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Business News/ Industry / Telecom/  Spice Mobility plans to invest Rs200 crore in India
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Spice Mobility plans to invest Rs200 crore in India

The company aims to increase its sales and distribution network and visibility in the country's smaller towns and cities

The company recently tied up with Mozilla Corp. to offer entry-level smartphone powered by Firefox OS at Rs2,300, which was launched on Friday.Premium
The company recently tied up with Mozilla Corp. to offer entry-level smartphone powered by Firefox OS at Rs2,300, which was launched on Friday.

New Delhi: Spice Mobility Ltd, a mobile internet devices company and part of Spice Retail Ltd, plans to invest Rs200 crore in the current financial year in India aiming to increase its sales and distribution network and visibility in the country’s smaller towns and cities following the launch of low-cost Firefox OS (operating system)-based smartphones.

The company recently tied up with Mozilla Corp. to offer entry-level smartphone powered by Firefox OS at Rs2,300, which was launched on Friday.

“The basic idea behind the alliance was to give consumers what they are looking for. There are 22 million handsets being sold in India every month, of which 70% market is for feature phones," said Prashant Bindal, chief executive, Spice Mobility Ltd. “We will be launching a series of version across the price points to meet the consumers’ expectation. As we understand the behaviour of customers, we would understand demand at a particular price point."

The company is focusing on increasing its sales network and visibility.

“We have augmented our internal sales force and distribution. Our idea is to become a key player in tier 2 and tier 3 towns in middle-income consumer base. So the price has to be under Rs10,000," said Bindal.

“We want to make our product available at the village-level and invest money in marketing to ensure the consumers are aware of our offerings. We have tripled our sales force, doubled our distribution this year. Overall we would be investing around Rs200 crore," he added.

The mobile device company will be launching its first lot of 20,000 units of these smartphones through Snapdeal.com next month.

“We believe this lot will sell very quickly. As soon as these are sold, we will do the research on if it has reached the consumers’ expectation level and what expectations they have for the next lot," he said adding that the company intends to reach a mark of million phones from this month onward.

“(In India) We are confident that ultra-low-cost Firefox OS devices will realize a whole new category of smartphones to bring the power of Web to more people," Li Gong, president of Mozilla Corp.

“It (success of the Firefox OS) will depend on combination of factors including marketing, pricing, promotion, user experience and word of mouth smartphone operating system is dominated by Android, which has more than 90% of the market," said Manasi Yadav, an analyst at research firm IHS Inc. “To cut into the market, it will take a while. It could be three to four years, but since the market is dynamic, if the product is nice, then it can happen earlier as well."

“It makes a lot of sense to launch it for a low cost product and put the money in research and development and then eventually move towards the higher end products. This is what Lumia did. They launched 510, 520 models first and then moved to the higher end product, but the (sales) volume still came from the low end products," she said.​

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Published: 29 Aug 2014, 11:17 PM IST
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