World′s cheapest smartphone launched in India | Business| Economy and finance news from a German perspective | DW | 17.02.2016
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World's cheapest smartphone launched in India

Indian company Ringing Bells has launched a mobile phone that costs less than $4. Low-priced handsets are particularly popular in what is now the second-largest smartphone market globally.

Indian consumers are known to be price conscious, but at just 251 Indian rupees - around $3.60 or 3.30 euros - Ringing Bells's new device is a snip not just by Indian standards. It is also the cheapest smartphone worldwide.

The Freedom 251 - dubbed the "biggest revolution in the telecom industry" by the Indian firm, will go on sale in India on February 17.

The handset runs on the Android 5.1 Lollipop operating system, has a four-inch color display, a 1.3 gigahertz processor, and two cameras: a 3.2-megapixel back camera and a 0.3-megapixel front camera.

The low price was a subject for debate on Twitter, with users comparing it to the price of a Biryani or underwear.

Ringing Bells, which was established last year and focuses on affordable smartphones, developed the Freedom 251 with the help of the government's "Make in India" campaign that aims to boost investment in India.

Indian Defense Minister Manohar Parrikar was expected to be the chief guest at the phone's official launch on Wednesday night, according to Indian media reports.

India's mobile phone market is huge - according to Counterpoint, a market research firm, the South Asian country has the second-biggest smartphone market in the world after China, surpassing the US for the first time.

More than one in three cellphones shipped in India is a smartphone now, with 220 million users registered at the end of 2015. With a population of around 1.3 billion, there is still a lot of potential, especially in rural areas, where simple phones are still the norm.

Counterpoint says almost half of all mobile phones sold in the last quarter of 2015 were made in India, with at least 20 brands now assembling their phones in the country.

South Korea's Samsung leads the Indian market, with domestic brand Micromax in second place. Meanhwile, global bellwether Apple is catching up in India, and competition from China will make the market "highly competitive" in 2016, according to Counterpoint.

Apart from the sheer size of the Indian market, companies also rate India for its high share of young people. Although China has been more important for Apple in the past, as consumers there are more willing to spend, at a recent investor call Apple CEO Tim Cook said with a median age of 27 "I see the demographics [in India] being incredibly great for a consumer brand and for people who really want the best products."

Whether the Freedom 251 phone will take off remains to be seen. Because although many Indians are known to keep a close eye on prices, other cheap product launches have failed to ignite the market. Tata Motors' no-frills Nano car, launched in 2009 and intended as the company's growth engine, never exactly sold like hot cakes.

And, as the Indian daily "Hindustan Times" points out, the government-backed affordable Aakash tablet that was developed to provide Internet access to as many people as possible flopped due to its "barely acceptable specifications."

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