Project Ara is an attempt by Google to make the worlds first modular smart phone. The idea of the project is to create a phone that can be completely customized with parts that can be swapped out whenever you want. Now this may seem like something that could be quite complicated to use but it should not be at all if Google achieves what they are aiming to do.
The idea for Project Ara came from a man called Dave Hakkens. Dave Hakkens originally came up with the concept of Phonebloks in 2013 and gained a lot of attention on the internet which was what it needed as he basically trying to crowd fund it without a site like Kickstarter. Motorola Mobility initially expressed interest in the idea and eventually got Hakkens to work for them and help build the phone. Google had acquired Motorola Mobility in August 2011 so that meant that Hakkens was working for Google really. Google then sold Motorola Mobility at the end of January this year but part of the deal was that held onto what is now called Project Ara; this has meant that Project Ara is still very much based on the Phonebloks concept.
So the basis of this phone which you will have to buy originally from Google is being referred to as a "Grey Phone". This will be the very basic core of the phone with other very important things such as the processor, screen, and camera being modular tiles which you would have to add. This means that you can make this phone as expensive or as cheap as you want. This makes the phone open to so many different markets which is Google's aim, they want it accessible to 6 billion people. So if you were someone living in poverty in a third world nation this phone would still be accessible to you as you could buy the Grey Phone and then just the basics modules to make it run such as the low end processor, screen, and battery which would make it incredibly cheap. Over time then if you have saved up some money you could then add a camera module or upgrade the processor. Then on the other hand if you millionaire living in Dubai you can get the Grey Phone and then deck it out with the best modules available such as the fastest processor, 4k screen, best camera, and all of the other things available. This would mean that your phone could last much longer than the normal 18 or 24 months as you could just keep on upgrading parts to make it more relevant to the technology at the time. 
The idea is that the Grey Phone will come in 3 different sizes, small, medium, and large making it even more customizable and the goal is to make the Grey Phone cost just $50 and so after you have bought the most basic modules just to make it run it will cost much less the cheapest smart phone around now.
Of course a problem like this is going to have many issues during development and there have been and there will be many more.
Many of you after reading maybe asking, "When can we get one?". Well the team behind Project Ara has said that their goal is to have the first model released by January 2015 which is not that far away really. But I think it is unlikely that it will be released then as the alpha is going to be released to a select few, much the same as Google Glass and that has not had it's full release yet.
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