The Almighty Cellphone - Part II

Last week, TechPov discussed the opportunities for poverty alleviation for the masses in the form of cell-phone proliferation. Arguments for cell-phones included efficiency gains as well as tangible and direct increases in income due to cell-phone utility. Today, we look at an actual product which has clearly been targeted towards these 'untapped' poor and rural markets.

Spice Communications Ltd., a telecommunications firm based out of India, last month unveiled their 'People's Phone,' (see image below) a no frills mobile handset (no display, no flip, no features) priced at less than $20 USD. This low-price tag is an extreme innovation, with no other major mobile makers ever having set such a price, making it the world's cheapest cellphone (see below for more details).

In an article in the International Herald Tribune (where this picture is sourced), Spice Mobile President Paul Shoker and article author Victoria Shannon explain why such a product is likely to be extremely successful.

"There is a massive need for these phones," said Shoker, "We are targeting an area from Iraq to Indonesia, and that area has a population of 2.5 billion." India alone could keep the company in rupees. With more than 7 million handsets sold each month, the country accounts for more mobile phone sales than any other. Combine that with the fact that only 17 percent of the population now uses a mobile phone, and the potential is huge, analysts agree.

Spice Mobile is looking to sell 10 million phones in its first year. Currently, there are approximately 1 million orders out on the People's Phone; however, the company says that there is interest from Mexico, Africa, and Indonesia.

As one would expect (and as we found out in our last entry about Nokia), several other big mobile companies are also keeping their eye on the emerging markets piece. Shannon's article mentions the Korean brands LG Electronics and Samsung as others that are quickly moving in the 'low end' market as well. As far as already established models, Nokia's cheapest is approximately $45, and Vodafone offers models that are close to $25 (Corbett article in NYTimes Magazine). Nokia has several entry-level models, and among them is the Nokia 2135 as seen on the right - click the phone for more details.

Here again is a clear example of how the merging of technology and profit-oriented business can actually result in solutions or products that both empower the poor and keep the companies happy: Spice Mobile can now profitably sell this product to mass markets while millions of new customers can now afford a phone and the benefits that come with it (see past entry).

Related Links:
Check out this short Reuters Clip with Spice Mobile's Paul Shoker on YouTube
'A cellphone with no flips, no folds - just a very low price' - IHT Article