to be part of the Phantom

console hardware. In September two thousand six, they said this lap was going to start hitting store shelves in November two thousand six. In reality, it would take two more years before the lap board was actually available, towards the second half of two thousand eight. In two thousand seven, ARS Technica wrote another piece about the company, detailing its many problems, including how the headquarters had bounced around from Florida to Washington State to New York and was supposedly

going to move back into Florida. The article's author, Nate Anderson, detailed the many problems the company had with various creditors and its strategy of issuing more stock when it needed cash, and it did this a lot with companies like Merrill Lynch or the Motley Fool or Center Point Property, and on three occasions by issuing stock to members of the

Basharra family that had leveled three different lawsuits against the company. Now, this did not exactly paint the picture of a legitimate corporation. According to Anderson, by two thousand seven, the company had been operating at a net loss of more than seventy three million dollars. Yikes. When the Lapboard finally did come out, it ended up getting really lackluster reviews. A quick jump over to the Phantom Entertainment website shows that, amazingly enough,

it still exists. I don't know if the company does, but the website is still up. It hasn't been updated since two thousand eleven, but it is still there. As for Timothy Roberts, why has that scamp been up to since his departure from Athinium Labs. Well, in two thousand seven he founded a company called Game Streamer, or at least that's when the company's press release says it was

founded was two thousand seven. The actual existence of the company wasn't revealed until two thousand nine, so whether it had existed for two years secretly or not, who's to say. Now Roberts had listed himself as the CEO and CTO and president and CEO B on the company profile. This was a privately held company, however, so there was no conflict with this agreement that he had made with the c C a few years earlier, because that only applied

to publicly traded companies. It was also based in Tampa, and it was supposed to be a leading innovator in digital distribution and streaming solution for games. Now, Roberts wouldn't stay there for very long. In two thousand and ten, he and a guy named Terence F. Taylor, the CFO of Game Streamer, resigned to start a new company together. This was originally going to be a company called Platforms with a Z at the end, and it was a

digital distribution company. But we can't leave game Streamer that quickly, you see. The company would end up suing both Roberts and Taylor. They claimed that both of them had tried to secure trade secrets belonging to game Streamers for themselves Essentially, the allegation was that Timothy Roberts had registered domain names and trademarks under his own name rather than under the Game Streamers company name, and that he then planned on using those same ideas in a business this that would

compete directly with game Streamers. The company also accused Roberts of threatening them, saying that he was going to reveal confidential company information that would ultimately harm the business. Now, Taylor and Roberts countersued Game Streamers. They alleged, among other things, that they were both being fired for game Streamers because they refused to convert to Seventh day adventist. I am not making any of that up. Ultimately, those lawsuits would

all settle out of court in two thousand eleven. But our story ain't over yet, folks. Roberts and Taylor would launch another business in two thousand eleven, and it was called Savtira. It was billed as a cloud computing company,

and its name was a combination of Savva's. Remember that was the first company Roberts had worked with, and in Tira, which was that big failed company he had worked with, Which makes me wonder if Roberts was running out of ideas at this point to combine two names of previous businesses into a third one, and it's height. Savtira had a valuation of five hundred million dollars. But he is

the problem. It was actually worthless. In fact, Sevtira had to declare bankruptcy in two thousand twelve and it went into Chapter eleven, but then was forced into Chapter seven, which means it was liquidated. A judge ordered all assets liquidated to pay off creditors. Robertson Taylor had been selling stock certificates for a company that simply could not conduct business as was claimed, and this wasn't just bad news to wealthy investors who were out of a big wad

of cash. Savtira's employees suffered as well. There were real people who had been working for a company under the belief that it was a legitimate business, but their paychecks stopped as the company ran out of cash, and toward the end, the company's bank account was at negative five thousand dollars before they were able to secure at two

fifty thousand dollar alone. Allegedly, a good amount of that loan would end up going to some personal expenses that roberts had accumulated, rather than to actually pay off creditors of the company. According to prosecutor, because yes, of course this is going to end in another court case. It was all based on false revenue projections. That's what the value, the perceived value of this company was hinging upon. Robertson Taylor would be arrested on charges that they committed wire fraud.

Roberts pled guilty or pleaded guilty, and his sentencing was scheduled to happen in two thousand and seventeen, though as of the recording of this podcast, that still hasn't happened. It may happen sometime in mid March. Last I heard, Uh. He faces up to twenty years in prison. His buddy Terrence Taylor, also pleaded guilty to wire fraud charges, and he was recently sentenced to five years in prison back

in December two thousand seventeen. Now, there's a lot more I could say about roberts For example, he also led a company called hashing Space, which is a bitcoin minor hosting service. Terrence Taylor was the CFO over there too, but after the Feds served a six count indictment against the two guys, they both up down from that company. Hashing Space continued on buying out Roberts's ownership of the company. Anyway, that's the story of Timothy Roberts and the Phantom Console,

and I want a cookie. I do not know to this day whether or not the Phantom Console was ever sincerely going to be built, or if in fact it was just a shell so that Timothy Roberts could raise a lot of money from investors and then spend it however he liked. I don't know the answer to that.

There are a lot of indications that showed that there were at least some cursory attempts to create some hardware, and I'm sure people who are working for the Phantom are for Infinium Labs and then later Phantom Entertainment believed in their heart of hearts that they were working on a product that was going to go to market. But whether it was a sincere attempt or just a hoax from the beginning, the fact remains it never went anywhere,

and it became kind of the laughing stock. It was one of those things that was held up as not just something that to ridicule, but something to show as an example of what can happen with Vaporwar, so an incredible story, and uh, maybe we'll follow up on this later on and talk more about some of the fallout and also some of the things that have happened in the wake of the Phantom console that brought some of

those ideas to life. Like I said, while those ideas were way ahead of their time, they are ones that have found their ways into various game platforms today, whether it's PC based stuff like Steam or it's video game consoles. We've seen those concepts worked into video gaming. So there were some really good ideas there. If they had been executed properly, maybe the landscape of gaming would be very

different today. Maybe in Phinium Labs would be the valve of today where they'd be the dominant player in PC gaming distribution. But as it stands, not so much. As for Phantom Entertainment, I honestly don't know if they're still an operation or not. The website still up though, so you can go check that out. If you guys have any suggestions for future topics I should tackle on this show,

let me know. You can send me an email the addresses tech Stuff at how stuff works dot com, or you can drop me a line on Facebook or Twitter. The handle we use at both of those is tech Stuff hs W. We have an Instagram account. Make sure you follow us over there. And remember I live stream recordings of tech stuff on Wednesdays and Fridays over at twitch dot tv slash tech stuff, So just head over there.

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