Is It ‘Game Over’ for Freedom 251 Smartphones?

by CXOtoday News Desk    Dec 29, 2016

freedom

Here’s another twist to what was once claimed to be world’s cheapest smartphone at Rs 251. In a recent revelation, Mohit Goel, the managing director of Ringing Bells, has quit. His wife Dharna Goel, the director of the company, has resigned from her post too. The company’s sector 62 office in Noida has been shut for over two weeks now, said an ET BrandEquity report.

Ringing Bells’ Freedom 251 smartphone was launched in February 2016 with the promise of delivering nearly 200,000 handsets. By some, this is tagged as the biggest tech debacle of 2016. [Read the full report here]

The Delhi court recently summoned the owners of Ringing Bells for a cheque bounce case filed a private firm, Aryan Infratech Pvt Ltd. The former has issued a cheque worth Rs 2 crore which bounced due to ‘insufficient funds’.

The Freedom 251 smartphonewas initially offered for sale in India at a promotional price of Rs 251 which the company said will be offered at a regular price of about Rs.500 later.

The company announced that it has delivered 5,000 Freedom 251 smartphones in July and would deliver 65,000 more to those who had booked the device in cash on delivery (COD) mode. However, no contact details have been shared after this.

Recently, there were reports of another start-up- MDM Electronics being established by Mohit Goel. The venture MDM Electronics was reportedly incorporated on December 7 with a share capital of Rs 25 lakh and paid up capital of Rs 20 lakh. The company has its registered office at Kailash Colony, New Delhi.

The prototype showed and handed out to the technology media at the time of launch were relabeled Adcom devices, for which Adcom warned to sue Ringing Bells. But units circulated later were totally different from original.

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Doubts were initially raised over Ringing Bells’ handset after some experts said no smartphone could be manufactured for less than Rs 2,000. Some observers said that the Freedom 251 sale is a scam. The phone looked like a Chinese phone where the original brand label was covered. The icons shown on screen shots were copied from iPhone. There is also news that a lot people who booked the phone did not even get a confirmation.

Ringing Bell vowed that they would refund the full money to 30,000 customers who pre-booked the Freedom 251 on the first day of the sale. The company said that the refund would reach people during the first week of March 2016.

Now taking all these into account, should government set stricter rules to curb such frauds? May be by imposing stricter controls over business propositions like Freedom 251 could lead to disturbing budding start-up environment. Of course, we can expect to see some preliminary intrusion to check the business practicality of such propositions, especially if it has potential to affect people at large.