0		Reliance, launch, low-cost, smart, phone

Reliance Communications (ADAG) group will launch a low-cost smart phone. By low, we mean in the smart phone range. The price would be around 10000 rupees. US based technology firm AnyDay helped design the phone and the phone will be mass produced in China (where else). The phone is packed with all the PDA features like email, mobile office, keyboard and 3G service.  It does not have a camera though.

Smart phones both touch screen and keypad phones launched in the last 6 months were in 30000+ range. iPhone, Nokia N96, Samsung Innov8 and HTC Diamond were the popular ones. The problem with these phones is they are expensive for the cost-minded Indian consumer. Sensing this Nokia said they will launch a touch screen phone in the 20000 range. Motorola has already launched its GPS enabled touch screen phone which is in the 15000 range.

Reliance’s only strategy is ‘economies of scale’. It doesn’t matter which business it is in. It mass produces the goods and delivers it through the channels on a mass scale. It has been working for Reliance in the past and it will work in the future. No one can really compete with cash rich Reliance machine. This mass production severely undercuts the price and the competitors have no choice, except to follow or leave.

The phone will be launched at the end of next month or early 2009. It is not yet clear whether it would be GSM or CDMA. For Reliance customer’s it shouldn’t matter because they play both the games. (Source)