Mobile phone for Rs 251 rings in disbelief
NEW DELHI: A little-known company from Uttar Pradesh launched the world’s cheapest smartphone, which will cost Rs 251 for a device with a 4-inch display, 1 GB RAM, 8 GB internal memory and dual-SIM option. But the launch by Ringing Bells, an agro-commodity trading company, was mired in controversy right from the word go.
Alleging unfair price under-cutting, the mobile manufacturers association is calling for a government probe into the costing of the phone. Eyebrows were also raised at the similarity in looks between the phone and Apple’s iconic iPhone.
Notwithstanding the controversies, the unveiling of the device – Freedom 251 — generated quite a flutter in the market as its pricing has the potential to disrupt the volume-laden and fast-growing Indian smartphone market. Bookings for the Freedom 251 – which will be assembled at a factory in Noida while the parts come from Taiwan – will open on February 18 from 6am (online at www.freedom251.com) and close on February 21 at 8pm. The company says deliveries will be completed by June 30.
A regular 3G device in the market currently costs no less than Rs 3,000, which it itself seen as very aggressive. A large swathe of device makers, including companies like Micromax, Samsung, Lava, Karbonn and DataWind are already selling devices in this category, but at much higher prices than the Freedom 251.
The company behind the Freedom 251 said it is being developed in sync with the Modi government’s ‘Make in India’ and ‘Digital India’ initiatives and would help bring down the affordability of smartphones by a large degree. “However, we are not receiving any subsidy from the government or any other official agency,” a senior official of Ringing Bells said.
So how has the company managed to get a near-magical figure for a device that runs on a 1.3GHz quad-core processor device, and comes with a charger, headphones, screen-guard and a one-year warranty while also carrying a 3.2-megapixel back camera, 0.3-megapixel front camera, and a 1450mAh battery?
“We are working on a variety of cost-saving initiatives to keep the cost of the devices lower than its approximate per unit price of Rs 2,500. These include local assembling in India that saves us around Rs 400, large-scale sourcing that saves around Rs 400-500, online sales with no on-ground staff that itself saves us around Rs 500. The rest of the savings come in from an online marketplace that we create on our website by allowing other companies on the platform,” Ashok Chadha of Ringing Bells said.
However, industry experts said the device is being sourced from Adcom, a Delhi-based importer of IT products which is already available at some e-commerce websites, but at a higher cost.
The Indian Cellular Association (ICA) – which has members such as Samsung, Apple, Sony, Lava, Micromax, Karbonn, Motorola and HTC — said the pricing and the way it has been subsidized needs to be investigated.
In a letter to telecom minister Ravi Shankar Prasad, ICA said the government should go in-depth into the pricing mechanism. “For your kind information, the bill of material (BOM) value for a product like this when sourced from the cheapest supply chain costs approximately USD 40 (Rs 2,700),” ICA said. “And this, when translated into retail price after addition of applicable duties, taxes and with distribution and retail margins would be at least Rs 4,100, while the product is being sold at Rs 251,” ICA national president Pankaj Mohindroo said in the letter.
Defence minister Manohar Parrikkar was earlier slated to be at the launch, but decided to give it a skip at the last minute.
Meanwhile, Ringing Bells said that it would aggressively open multiple factories in the country. “We design and produce smartphones to provide a satisfying mobile experience for users, so that their valuable time is spent doing things/tasks they love, instead of figuring out ways to use the phone. We have a complete in-house product testing set-up in India,” the company said, adding that it would offer apps for women’s safety, fishermen and farmers and others such as ‘swachh bharat’ pre-loaded on the device. However, these were not on the device shown to the media.