Controversies on Low priced Freedom 251

The following article is based on my own interpretation of the said events. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.

Sidhartha Sankar Nanda, MBA 2015-17, Vinod Gupta School of Management, IIT Kharagpur

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Freedom 251 created quite a stir when the local Noida based company Ringing Bells announced online booking of smartphones at just Rs. 251. Although China tops in making of low priced smartphones but this mobile stands out for the fact that no other company have thought of making this kind of well featured smartphones at such an affordable price.

With an alarming booking of orders worth Rs 1.75 crores via the website freedom251.com, the company has recently stopped the bookings and will resume once the product is delivered to the customers who have already placed their order. In response to the payment issue raised by the customers who have not received their orders, Ringing Bells has claimed that it won’t actually be taking the payment from the payment gateway facilitator PayUBiz, until it gives proof of delivery. And for all others who are planning to place an order once the booking process resumes, Ringing Bells plans to introduce Cash on Delivery option.

Certain other controversies that stands as a major drawback for this model is its fraudulence of identity regarding its association with Make in India initiative. It is said to be bearing the logo of Adcom concealed with a whitener. When investigated from the Delhi based brand, Adcom that sold its phone for around Rs. 4000, totally denied knowing anything about the utilization of its market by the new brand. Further government has also clarified that its Make in India initiative does not back or support Freedom 251, the world’s cheapest smartphone launched on February 18, in any way. The flagship of ‘Make in India’ initiative and association of big political names during the promotion and launch had brought high hopes for everyone but now With the Make in India team clarifying it’s position, the onus now rests on the company to deliver the booked handsets.

Another issue that has added on to the worries of the customer is its  rock-bottom pricing which has led to people questioning the model of the company and whether there was any government subsidy involved.  Contradictorily,  BJP lawmaker Kirit Somiya and the Indian Cellular Association, claims  that the phone offered by the company would cost atleast Rs 3,500 after all subsidies. The government opines that the cost can be as low as Rs 2,300.

However, the company still claims that it makes a profit of Rs 31 on every smartphone sold at Rs 251, again raising doubts on its model.

Keeping the above controversies in mind, we can only make assumptions on the credibility of the company until  it reaches out to people. However, We expect that the brand stands up to the expectations and sets up an history.

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