MUMBAI, Feb 18 (Reuters) - Indian phone maker Ringing Bells launched a $4 smartphone on Thursday, with huge customer demand promptly crashing the little-known company's website hours after the phone went on sale.
The Freedom 251 was unveiled a day ahead of the launch and is being sold for 251 rupees ($3.66) - a price that skeptics said was far lower than what its components would cost.
The smartphone went on sale in the morning but the company later stopped accepting orders after its website crashed. "We humbly submit that we are therefore taking a pause," it said in an apology to customers.
Ringing Bells, based in the Delhi satellite city of Noida, was set up only last year and the launch event for the new phone on Wednesday night was attended by a senior leader from Prime Minister Narendra Modi's party.
Company president Ashok Kumar Chadha said the Android smartphone would have pre-installed apps that tie into Modi initiatives such as 'Make in India' and 'Clean India'.
"Let us see what can we do to bring about a real liberation of Freedom to all our brothers and sisters," he said in a speech, referring to the name of the new phone to make a play on words.
In its notice to customers the company said it was receiving 600,000 hits per second on its website, although it did not say how many of those hits converted to real orders.
For comparison, Google processes an estimated 40,000 search requests per second.
India is Asia's fastest growing smartphone market with 103.6 million smartphones sold in 2015. Most Indians still buy cheap smartphones that cost less than $200.
Related: The evolution of cell phones into smartphones:
Evolution of cell phones, smartphones
Indian company briefly sells $4 smartphone before website crashes
UNSPECIFIED - AUGUST 02: M2 Pocket Phone, manufactured by Excell Communications. Displayed with its headphones, leather protective case and user guide, the phone weighs approximately 0.75 kg. (Photo by SSPL/Getty Images)
UNSPECIFIED - AUGUST 02: Rabbit telepoint telephone by Hutchison Personal Communications Ltd, together with park and charge unit. Size of telephone is 400mm by 350mm by 100mm and weighs approximately 3kg. Rabbit was a British location-specific (Telepoint) telephone service backed by Hutchison, who later went on to create the Orange GSM mobile network. The Rabbit network was the best-known of four such services introduced in the 1980's, the others being Phonepoint, Mercury Callpoint and Zonephone. Although Hutchison had been issued a licence for Rabbit in 1989 it took until May 1992 before the service was launched. Telepoint services such as Rabbit allowed subscribers to carry specially designed (CT2) home phone handsets with them and make outgoing calls whenever they were within 100 metres of a Rabbit transmitter. (Photo by SSPL/Getty Images)
UNSPECIFIED - AUGUST 08: Mobile cellular telephone model M200 by Siemens AG, with one2one branding, less battery pack, 1991-2000 Dimensions: 190 by 65 by 35mm, weighing approximately 0.5kg. (Photo by SSPL/Getty Images)
UNSPECIFIED - AUGUST 02: Mobile cellular telephone, mobile Phone manufactured by Motorola, weighing approximately 0.75 kg. (Photo by SSPL/Getty Images)
UNSPECIFIED - AUGUST 02: The Vodac, by Vodaphone was produced between 1991-2000 and weighed approximately 0.5 kg. (Photo by SSPL/Getty Images)
UNSPECIFIED - AUGUST 08: Mobile cellular telephone model CM-H333 by Sony sitting in its charging stand. Dimensions: 185 by 55 by 70mm and weighing approximately 0.5 kg (Photo by SSPL/Getty Images)
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UNITED KINGDOM - JUNE 20: Taking mobile phones apart by hand and sorting the pieces for recycling is expensive. This phone was designed by Joseph Chiodo, a researcher at Brunel University in Surrey, to 'recycle' itself. It is made from special metals and plastics which have 'memories' of their original shape. When heated up, they lose their current form and revert to the shape they remember: different parts are triggered to change shape at different temperatures. The phone then ï¿½popsï¿½ apart, ready for recycling. Pieces can be picked out for reuse and the parts containing toxins can be separated. (Photo by SSPL/Getty Images)
JAPAN - FEBRUARY 15: Launched on the 1st September 2000, the Nokia 3310 featured advanced messaging, personalisation with Xpress-on covers and screensavers, vibra feature, time management functions, voice dialling, picture messaging, predictive text input and games. It also introduced ï¿½mobile chatï¿½ using the Nokia Friends-Talk service, which allows users to have conversations using SMS (Short Message Service). This is a globally accepted wireless service that enables the transmission of messages between mobile users and external systems such as e-mail, paging, and voice-mail. (Photo by SSPL/Getty Images)
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CANNES, FRANCE: Shown is Sendo International's Z100 multimedia smartphone at a news conference during the GSM World Congress in Cannes, France February 21, 2001. The Z100 phone features a color screen and runs on the Microsoft smartphone platform. The phone also features Microsoft's Mobile Explorer for the Internet, Mobile Outlook, a Windows Media player and USB connectivity. The phone will be on the market in the autumn of 2001. AFP PHOTO/JEFF CHRISTENSEN (Photo credit should read JEFF CHRISTENSEN/AFP/Getty Images)
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CellphoneCamera-Sept. 20, 2005-Photo Illustration of cell phone camera use. As camera phones grow more common, expect to see more incidents such as the man facing mischief and harassment charges after a suspect was caught taking lewd photos of little girls in a Toronto grocery store. Already there is a term for such behaviour: 'upskirting' and 'downblousing,' (pictures being taken down womens tops) and web sites devoted to the practice. (Photo by Tannis Toohey/Toronto Star via Getty Images)
LONDON, ENGLAND - JULY 06: In this photo illustration the Twitter website is displayed on a mobile phone on July 6, 2009 in London. The social network site started in 2006 in California as a sideline project, but has grown into a global brand becoming one of the fastest growing phenomenas of the Internet. (Photo Illustration by Dan Kitwood/Getty Images)
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(GERMANY OUT) several mobile phones on advertising folders - 01.11.2008 (Photo by wolterfoto/ullstein bild via Getty Images)
SPAIN - DECEMBER 02: A consumer holds Nokia's new handset the N97, during the Nokia World 08 event in Barcelona, Spain, on Tuesday, Dec. 2, 2008. Nokia Oyj, the world?s biggest maker of mobile phones, unveiled a new handset featuring a touch screen and full keyboard to challenge Apple Inc.?s iPhone and Research In Motion Ltd.?s BlackBerry devices. (Photo by Xabier Mikel Laburu/Bloomberg via Getty Images)
Israeli people wait to purchase the new iPhone 3Gs at an Apple store on December 9, 2009 in Tel Aviv, Israel. Hundreds of people lined up at the Apple Store in Tel Aviv to be the first to purchase Apple's new iPhone 3Gs which is faster than the previous iPhone 3G and has several new features. AFP PHOTO / JACK GUEZ (Photo credit should read JACK GUEZ/AFP/Getty Images)
Vertu Ascent mobile handsets are seen after assembly at Nokia Oyj's Vertu luxury phone division in Church Crookham, U.K., on Monday, Sept. 12, 2011. Vertu, started by Nokia Oyj's then-chief designer Frank Nuovo in 1998, has sold more than 300,000 phones in the last decade and seen 'high double-digit sales growth' since the start of 2010, President Perry Oosting said. Photographer: Matthew Lloyd/Bloomberg via Getty Images
PARIS, FRANCE - DECEMBER 07: A Windows phone 7 mobile phone sits on display at LeWeb Paris 2011 at Le 104 on December 7, 2011 in Paris, France. Since beginning in 2008, LeWeb Paris 2011 is the largest technology conference in Europe where Silicon Valley entrepreneurs and the tech world gather while often announcing new products. (Photo by Antoine Antoniol/Getty Images)
An Apple Inc. iPhone 5C smartphone sits on display inside the Orange SA store in Toulouse, France, on Wednesday, Nov. 20, 2013. France's gross domestic product fell 0.1 percent in the three months through September, national statistics office Insee said in an e-mailed statement. Photographer: Balint Porneczi/Bloomberg via Getty Images
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Although the company didn't discuss the economics behind the operation, analysts questioned the business model.
"It looks like it's highly subsidized by the company and it's not clear how they plan to sustain this," said Tarun Pathak an analyst with Counterpoint Technology Research.
Previous attempts at frugal engineering in India have not been very successful.
In 2008, Indian government announced a $10 laptop that ended up costing over $100 before it made it to market. A $20 Android tablet sold by local company Datawind through a government subsidy scheme failed to capture significant market share.
First deliveries of the Freedom 251 phone are not expected before the middle of the year, according to Ringing Bells. (Editing by Douglas Busvine and Simon Cameron-Moore)