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India's $4 Smartphone Seems Too Good To Be True

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India's $4 Smartphone Seems Too Good To Be True

Four dollars doesn't buy you much these days, but in India, it can buy you a smartphone.

An India-based company that is virtually unknown outside of the country called Ringing Bells Pvt will begin shipping its Freedom 251 phone. According to Bloomberg, the phone is a quad-core processor with a four-inch screen with front and back cameras for 251 rupees, or approximately $3.80.

Ringing Bells' phone is attractively priced, especially compared to Apple Inc. (NASDAQ: AAPL)'s $700 iPhones and even SAMSUNG ELECTRONIC KRW5000 (OTC: SSNLF)'s entry-level devices that sell for less than $100.

Related Link: What Challenges Does Tim Cook Face In India?

According to Forrester Research, there are 222 million smartphone users in India, and this figure is expected to surge to 517 million by 2021. Meanwhile, the market for phones under $150 is expected to grow at 44 percent this year.

Naturally, it is difficult to imagine how a phone that sells for $4 can be done at a profit. As noted by Bloomberg, the company's managing director Mohit Goel acknowledged it stands to lose hundreds of rupees on each device sold, but hopes to make up the difference through advertising and marketing agreements.

There is also another hurdle for Ringing Bells to overcome as the company received interest from more than 70 million people who scrambled to pre-register for the device. Unfortunately, only 200,000 devices will be shipped to the lucky few who win a lottery draw.

 

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