Indian company Ringing Bells is making waves in the tech industry with its latest product, the ridiculously cheap ‘Freedom 251’ smartphone priced at an unbelievable 251 rupees ($3.67).

Despite the phone’s low price, the company is promising a host of swanky features like 8GB storage, 8MP and 3.2MP primary and secondary cameras, pattern lock with face detection, 5-inch touch screen, 1080p video support, bluetooth, and of course, 3G support. “We will be the first Indian company to offer an incredible smartphone at a highly affordable price,” the Ringing Bells website states, adding that the phone will work on a “no-frills” platform that’s a “minimalistic and lightweight take on the Android 5.1 Lollipop operating system.”

According to a Ringing Bells spokesperson, the company believes that the phone – strongly resembling Apple’s iPhone 4 – will “bring a revolution” in the industry. While the initial promise was to price the phone under 500 rupees ($7.3), the actual cost was revealed at the launch event last Wednesday, creating a global stir. The high profile event conducted in Delhi was attended by members of the Indian Parliament and other state level leaders. The website went live for pre-orders the next day, but with 600,000 hits per second their website crashed within a few hours and they were forced to close bookings. The company later revealed that they received 37 million orders on Day 1 and 24.7 million on Day 2. They are now promising to deliver the devices to all their customers within four months.

Photo: BCCL/Gizmodo

“We are humbled and extremely grateful for your overwhelming response and trust,” they said, in a statement announcing the closing of pre-orders. “Respectfully, this is to advise that the response far exceeds the number that we had expected and therefore, we are now closing the invitation to bookings in this phase 1. We appreciate and acknowledge that we may not have been able to meet the needs of all, but will definitely look forward to serving you again in the next phase.”

Critics, of course, are highly skeptical of the company’s promises. Many of them argue that the cost of the components alone would be far higher than the promised retail price. That’s not including production, distribution, and marketing. The Indian Cellular Association has written to India’s telecom minister, Ravi Shankar Prasad, asking him to dig deeper into the matter and complaining that it is impossible to price a 3G phone below 2,700 rupees in India. The excise and income tax departments are also reportedly investigating the company’s finances.

Photo: TechPP

“It looks like it is highly subsidised by the company and it is not clear how they plan to sustain this,” said Tarun Pathak, an analyst at Counterpoint Technology Research.

According to Indian media outlet Hindustan Times, the controversial phone is riddled with problems. “When HT got its hands on a Freedom 251 unit, it had multiple problems,” their report stated. “The phone doesn’t look anything like Freedom 251’s photos on Ringing Bell’s website. The model we received looks closer to an iPhone, complete with a round home button. Most built-in app icons on the Freedom 251 are a direct copy of icons on Apple’s iPhone. Even the web browser is a rip-off of Apple’s Safari browser that only exists on iPhones, iPads, and the Mac.” The report further added that the unit they received had the brand name ‘Adcom’ emblazoned on the front, covered up with whitener. But when they contacted Adcom, a Delhi-based importer of IT devices, the company head denied having any knowledge of this.

Photo: TechPP

But Ringing Bells assures that the device sent out to the media was only a prototype. “In view of the shortage of time and given that these were to serve only as prototypes to a limited list of persons, we went ahead,” said company president Ashok Chaddha. “We would clearly mention that the final Freedom 251 manufactured/assembled in India would be to identical specs – i.e. no change.”

Ringing Bells also denied allegations that the Indian Government is subsidizing the Freedom 251, adding that they plan to import components from Taiwan and assemble the phones in India, thus getting duty waiver by state governments of around 20-30 percent. Selling the handhelds exclusively online will also bring down costs by an important margin, they claim.

Sources: BBC, India Times, Hindustan Times