We recently caught up with Rahul Sharma, the man behind Yu which has launched the Yureka device in the market and is having a tough time keeping up with demand on Amazon India.Yu is a new brand in the Indian smartphone market. The company is a 100% subsidiary of Micromax, one of the most popular names in the sub-continent.We had a chance to talk to Rahul Sharma – the co-founder and the CEO of Yu about the company’s progress and of course we asked questions that would answer all your queries.
Yu with its first device, the Yureka has created a lot of buzz in the market and has been the talk of the town for what it has got to offer. It is one of the hot sellers at the moment and the limited stocks meant that many of you were left disappointed. In our talk, Rahul shares us the journey that led to the unveiling of brand Yu and spreads light about the product availability.
On with the interview..
FoneArena: First up, what does it take to buy a Yureka? We have been trying ourselves to buy one for the past couple of week with no luck!
Rahul: We completely under estimated the demand and we are ramping up the production every month. So, hopefully moving into the next month the supplies should easy up.
FoneArena: We were just wondering, when we can expect the device to be available more widely. I mean do you at any point in time see yourself selling the device through open sales?
Rahul: I don’t think it could be open sale, I don’t know. But, as of now the trend is we are increasing the supply so that more and more people can come back and buy the smartphone.
FoneArena: We know that Yu is a subsidiary of Micromax. Do you share any relationship beyond that? What’s the difference between Micromax and Yu as a brand? Why two companies?
Rahul: That’s the first question I am usually asked! The only connection or the common point between Micromax and Yu is ‘Rahul Sharma’. Apart from that Yu is completely a separate brand. It is a different team altogether and we even have different offices. So, there’s no real connection between Micromax and Yu other than legally.
We as a company believe in innovation and we question ourselves – why would people buy a smartphone? I call my sales team and I ask them why should people buy this phone? The point I’m trying to make is well you make product and you believe that it’s the best, but that’s true only if the consumers end up buying them.
The growth with Micromax is quite amazing, we are growing quarter on quarter and it’s been good so far. One day I was just thinking what’s next? And, I believe that the smartphone industry will be as good as the laptop industry in the next year or two.
Unfortunately, there’s no innovation in the laptop industry and that’s the case with the smartphone industry too. Except for bumping up the hardware specifications, there’s no real innovation and how long can you do that?
For me, the next revolution is coming from software and services. Not hardware. That’s what we are working on and we have realized that for us to do that we should first take control over the operating system. There were two options for us – one is to making a new ROM from scratch or partner with someone who has one of the best solutions across the world.
We valuated a lot of solutions, but found Cyanogen to be the best and it’s a fantastic product. So, we decided to go ahead with them. And, I call it ‘Android on Steroid’ because it provides so many sanities. We wanted to target tech natives and to address these people we had to come up with a new concept.
With Micromax you sell a phone, your job ends. But with Yu, you sell a phone, your job just starts. It’s more about services and we are working on a lot of them now. Going forward you will see a lot of services coming to Yu.
Another key difference – Micromax is a brick and mortar company, but Yu is into internet and services. You should see the design of our offices, we have ordered beds and it’s going to be a different culture altogether.
FoneArena: We know what you mean. Micromax had a different beginning and the market status at that time is totally different from what Yu has to face today. And, also you can’t change what Micromax is doing today. So, did this scenario contribute to starting a brand like Yu?
Rahul: About 85% of the market is still offline. For example, in United States if Amazon is there that doesn’t mean that Walmart is going to shut down. And, there’s a lot of business happening there.
In India, there will be space for both the online and offline brands. We are fortunate that we are already present in the offline market and with Yu we are strategically covering online as well.
FoneArena: How did you come up with the name Yu?
Rahul: Y stands you and U stands for us. It’s a brand for you from us and that’s how we came up with this whole idea of Yu. And, in Yu what are the variants we were going to have started with project Yureka and that’s how the smartphone got its name.
FoneArena: Is there any possibility to see Yureka sell in retail stores?
Rahul: No way. It’s always online. As I said, we are completely focus on tech natives, all those people who wants to customize their experience and all those people who want to empower them by the virtue of their mobile phones.
That’s why we say that if you want to root, go ahead and do so. We are not voiding their warranty. All these demonstrate that we want to back you guys.
FoneArena: Do you ever plan to sell the products all by yourself? I mean without any retail partners. And, why Amazon? Is it because Xiaomi is selling their products on Flipkart?
Rahul: We do not want to comment on the future, but for now we will be sticking to Amazon who has been a great partner to us. We had earlier enjoyed a great working relationship with Amazon before and we were experienced with Android One. We know that they did a great job with Android One because the sales were more than three times than what our competition has. So, we decided to go back to them.
FoneArena: Do we ever see a premium version of Yureka? Are you guys looking at any other categories other than smartphones?
Rahul: Thanks for the question. I would love to answer this. What do you need in a premium phone? We do not want it to lag, we want all operations to run smoothly and we want it to support multi-tasking. It should be future ready with 4G, 64-bit architecture chipset and run Android L.
Yu Yureka is already a premium version. It’s pricing doesn’t reflect that and people are wanting a premium version. However, we are going to come up with products that offer more features.
We are looking at other categories as well and wearable’s is something that would get our focus big time.
FoneArena: Is Yu one of the hardcore strategies from Micromax to take on its competition?
Rahul: I understand where you are coming from. People are thinking that way because of companies like Xiaomi coming in. But, to be very honest, the planning for Yu started like a year ago and we were just working on it.
The whole idea with Yu is provide a different set of services to the consumers and when I say services on Yu, we want come up with a new thing. For example, there’s no good music service in the country and there’s no native experience. So, we can simplify these things on our product. We believe that the experience has to be native and it has to be a part of the phone.
We have reached a stage where one will have his smartphone round the clock with them and I myself have stopped using laptops while travelling. The smartphone screens have gotten bigger and we have all sorts of functionalities here. It’s a movie is being released on a theatre, why not on phones? People will pay for that as well. This change is bound to happen and this is the experience we want to provide.
FoneArena: We know that you guys already have a factory in India. Do you plan to manufacturer your products in India and support ‘Make in India’ initiative?
Rahul: We are already manufacturing feature phones in India and we will eventually start producing smartphones in India as well.
We plan to manufacturer about half a million smartphones here, but we are not talking about it. But, you will pretty soon see Yureka being produced in India.
FoneArena: Yu Yureka is being sold at such a killer price tag. Do you see yourself making profits with such a price point? And, do you plan to go public?
Rahul: I am sorry. We generally do not share our company numbers. Yes, as and when we feel that the market’s right or may be when we feel like we need to raise money that’s when it might happen.
For now, I am glad things are going well. The market dynamics change pretty quickly in Indian conditions, but we are happy at where we are at this point in time.
FoneArena: You had previously said that Yu is designed to be a global brand. Do you have any timeline in mind for that or when can we see Yu entering other international markets?
Rahul: Right now, we are ramping our supplies and it’s evident. You can see people cheering us and also we are aware that there are still quite a few disappointed fans. The moment we are able to come in terms of demand in India, believe me we will enter other markets.
Yureka is a future ready product and it is second to none. It’s been quite some time since we started making phones and we know what works best. So, with our experience we will enter a new market when we feel that the time is right.
FoneArena: What’s your take on the stiff competition in Indian market?
Rahul: Every year there’s always competition. Indian market is always evolving. For example, Motorola wasn’t a bad company but they want out of business because they couldn’t come up with any product. So, as long as you can keep on innovating you’ll be in the game and the day you stop – people will throw you out for obvious reasons.
Nokia as an organization was a very beautiful story and I have deep regards for them. Back in the day, there design was excellent they innovated so much, but they went completely wrong on software. It’s sad!
So, what I am saying is competition is always there and in fact you need it drive you in the right path. You should always respect them and give them enough credit.
FoneArena: We know that online is not an easy game. What are your thoughts about it?
Yeah, it’s not an easy job. Going online and saying we are the cheapest is not the right way. We should build a unique product and we should have our own solutions, which is not easy.
We have sorted out our strategy and we have a great partner with a brilliant ROM solution and that’s the difference. Else, we could have just bought the price of our Micromax products down and sold it online.
As I said before, online market is only about 15% and right now it’s not too big. Doing the business in such a platform is a challenge. You should always build an affinity towards your community.
FoneArena: How are you trying to engage with developers and consumers in customizing the product?
Rahul: We have our own forum for consumers and there’s a separate program running for developers on our forum. We have different themes for different occasions and these are built by the community developers.
We are asking questions to ourselves. If somebody wants to build a game for us, why will he do it? So, we know we need to do something to them and we are working on all these parameters.
It’s been a great start for project Yu and as the time goes by the community will only get stronger.
FoneArena: Where do think the value in the market lies in the coming future? And, do you think a consumer would pay for solutions like a cloud back up or remote access etc?
Rahul: The value lies in software and services. If you able to provide more and more services we will be successful. I don’t think that the goal should be to charge money to the services. But, rather one must think to empower the consumers and help enhance their productivity. That should be the moto.
You need to make money to survive, but for that you’ll have to find some other way.
Well, that’s it! Thanks for your time!