Freedom 251: Reason why the phone at Rs 251 is not ringing for everyone?
Ringing Bells Freedom 251 could be the actual democratisation of the smartphone. At this cost, there should be no one in India who does not own a smartphone, should be online within a couple of years.
Yet, things are not that easy. If there was a chance to fabricate and sell a cell phone at under $5, the Chinese ODMs would have done it way before. Nearer home, why indeed would a substantial national player like Micromax have left that door open for a modest Noida firm to manipulate first?
“A 3G device with the specs offered has a foundation production cost almost 8X higher than what is being offered. So, we are interested in learning of how they’ve achieved this, including all licensing fees, etc.
The company continues to make affordable smartphones and tablet computers, but the cheapest smartphones of Tuli is a 2G device priced Rs 1,999 and 3G apparatus, with similar specs to the Ringing Bells Freedom 251, costs Rs 2,999. This is why even Tuli concurs that the cellphone, at least on paper, is radical. “If they deliver their assurance on quality, this will definitely behave as a challenge to the complete mobile handset market.
But if it turns out to be short quantity promotion, it will establish a negative example for the company.” By The Way, Datawind is working on Rs 1,500 and Rs 999 smartphones which it expects to start in the next quarter.
“We welcome anybody interested in breaking the price hurdles, and trust that while following in our footsteps, they’d see even greater success than we have seen,” says Tuli, describing how Datawind “helped the tablet PC marketplace grow 20x from 2.5L units to 50L unit in the last four years by breaking the affordability barrier”. They claim to have sold over 25 lakh units in the marketplace so far. However, all this pales in front of the form of numbers Ringing Bells is flaunting. Given the form of interest a Rs 251 smartphone will create and the company needs to get an installed capacity of 5 lakh units, this could only fall short.
In addition, the company needs to use Indian parts to reduce the cost and avoid taxes. Whether there are Indian companies manufacturing smartphone components, then it is odd other OEMs don’t know about them.
Sanchit Vir Gogia, CEO & Founder at Greyhound Knowledge Group, says the mobile is extremely interesting. But then, it is exceedingly subsidised to start with and whether or not it stays is a huge question.” While the phone might be compared to a regular cell phone, Gogia says, it might not do justice to users anticipated expertise. “While a smartphone is a variable of cost, the other major variable is better touch encounter and apps,” he explains. Gogia says it will be hard to sustain the price in the long run.
Also, the very fact that the firm creators don’t have experience in this field might prove detrimental to its prospects. He’s also unwilling to take the company’s claim that there is no government subsidy on the telephone. “The phone is loaded with Make in India programs. Clearly, there appears to be some arrangement,” he said, adding that even if they source elements locally, they do not come cheap. In addition, the mobile needs to be reserved online only, a characteristic that might prove a stumbling block for lots of those who might want to take a physical look first before purchasing. Customers can buy this product offline only after June 30.