The Business of Banning Phones!

India is repeatedly hitting headlines worldwide, not because of Black Money or the Mangalyaan, but because of the ban brought onto some of the Chinese smartphones and their vendors. The first vendor which was recently banned is Xiaomi, which made a place in Top 5 smartphone makers in the world based on the sales in Q3 of 2014. While the second victim was OnePlus, the renowned maker of the Flagship Killer 'One'.

Reasons for the ban on both are different, but intention seems to be the same. Xiaomi entered Indian market in July 2014 and in not less than five months, Xiaomi churned the whole market, surprised the users and stunned every Indian smartphone manufacturer with its grand success. Though the company was limited to pre-registrations and flash sales, the available numbers were vanishing in seconds, even faster than that in China. Indian smartphone market unlike the global market is ruled mostly by native smartphone vendors. Most vendors import phones designed, researched, manufactured and assembled in China. The damage Xiaomi caused to these vendors was irreparable and allowing another such brand, OnePlus could do nothing but simply threaten their own existence. But market economy system wasn't been on Laissez-faire mode and OnePlus did land on Indian shores. The storm was intensifying, again. 

Xiaomi was doing its business buttery smooth with its flash sales on Flipkart and recently launched another Value for Money smartphone Redmi Note with 3G as well as 4G support, that too at an astonishing price. The sellers again started to shiver. But they took a sigh of relief when Ericsson filed a case against Xiaomi in Delhi High Court for patent infringement. The ban initially caused Xiaomi to import, advertise and sell its smartphones in India till February 5, 2015. The ban however was reconsidered later and Xiaomi then allowed to import only Qualcomm powered smartphones in India, that too only for a stipulated time.  Smartphones in Indian market are mostly powered by MediaTek chipsets and one could easily imagine who must have been benefited the most with the ban on MediaTek based smartphones from the house of Xiaomi. We don't want to dissect over who is behind the ban but intention is pretty clear.

On the other hand, OnePlus One is a ravishing smartphone with top of the line specifications and a great value for money preposition. Whereas Cyanogen, Inc. is the company formed by technology enthusiasts and developers, known for a very popular Android Custom ROM, Cyanogenmod. Both the companies spent delightful seasons together but soon after the recent tie-up of Cyanogen with Indian smartphone manufacturer and one of the leaders in India, Micromax, the relationship with OnePlus went sour. On one hand, OnePlus was peacefully selling One in India, Cyanogen was mostly confused about which side they actually are. Finally calling an end to the rumors, Cyanogen officially declared their non-cooperation to OnePlus and chose Micromax as their shelter in India. Soon after the picture got clear, OnePlus faced a temporary ban in India on selling its products because of the Cyanogen logo on One's back. Micromax launched Yureka, its first Cyanogenmod running smartphone at a phenomenal price tag. Though the ban on OnePlus One is temporary, but it is ultimately beneficial to Micromax and other Indian smartphone brands to push their products.

Banning smartphones or products with a legal aid is not bad when it is in the purview of business, profits and loss. But when it comes to the competition, it should be fair and clear. Just because a company cannot offer great products at ground breaking price, it should not be on a spree to create barriers to the ones who could offer all those. Price is a crucial factor but that does not decide the market dynamics. What actually decides is a quality product. This business of banning is not new but if you couldn't survive the competition, you should better be off the market.