There is a popular belief in our country, that development, progress and technology takes its time to reach us, but it does, its potential is enormous. This could not be more true regarding the launch of the Freedom 251 handset- the device that is said to be the world’s cheapest smart phone priced at just Rupees 251/- or under 4 US Dollars.
The phone in itself has received mixed reviews and tech and gadget blogs and media outlets are correct in questioning the possibility and the math behind the pricing of the product, we are choosing too look at it as a singular device that could very possibly put a camera in the hands of almost every India.
The launch event in itself was not very well organized or media managed, but we did get certain key questions answered from Mr. Ashok Chadhdha, the president of the company Ringing Bells, the manufacturers of the phone.
Key take aways from what he told us-
1. The chipset and other components are being imported from Taiwan at present, and about 60% of the phone would be made in India. The goal of the company is to completely manufacture the phone within one year.
2. The company has not set up any plant as of yet, but will be investing about Rupees 500 Crores (USD 70 million) total in setting up 2 plants in Noida and Uttaranchal. This investment is done by the holding company (Mr. Chaddha’s family run business) through debt-equity in a ratio of 1:1.5 times. Mr. Chaddha strongly suggested the entire project has no government funding or subsidy.
3. The company’s targeted capacity is of 5 lakh units each per month, with a goal of having 5 manufacturing centres all over India.
4. Very ambitiously, the company wants to sell approx. 1 Crore units per month and aims to capture as much as 25 percent of the market share in the first year itself.
5. The company provided no timeline on the setting up of the plants but has today started (and closed due to heavy rush) pre orders for the phone that it hopes to deliver the products by end of June.
6. As far as the pricing of phone is concerned, Mr. Chaddha explained- “The bill of materials (cost of manufacturing parts) for a phone like this is around Rs. 2,000 – by making in India we take away around Rs. 400 from that; by selling online we cut overheads and save another Rs. 400,” explained Chadha. “And as the numbers go up, we’re not talking lakhs but much more, we save another Rs. 400 from economies of scale. And then, our platform becomes big, and attractive to others, so we can then highlight products that are worth buying for our customers, and this is another source of income. We will pass all of this on to the customers, we want to make only a small profit per unit.” There are certain problems with this idea though, Rs. 400-500 saving through online sales is unexplained and a bit speculative. Mr. Chaddha did not explain to us how this actually impacts the offline sale through distributors in rural areas.
Additionally, while the economies of scale and the duty protection through the Make In India scheme do count as a saving on the total costs involved, it doesn’t cut down into the cos of materials of the phone, and will not be affected whether the phone is sold online or offline.
At the launch event, there was only one prototype available to the press, though a bit surprisingly it had the brand name of Adcom, a Delhi based importer of IT devices covered with a sticker. The device in itself bears a lot of resemblance to Adcom’s Ikon 4 mobile device. The company admitted that this was only an assembled prototype, for demo purposes only, however they also added that the actual device would be very close to this.
The device will run Android 5.1 Lollipop, have 1GB of RAM, support 8 GB of memory which is expandable to 32 GB via a Micro SD card.
Most importantly, the device will feature a 3.2 megapixel rear camera, which is bit of a let down. The demo device was not fully operational so we could not get any sample pictures to test out the camera’s compatibility. We only managed to get the device in our hands for a few secs and a few quick clicks-
We hope the company can resolve the few key issues soon, including the speculation regarding the BIS – Bureau of Indian Standards Citification as the idea and the thought behind the product has enormous potential. We will be getting a device for indepth testing and review soon so stay tuned!
If you like our content, don’t forget to show us your support-
Receive regular e-mail updates by subscribing to our Newsletter