Government Loses Revenue Because of Second Hand Mobile Market
The mobile phone user refuses to throw away second hand mobiles and prefers to pass it on to a new low-end user, thus helping the second hand market to grow. Second hand mobile market is growing so rapidly that price difference between the new cellphone and the second hand mobile market has been around 28% for the past few years. This price difference used to be 40% in the past and the gap is getting narrowed. In the developing countries, the grey market has got about 70% of the market share in the cellphone handset market.
Cell phone companies are worried that people will not junk their mobiles but pass it on to a second hand mobile user, who in turn will junk them in the flea market from where instruments make their way to the hinterland. On the other hand, it is common in South-East Asia to find five or six retired instruments in every office goer’s cabinet. There are many small towns where these second hand mobiles’ instruments find their way at a very low price.
People who go for buying second hand mobiles are not bothered about the features the set provides. They want to remain happy only with the basic purpose of remaining connected. Most people, while buying the handset, are not bothered to read the manuals. This results in many customers end up not knowing how to use the handset, so that it gets a longer life. The worst affected in this case is the battery. Batteries wear out faster because of wrong usage, thus giving more opportunity for business to the cellular phone companies. A typical NiMH battery has a life of 350 to 400 charging cycles, however short or long the recharging time. However, customers charge their mobiles even if it is only 10 per cent short of full-charge, exhausting their battery cycles.
What Helps the Second Hand Mobiles to Grow?
There was some sort of happiness seen when there were some initiatives on the part of the Government to bring a legislation that the mobile phone users will have to show their proof of purchase. But that dream remained a distant reality. Because of this immensely popular gray market, the government is also loosing huge revenue.
Some big operators sell second hand mobiles through their website. They also offer a package of services which includes six months warranty. Customer will love to have a warranty on second hand mobiles, thus helping the gray market to grow more.