Ringing Bells and its Rs 251 smartphone, Freedom 251, is one of the was among the most talked about phones in India. The company that many doubted whether would ever deliver the promised device has started shipping the Rs 251 smartphone, and, surprisingly, for the said price.
Out of the promised 2 lakh units, 5,000 units are out there and ready to be shipped. This morning, CEO Mohit Goel revealed a state-wise breakup as seen below. The number includes 4,240 units already being shipped. The rest of the units, 760 in total, are in the process of being shipped to UP where he intends to visit some cities, such as Meerut and Shamli, and deliver the devices himself.
During our last conversation with Goel, he had said that the second phase of Freedom 251 shipments will begin only when they see some positive signs or support from the government. Today, he adds, “Me asking for support has been misinterpreted.”
“I don’t want to talk about the support as it has shown me in negative light. I am not capable of providing smartphones to 75 crore (increased from the 60 crores we heard of last time) people. Going by Rs 600 loss per unit, it turns out an overall loss of Rs 45,000 crore. But the government could make some amendment to make this possible, if not my company than some other company. The motive would be to reach out to people without phones, get them connected and help in the digital drive,” he added.
Looks like, Goel has taken it upon himself to get India digital. Now, it is a noble cause. But, what he fails to realise is that the decision to bring 60 crore (or 75 crore) units of Freedom 251 to India was a decision he and the company made. He wasn’t forced into selling a device at Rs 251 by anyone. We couldn’t agree more when he says India needs a Rs 251 Freedom 251 to get smartphones within people’s reach, but by no means is the government obliged to help them, if they don’t wish to do so. Economies of scale and other company theories didn’t fall in line. Thus, a failure in the initial plan or bearing losses is something he will be responsible for as a businessman.
Now, aren’t reams already been written down about how Ringing Bells possibly plans to manage the losses? In the past, we have seen many talk about the infeasibility of building a device (with the said specs) at the price. In fact, loss of Rs 600/unit also seems rather difficult to assimilate. Going back to the mission to get people connected, the one who wants to help people will have to actually find a way to help people. Freedom 251 is being sold online and not in remote areas via offline channels. To get to the people without the means to stay connected would mean selling devices in those areas.
Goel tells us that 60 crore or 75 crore units won’t be possible without some help in the form of a subsidy from the government. However, he does add that Ringing Bells will consider a second phase, but with small, manageable numbers such as 1 lakh or 50,000 units. Depending upon the time taken to ship 5,000 units, we expect the first phase itself to be a lengthy affair. Moreover, Goel said that he plans to take feedback from the initial device users, before shipping the rest.
By providing 5,000 units, the company has only managed to offer 0.025 percent of their initial promise of 2 lakh units, but at least we know Freedom 251 isn’t entirely a scam or that Ringing Bells is fraudulent. However, the slow rollout also reveals that the company made some big, difficult-to-achieve promises right at the very beginning, without gauging the markets and relying on its less experience. I think, it may also decide to halt the program in a few months.If that happens, then the Freedom 251 can be called a stepping stone to open the gateway to its other products. It recently announced six mobile phones, and has already received 55,000 pre-orders for the same. The company has planned an event later this month, with stars of an upcoming Bollywood movie, to launch its LED TV. If it manages to deliver on the TV promise, the company may possibly offer some of the best-selling budget devices (especially TVs), considering the Diwali shopping season. However, with promises and re-promises and skewed up delivery dates, Ringing Bells leaves some lingering trust issues. After all, trust has to be earned, and the company’s initial promises has made a huge impact on how it is being viewed.