A new Made-in-India phone for less than $4

Okay, it smells familiar: the Indian government put out a solicitation for the development of the world’s cheapest e-tablet in 2012; one that would sell for no more than $40 a pop. The device would be based on Android, Google’s free operating system (OS) for smartphones. The high-profile project, which was dubbed “Aakash,” or “sky” […]

Okay, it smells familiar: the Indian government put out a solicitation for the development of the world’s cheapest e-tablet in 2012; one that would sell for no more than $40 a pop. The device would be based on Android, Google’s free operating system (OS) for smartphones. The high-profile project, which was dubbed “Aakash,” or “sky” in Hindi, even attracted the attention of the Secretary General of the United Nations, who commended the initiative for its “Mother Theresa-like” concern for the poor.
A motivation for the tablet project is to enable India’s rather large population of poor people to afford some modern, touchscreen, high-tech computing device, while at the same time promote the manufacturing of high-tech equipment in the country. Moreover, manufacturing the gadget would have supported India’s aspirant position as what the New York Times calls “a leader in frugal innovation.” The tablet would also find extensive use in colleges and universities across India, to help straighten some slacks in the country’s deteriorating educational system. We covered this story in the 14 January 2013 article in this column.
A small company in London (England), DataWind, which is owned by an Indian, Suneet Singh Tuli, won the bid for the project. However, according to the 30 December 2012 issue of the New York Times, Mr. Tuli acknowledged that his company would not “even come close to shipping the 100,000 tablets it has promised to India’s colleges and universities before the year-end deadline.” Moreover, according to the New York Times article, “most of the 10,000 or so tablets delivered through early December were made in China, despite DataWind’s early pledge to manufacture in India.”
In the current episode, it’s a little-known, barely five-month old, Indian company, Ringing Bells Pvt., that announced 11 days ago (18 February 2016) that it would sell millions of Made-in-India smartphones for less than $4 a piece. The phone has the jazzy name “Freedom 251,” which is an apparent reference to the promise of democratisation engendered by the dirt-cheap cost of the phone (Freedom) and the price of the phone in rupees (251). This amount works out to roughly $3.65; shipping cost brings the total cost of owning this phone to $4.25 (or N846 in Nigerian currency).
With this payment, you get a phone with a 4-in. display, a 3.2 megapixel camera, 8 GB of storage, 1.3 GHz quad-core processor and a 1,450 mAh battery. (“mAh” stands for milliampere-hour, or one-thousandth of an ampere-hour, which is a unit of electric charge equivalent to the charge transferred by a steady current of one ampere flowing for one hour. An “AA” battery has 2,500 mAh, while “AAA” has 1,000 mAh.) Freedom 251 will run Android Lollipop 5.1 OS and come preloaded with a handful of apps, including Women Safety. In addition, the phone has slots for 2 SIM cards, and it looks exactly like Apple’s iPhone 4.
All these features for $3.65 makes this phone the one to beat anywhere in the world. No wonder, orders for the phone and hits on the company’s website went off-the-roof – Ringing Bells reported over 600,000 hits per second, which eventually brought down the website.
Well, as is often the case, when it sounds too good to be true, it probably is, and Ringing Bells’ offer is not without controversies, with the leading issues being the economic feasibility of a $3.65 phone and who is really manufacturing this phone. (The Indian government is looking for Made-in India phones.) To cut the long story short, expert findings suggest that Freedom 251 is nothing more than a cheap phone that is made in China, not India. Experts believe that Ringing Bells is merely rebranding a smartphone model of Adcom, which sells the same product as Freedom 251 for 4000 rupees. (In fact, it has been discovered that Ringing Bells covers up the name Adcom with a sticker, in the display models.)
The second issue, economic feasibility of Freedom 251, has attracted the attention of the Indian government, who has set up a procedure to investigate Ringing Bells. All analyses so far suggest a minimum production cost that is an order of magnitude greater than what Ringing Bells is asking for. That is, more like $40 – $60. So, the government wants to know how Ringing Bells wants to do it.
Meanwhile, Ringing Bells’ president, Mr. Ashok Chadha, stands by his offer and confirms the promised shipping date of 30 June 2016. The company cites economies-of-scale, tax breaks for local manufacturing – though not mentioning the use of child labor, and “other cost-cutting measures,” as the factors that will do the trick for them.
Many experts do not believe that Ringing Bells can deliver on its promise. Fortunately, the low cost of the promised phone implies little loss in the event that the device does not materialise, though legal issues may abound.