Ringing Bells had rung bels after it announced the cheapest ever mobile phone, the Freedom 251. Let’s try to get to the truth behind Freedom 251, which had made waves a few weeks back. The phone costs just about $4 in the Indian market. There was quite a ruckus when the news first came out in the market that there is a smartphone available for a throwaway price. We have seen cheap and even cheaper mobile phones. However, the tag of “cheapest ever mobile phone” for just INR 251 certainly raises the eyebrows.
Truth Behind Freedom 251
Not many people knew about Ringing Bells until it made waves in the mobile industry world. The reason? The cheapest ever mobile phone in the world. And what’s the cost – just in three figures. It’s the Freedom 251 for you. Can you believe it? The Freedom 251 boasts of 4-inch IPS screen, 1GB of RAM. The internal memory is 8GB with a 3.2MP camera. And yes, don’t forget, the device is dual-SIM 3G enabled.
Let’s now try to get the truth behind Freedom 251. As a matter of fact, the cheapest smartphone available at the moment, of course, apart from the Freedom, is the Trio Trio Smart Touch Phone Junior 3. The phone comes at a cost of Rs. 1,449 and is available on Flipkart. Remember, it’s just a 2G smartphone. On the other hand, the Freedom 251, is 3G enabled, as said above. Considering the specs mentioned above, the cheapest phone will then be with a pricing of Rs. 2,999 – the Datawind Pocketsurfer 3G. Naturally, it comes with lower specs and features.
Price Fighting: Truth Behind Freedom 251
Under any circumstances, it is really hard to agree that one can get a smartphone with these specs at just INR 251. Pankaj Mohindroo, who is the president of the Indian Cellular Association says:
“Pricing is not possible under any circumstances, even if the components are made in India”.
According to him, all the material that would be needed to build the Freedom 251, or a similar phone, would alone cost in the region of $40 or around Rs. 2500. The CEO of Datawind, Sunit Singh Tuli, also expressed similar views. He says a phone having the specs of such a phone should at least cost eight times more.
What the Company Argues
The company has replies to these queries. Ashok Chadha, the president of the company says that it is possible to get this selling price by manufacturing the material locally. The material is developed in the Indian states of Uttar Pradesh and Uttarakhand. The scale can be gauged once the ball starts rolling up to 5 lakh units in a single month. As the goods are produced locally, they won’t have to pay that extra 13% or so import duty. Now, getting the truth behind Freedom 251? However, experts like Gogia are of the opinion that local components tend to be costlier than those that are imported.
How the Pricing of Smartphones Work
Most of the times phones carry Bill of Material (BoM) cost. Apart from this, there’s the manufacturing cost. This is aside from the various duties and taxes exercised by the government. Two other things are included in this and they are the marketing expenses and profits. Keeping all these things in mind, the selling price of the smartphones go up.
Considering the truth behind Freedom 251, we must say that when it comes to offline sales, a dealer stands to get a reasonable margin and that’s the reason why there are so many iterations of price tags of a single product.
Here is a good piece of info for you all. The costliest part of the smartphone is generally the cellular radio followed by the processor and other components. Put together, it makes up for almost half the cost of the phone. The mechanical parts and display, memory and camera units follow next. However, there are devices like the iPhone wherein, the screens prove to be the costliest of the lot.
According to HIS Inc., a business analysis company in the US, the costliest part in the iPhone 5S was its 4-inch retina display. It alone carried a pricing of $41. It was followed by the wireless module for $32. Compared to the display, the processor cost less than half at $19. The 16GB version had an estimated cost of $198.
If this logic is considered, the truth behind Freedom 251 is that the cost of the wireless module should be somewhere about Rs. 65. And yes, the display will be even cheaper.
So, now you can decide for yourself, if the Freedom 251 is rightly priced or if there are things that make you raise doubt over it. Don’t forget to put in your comments below so we know your opinion about the truth behind Freedom 251.