Ultracheap smartphones running on Firefox OS gets cold shoulder in India

Via The Economic Times | Mar 20, 2015

It's Nano all over again
in smartphones. In August last year, Intex launched the
world's cheapest smartphone in India. Priced at Rs 1,999 and running on Mozilla
Firefox operating system (OS), this phone was supposed to be a winner in a fast
growing but price sensitive market. Three other brands, Spice, Zen Mobile and A
lcatel One Touch also sold ultracheap smartphones running on Firefox OS. There w
ere online deals with Flipkart and Snapdeal. But the data is in, and the Nano of
smartphones, just like Nano the car, has flopped. Data from Cybex Solutions, a
firm that tracks export-import data, shows between August and December, only 154
,000 Firefox phones were imported. And in January and February, Zen, a really sm
all player, imported around 10,000 of these phones. These are minuscule numbers
compared to average monthly sales of 7 million smartphones in India. The market
verdict has been as quick and as harsh for ultra-cheap smartphones as it was for
the ultra-cheap car. Mozilla responded to ET's questions by saying "the informa
tion (on poor sales) is incorrect" and that "Firefox devices have a steady deman
d".
But Firefox phone vendors ET spoke to were unambiguous in their agreement that t
he ultracheap phone hadn't taken off. Firefox phone-sellers say imports are some
what more than Cybex data but they don't deny the failure of 'Nano' smartphones.
"There was little commercial viability," said Sanjay Kalirona, head of mobile b
usiness at Intex. Spice Mobility's CEO Prashant Bindal says, "It doesn't matter
even if you're providing smartphones at very low costs...the consumer had to be
convinced that they should buy this phone." Zen Mobile Managing Director Deepesh
Gupta said, "People don't mind paying a little more for phones they like more."
In August last year, Kalirona had said three more Firefox smartphones, includin
g a 3G-enabled one, would be launched within a year. Those plans are now all his
tory. And the Firefox, ultracheap smartphones' failure reaffirm a very important
consumer behavior insight - price conscious they may be, but Indians don't like
to upgrade into a new product category via a brand that signals "cheap". As bra
nd consultant Harish Bijoor puts it: "Low cost is politically correct way of cal
ling something cheap but people see through it."
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