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With mobile makers upping prices to fight the financial crisis, this isn't the best time to buy a new phone. We tell you the before-after story
If you didn't buy a handset pre Diwali, you will have to shell out more if you do it now. Mobile selling firms are revamping their price lists and the new trend is certainly not pocket friendly. Though the rise has not shot up too high yet, the future could hold more bad news.
>> New prices
Nokia has always banked upon their pricing and basic utilities for the domestic market. That's the reason why this giant leads the handset sales figures in the country. But now that the biggie has raised its sales tags, their success story faces a threat from other non-reacting brands. The recently introduced change at the dealers' end of Nokia varies between five to 14 per cent for the models mentioned in the box, after retailers keep aside a 15-20 per cent margin for a handset, depending upon its profile. For instance, the retailer price of Nokia 1200 is Rs 1519 while the new dealer price is 1272. Considering this, any retailer will earn close to 20-24 per cent on the old figures. Another company that has made modifications in the price quotes is Motorola. For the models mentioned below, an eight per cent rise can be mapped on an average.
>> Why the increase
The swelling in price tags can be majorly attributed to the increasing value of dollar because most of the companies import the handsets from abroad, and the billing is done in dollars. For a long time, the rupee was extremely strong , but with the economy in reverse gear, the dollar has regained its lost sheen. "I have never seen mobile prices going up. It's for the first time that I have seen an increase. The dollar appreciation has hit the industry hard and prices were bound to increase, its just that we were waiting for Diwali to get over," says Kunal Ahuja, CEO, Spice Telecom.
>> The after effect
The domestic market is price driven and any increase in the pricing would naturally create a dent in the sales revenue of mobile manufacturers. Entry level consumers are the worst hit, since they make the most price sensitive segment. "It was a tough task for us to achieve our sales target even when the prices had not increased. With the new pricing, the sales will certainly see a dip," lamented a Motorola sales executive on the condition of anonymity. However, mobile manufacturers need not worry about high-end mobile users, because they always have that 'extra dough' to shell out.
>> Will others follow?
"While we have already increased the prices for few models, we will soon do that for other models, too." says Kunal. However, Samsung still is holding onto its earlier price tags. "While most of the companies have increased the prices, we are still not planning any such step," said Ruchika Batra, general manager, corporate communications, Samsung India Electronics. Whether or not the others follow suit, it'd be wise on your part to hold your horses if you were about to step out to buy a phone. Samjhe?
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