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India has already built the world's cheapest car – the £1,250 Tata Nano – now the country has unveiled the telecoms equivalent: the £10 "people's phone".
The mobile handset, developed by Spice, the Indian telecoms group that is listed in Bombay and worth £1 billion, is angled at the very lowest end of the market.
This means the phone has jettisoned all "non-essential" features – such as a screen. "It is just a phone," said Bhupendra Kumar Modi, the Spice chairman, who hopes to sell about 10 million in the next year.
Mobile phones priced under about £20 account for only about a fifth of the global market.
However, with half the world's population yet to make a phone call and Western markets becoming saturated, there are more mobiles than people in the UK, companies see massive potential in budget devices aimed at the developing world.
The telecoms industry expects the number of people owning a mobile phone to grow from 3 billion to at least 4 billion over the next three years.
With the "people's phone", Spice is joining the race to sell handsets to the up-and-coming new generation of Asian, African and South American consumers dubbed "the next billion".
The company will begin selling its people's phone in Asian markets from next month. Spice has already suggested prices can be stripped down further and that a £5 mobile is not far away.
Cheap products from India are already making waves around the globe, though British shoppers are likely to have to wait to feel the ripples.
Since the Nano, the world's cheapest automobile, was unveiled last month, its manufacturer, Tata, has been inundated with queries from non-Indians asking whether they can buy "the people's car".
The 33bhp two-cylinder vehicle is priced at 1 lakh (or 100,000 rupees, about 1,250 pounds), excluding taxes. The base model will cost about 130,000 rupees on the road - a sum that would buy a stereo system for a BMW.
Tata says it will export the Nano to the UK and other overseas markets eventually – but not for about three years.
Meanwhile, India, the world's fastest-growing market for mobile phones is a prime target for mobile manufacturers.
It is estimated that more than 870 million of India's 1.1 billion population are yet to own a phone. Mobile subscribers in the country are expected to more than double in the next three years, to 500 million.
The remainder of the "next billion" are not being overlooked. Nokia, the world's largest manufacturer, is experimenting with cheap handsets that can be used for mobile banking in Africa. Motorola, its American rival, has showed off a bicycle-powered device, which it suggested could sell well in China.
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Surprised why only people from US and UK are there to respond. Indian companies are doing for their people, be it cheap car or a cheap mobile or cheap services. Atleast in India, you dont need to pay for drinking water or to watch television.
Les, Tokyo,
What happens today and tommorow is more important than what happened in previous generation.
Freedom of movement is the destiny with business, trade and relationsships. The reason inheritence tax law is in place concerns distribution of wealth.
How do we distribute wealth globally to make progress with respect to increasing the telephony technology to people who have never made a telephone call in our world.
Education of not being selfish amongst rich is a good start.
Sidhararth Mahay, Handsworth Wood, uk
I can't understand why we in the UK feel compelled to respond to such useless piece of news. India was for the last 5000 years, the richest country in the world. Europeans , specially the UK became so rich by leaching riches off India for nearly 150 years. Inspite of that UK has been richer than India for only 60 years in total. It is trade that made UK and Europeans rich. It was innovation that made them rich. It was creating jobs and skills that made people rich. If not all, then most of new acquisitions of international companies are coming from India to UK / G7, than the other way. Wake up, Japanese were criticised for their cars, then Koreans for their electronics, now Indian's for their cheap phones and cars. I don't want to predict things, but people who do something are the only ones who get any where. With record investments n largest pool of talent, the future looks a lot different to how we in europe are used to of expecting things to turn out!
SK, London,
It reveals again we live in rip off Britain.
JANE , whittlesey, cambs
I thought the idea was that we were going to sit tight in Britain and invent things and be creative while all the thick people of the world who can't invent things make them in factories. Is there a flaw in our economic model?
John Ledbury, Kings Lynn, England
So where are the manufatures going to send all our old phones to
We need India to take all are old phones,, so we can have cheap deals
Nicholas Iles, Oswestry, United Kingdom
Does it matter how much your cell phone costs? No the point of this article isnt to brag about how cheap Indians are selling cell phones. It is to show a new market, a new style of production, and a new billion people that will see somewhat modern technology for the first time... Jeez
Ben, America, California
OK 3 points...
1. A phone that has "jettisoned all non-essential features" has a 2gb memory and an mp3 player? Yes that is a basic phone *rolls eyes*
2. Has anyone thought of the charges when USING the phone? The phone might be worth only GBP 10 (that is almost USD 20 for people who have no idea of currency rates like Denis in Burlington!) but I bet the networks will still charge silly even in India.
3. Most important point though is the waste! Stop making cheap new mobiles, just recycle the old ones. People in the west change phones regularly so why not sell them for 1 or 2 pounds each and anyone can buy it fora fiver. Do we really need more cheap electronics made in South East Asia!
Alex K, Manchester, UK
I agree. This, in no terms, is revolutionary.
I bought the Nokia 1110 ultra-basic phone from Virgin UK, in Leicester, for GBP 20. It had GBP 10 worth of talk time included in it, and that too way back in 2003.
It is still my primary phone having outlasted a Sony Ericcson T10, Nokia n70 and a Samsung E220.
I was looking out to buy enough of them last year so that I'd have enough stock to last till senility took away my ability to hear and see. Possibly the Nokia guys realised the indestructibility the 1110 as well, and had it replaced by a more âdestructibleâ model.
srinivas kommireddy, hyderabad, india
Last year I bought a non-contract phone for £15 from Asda.
Wages in India are about 1/8th of those in the UK for equal jobs.
We are so lucky people in India and China are prepared to work so hard just so they can stack up piles of our currency, they seem oblivious to the fact we are deliberately deflating our currency as they do so.
Mark, Epping, Essex
Since this new cheap phone comes without a screen, I suppose SMS is out of the question .... how do the cellular operators see this I wonder, since SMS is one of their main revenue generators.
Chanaka, Peniche, Portugal
this isn't that revolutionary when I was India this time last January I purchased a phone for £15.
Eustace, London,
This is a good idea
Randy Welsh
Randy Welsh, Madison, AB
Wow, this is old news. My wife's cell phone broke and I was able to go to my local Wal-Mart, and buy a new Motorola phone (with color screen, etc) for $18.95 USD.
And I bet it had better features and capability than the phone mentioned in this article.
John, Chicago, IL, USA
Everyone is missing on the real point. The phone also comes with 2 GB memory to store MP3 songs. The 2GB memory card costs 5 to 8 pounds in UK. Now decide for yourself which is the cheapest phone :)
shiva, edinburgh, UK
I think a cellphone without a screen sounds like a great idea!
Jared, , Lyndonville, VT
Anyone can buy a basic working phone for £2.50 (+ £1.50 postage) on ebay. Now try beating that.
mohammed, london, uk
when I buy a phone, all i want is a phone. i hate these new phones with all the gagits. i don't know how to work them but i find that i must pay for them. a$10 phone that is just a phone is worth a lot more than $10 to me.
brian lashmar, hamilton, canada
I agree that cheap cars and cheap phones are a good thing, however my biggest concern regards waste generation. When these cheap cars break down hey will probably be maintained for a length of time, but what about these phones? Will an influx of 5 million phones hit the landfills?
spud, Youngsville,
We have a wide variety of fones, with screens and evrything for 15 - 20 dollars US. (and no contracts) What's that like 2 Euros? Why is this news?
Denis, Burlington, VT, USA
Mrs H,
when you buy a $20 Virgin Mobile phone, you are tied to virgin. You can't use this phone with other mobile operators like t-Mobile or AT&T. Also you have contract with Virgin Mobile (in case of postpaid connections). The $20 phone developed by Indian company is not tied to mobile operator & customer can buy the phone over the shelf & use it with the provider of his/her choice. There are no contracts either. You missed this point.
Ashish , Lexington, KY, US
To someone who said their phone is free:
The cost of the phone is embedded in the amount of money that is charged during the 2 year period.
Nick, Atlanta, USA/GA
Some people donât get it. Not only India offers cheapest phone, it has cheapest service 2C/min.
You phone may be free in US but you pay 75$/month for the service for 2 years. Right?
Pet, NJ, NJ
Spice should be applauded for taking the initative on this matter and singlehandedly taking the mobile phone market to every single member of the community.
But is it really the right way of doing it? As a individual consumer in the UK, I can easily purchase a basic Nokia Handest with a £10 airtime voucher from a highstreet retailer for £15. Sure, it could very well be a "loss leader" type item that is an attempt to lock me into the network.
The premise however is simple, would it not have been easier to simply have signed a bulk purchase contract with Nokia/SonyEricsson/Motorola for one of their basic handsets, that could then be billed as the people's phone and sold for £10, delivering improved functionality and ease of use?
It's a moot point however, I'm sure, as a mobile phone of any standing will be welcomed by these members of our community.
Now, if only the same principle could be applied to clean, running water, we really would be getting somewhere...
Hassan Azam, Banbury , Oxfordshire, England
I can buy a $20 Virgin Mobile cell phone any day of the week at any "big box" store in the U.S. (Target, Wal-Mart, K-Mart, Best Buy, etc.) And my Virgin Mobile phone has a readable screen, and all the capabilities I want (I don't need a camera or access to the Internet -- I just want a phone). So what's the big deal? Aside from more jobs movine to SE Asia?
Mrs.H, Dallas, Texas, USA
Would be great to stash away in the car for emergencies. Or give to your mom who probably won't use it anyway.
Justa Thought, Evansville, USA
I live in Guatemala and we get our brand new Motorola cell phones for US$13.50-20 with about two hours of airtime included and usually a free hat, jacket, backpack, or umbrella included. Service providers are Tigo, Claro, and Moviestar.
Mark, Quetzaltenango, Guatemala
Its all good buying a cheap mobile but what happens when theres a problem with the phone or the network. Will a person need to ring a call centre in india and if so will this service be free?
kasim, bury,
So? Whats the big deal..
FOLKS, All your electronics are THE SAME.. India can "make" a 10L phone because that is all people there will pay..
YOU are the ones paying hundreds for a few dollars of electronics...
Besides my phone is "FREE" *
* with a 2 year contract.
American, Orlando, US