RCom to launch cheapest smartphone

In yet another predatory pricing move, Reliance Communications (RCom) is launching the cheapest business phone in the country priced around Rs 10,000 to take on existing leaders such as BlackBerry and Nokia.

At present, the cheapest business phone (with personal digital assistants) is priced at Rs 15,000, while high-end phones are available around Rs 13,000.

RCom has completed beta testing and is gearing up for a commercial launch by the next month-end under its own brand. AnyDay, a US-based technology and design firm, has developed the phone for the company, sources close to the development said. The phone will be manufactured in China.

RCom’s smartphone will have internet capabilities, push-mail services (like BlackBerry), Microsoft Office (mobile edition) and PDA functionalities (like address book and appointment reminders). The phone also sports a QWERTY keyboard and has 3G capabilities, but does not have a camera.

An RCom spokesperson said the firm was constantly looking at contributing to the growth of tele-density in the country and has undertaken a number of initiatives to make devices and tariffs more affordable. He, however, declined to comment on the company’s business phone initiatives.

At present, there are more than 300 million mobile connections in the country, of which the business phone segment stands at a meagre 3 per cent. Industry analysts are of opinion that this segment is "growing fast" and with 3G services expected to be launched by January 2009, revenues from operators would mainly come from high-end (data) phone users.

A late entrant into the telecom space, RCom has always undercut prices to gain immediate access and market share. For example, the company launched Monsoon Hungama in 2003, under which it provided a mobile phone for Rs 501 at a time when the minimum price of a handset was Rs 5,000.

It unveiled the cheapest phone at Rs 777 in January this year (at present Spice Mobile sells the cheapest handset at Rs 599) and will soon launch an internet-ready phone for Rs 480.