Vodafone to bring handset at Rs 700

MUMBAI: The race to provide ultra low-cost mobile handsets to consumers in India has moved to the next level, with telecom service providers competing with mobile handset makers to offer models below Rs 1,000. Leading the way is Vodafone , which is set to launch its Rs 700 ($16) mobile phone in the country. The handset is expected to push the company's rural agenda.

Even as mobile phone makers like Nokia, Micromax , Fly and Ray are retailing handsets at alluring prices, this is the first time that a telecom service provider has decided to go below the Rs 1,000-mark . Earlier, Nokia retailed a phone at Rs 1,300, and Vodafone had a mobile priced at Rs 1,200. Besides India, the British operator is also set to unveil a pair of ultracheap handsets starting at below $16 in the developing markets of Egypt, Turkey and Africa.

Marten Pieters, MD and CEO, Vodafone Essar, said: ‘‘ The average user in rural India does not spend as much as mobile consumers in Delhi or in Mumbai. Though the majority still make a revenue stream for mobile operators, the idea is to make mobile phones affordable and achievable for everyone,'' he said.

The Rs 700-handset will be retailed across the country , and not just in rural areas , reducing the entry barrier for consumers who have not yet bought a cell phone. On Monday, Nokia launched a Rs 6,000-handset loaded with a full qwerty keypad, email service and access to social networking sites.