Alarms bells have sounded since the launch of a $4 smartphone in India last week with experts and consumers alike raising serious doubts about the astonishingly cheap price.
India’s government and telecoms industry regulators are closely monitoring ‘Ringing Bells’, the company which launched their Freedom 251 phone, so-named after its 251 Indian rupees ($3.66) price tag. Ringing Bells said they would start delivery to customers in April.
A gala event in New Delhi on 17 February triggered a rush by millions of would-be Freedom 251 customers to register online to buy the smartphone. Rival Indian telecoms businesses, understandably miffed at Ringing Bells’ rock-bottom pricing, are not yet sure how Ringing Bells is planning to make any profit or avoid losing money, but the Indian telecoms market is not only potentially enormous but largely unregulated.
Since the little-known Indian manufacturer announced its Freedom 251 prototype, it has made headlines across the world. The ultra-affordable smartphone, apparently featuring a standard 4-inch touch screen, a 3.2 megapixel camera, a 8GB internal memory and the latest Android Lollipop 5.1 operating system, is seen by many professionals as too good to be true.
“This pricing is not possible under any circumstances, even if the components are made in India,” says Pankaj Mohindroo, president of Indian Cellular Association (ICA). The association sent a letter to Indian Telecom Minister, Ravi Shankar Prasad, saying “the rate could not be below Rs 3,500 ($51) even after a subsidised sale” in order to pay for the material.
There have been rumours about Indian public subsidies being used to compensate for the low price, fuelled by the presence of some government apps pre-installed in the prototype devices, but Ringing Bells’ president Ashok Chadha denied any state support.
Putting aside underhand subsidies from public funds, there have also been many eyebrows raised at the Freedom 251’s flagrant similarity to the iPhone interface, clumsy copying of rival Indian Adcom phone brand, and the apparent absence of Ringing Bells from the Bureau of Indian Standards’ and Android lists of approved partners.
These allegations may, of course, be the cries of jealous rivals in an attempt to discredit a new-born company that might overtake them. Maybe the real ringing bells will turn out to be the alarm ones.