OnePlus may challenge smartphone sales ban in India


OnePlus may challenge smartphone sales ban in India
The OnePlus One is a considerable threat to the current Android elite, offering top-end performance for a very attractive price tag.
NEW DELHI: Chinese manufacturer OnePlus, which was
 banned by the Delhi high court on December 16 from selling its only smartphone model 'One' in India, plans to appeal against the order.

The court order did not come as a shock to OnePlus which had been negotiating with Cyanogen even as it fought the case slapped by Indian rival Micromax in the high court.

In fact, OnePlus was aware that such a situation may crop up once it launches the One smartphone in India. The company sells only the CyanogenMod-powered One smartphone globally.

OnePlus was aware that such a situation may crop up once it launches One smartphone in India.

The court order states that OnePlus went ahead with the launch of its CyanogenMod-powered smartphone despite knowing that Micromax had entered into an agreement with Cyanogen on September 26. Cyanogen is a US-based company that makes a popular custom version of Android software.

In fact, Micromax had intimated OnePlus about the exclusive deal it has with Cyanogen much before the December 2 launch of OnePlus One in India. Upon the request of the Indian smartphone brand, Cyanogen too had informed OnePlus of the exclusive agreement it had entered with Micromax, states the order.

On November 26, OnePlus contacted Micromax about using Cyanogen's software on its phone in India. In response, Micromax sent a legal notice to the Chinese company on the matter. Cyanogen too informed OnePlus about terminating the relationship and requested OnePlus to stop using its brand name for marketing in India.

After repeated requests from OnePlus, Cyanogen agreed to provide OTA support to OnePlus One in India, but only for the month of December, 2014.

However, Cyanogen issued a press release on November 27 stating that their operating system will exclusively support Micromax's mobile devices in India and will not support any other devices, including OnePlus One, shipped in India with future updates.

Micromax, which foiled the Chinese firm's launch plans, had submitted to the court that it would "suffer irreparable harm and loss if the defendants (OnePlus) are permitted to continue" in violation of the agreement between Micromax and Cyanogen.

In a statement to TOI Tech, OnePlus One said "in light of this (high court) decision, (we) are working to find a solution that will allow us to continue operations as soon as possible. We regret the inconvenience this causes to OnePlus fans in India who have patiently waited for the opportunity to purchase the One."

At an industry event in New Delhi, OnePlus's India general manager Vikas Agarwal also claimed that the company may go to court to "challenge" the ban.

TOI Tech was the first to break the story of OnePlus's launch plans in India as well as carry an exclusive review of the popular smartphone.

OnePlus One, which is known as a feature-rich smartphone at a very competitive price, has a non-exclusive agreement with Cyanogen to sell phones powered by the latter's software anywhere in the world, except Mainland China.

On the other hand, the contract later entered with Micromax makes the CyanogenMod software exclusive only to Micromax phones in India. A clause in the Micromax-Cyanogen contract ensures that this deal supersedes all other agreements Cyanogen has made previously which has dealt a big blow to OnePlus's India launch plans.

The company says it has already sold "tens of thousands" OnePlus One units in India. Data by import tracking website Zauba shows that 20,000 units of the smartphone have been brought into the country so far. It is not yet clear if the entire stock has been sold out. The phone is currently unavailable on Amazon.in, which is the exclusive retailer of OnePlus phones in India.

Interestingly, OnePlus too has filed a counter lawsuit [CS (OS) No. 3688 of 2014] against Micromax in order to counter the launch of Micromax's CyanogenMod-powered Yu range of smartphones in India on December 20.

However, OnePlus has not requested the court that global agreement with Cyanogen be applied in India too, merely that the Micromax launch be put off until the matter is sorted out.

Emails exchanged between Carl Pie of OnePlus and Cyanogen's Kirt McMaster too show that the latter had expressly asked OnePlus to remove the Cyanogen brand name from all marketing material and that it will be terminating its relationship with OnePlus (in India).

However, OnePlus went ahead with the launch regardless, perhaps in the hope that the sub-judice matter will get prolonged, giving it the window to migrate newer phones to its own custom version of Android.

In an email to Pei, McMaster also wrote, "I'd like to reach a compromise here. Ship stock Android in India. No mention of Cyanogen in India and I will keep supporting OnePlus for rest of world. And we can continue dialogue for other devices etc."

OnePlus has taken no legal action against Cyanogen for any breach of contract. As per the court order, the company is not allowed to sell CyanogenMod-powered smartphones in India anymore, but can still clear its current stock.

OnePlus had recently said that it will be able to sell phones powered by its own operating system in February only.

OnePlus One smartphone is widely regarded among tech enthusiasts and journalists as one of the best smartphones available in the market right now. The company had earlier stated that OnePlus One sales had crossed 5,00,000 units globally by mid-October and that it expects India to become its biggest market in the next few months.

OnePlus is the second Chinese smartphone brand to be barred from selling smartphones in India. Last week, Delhi high court had banned Xiaomi from selling and importing its smartphones in the country till February 5, 2015 due to a patent dispute with Ericsson. However, the company was granted a reprieve by the court on December 16 by partially lifting the ban. However, that case pertains to patents of Ericsson which has sued not only Xiaomi, but also Micromax, Intex and Gionee, citing violations.

Chinese smartphone makers like Xiaomi, Oppo, OnePlus and Huawei have become very aggressive in India in the past one year, spurred largely by online retail that enables them to pass on the margins saved by not going through the established offline reseller chain. It has upset the applecart of many a big brand present in the market, affecting their sales.

Both Xiaomi and Motorola have given market leader Samsung a run for its money. The two have changed the market landscape, bringing down costs of quality smartphones. The trend is likely to intensify in 2015.

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