Companies suffer due to reselling of cell phones costing millions.
People are buying low-cost prepaid cell phones and then reselling them in Latin America and Hong Kong. Cell phone firms claim they've suffered loss of millions of dollars because of this. Some of these companies are known to have hired investigators to prove this as 'illegal tampering' of mobiles. Wal-Mart, Radio Shack, and others have begun limiting the sales of mobiles at a time.
Use in 'terrorism' is another concern, however, traders deny it and rate this practice as 'capitalism at its best'. Earlier this year, FBI had released warnings for police to check for any mass purchase of mobile phones. This practice of reselling cell phones, though in court, is still prevalent and therefore, involved traders doesn't seem to be much baffled by this.
"Never leave a mobile behind. For making real money, just buy them all. If possible, buy thousands a day!" said Larry's Cell's Larry Riedeman in an email included in the lawsuit against the company by TracFone Wireless Inc. Many small firms such as this have been accused of buying and reselling of cell phones. These firms are termed as "middlemen in the system".
Bilal Mustafa, a buyer of mobile phones in bulk, along with his partner would buy 4-6 mobiles from each store, totaling near 250 phones, daily and then sell them to a business firm. Bilal claims, "This practice isn't illegal." Also, he denies any terrorist use of this practice. "If it did, I would not do it. I'm not a stupid!" he said.
"Actual problem is that companies sell mobiles at an inexpensive price to lure customers. These cells when resold to customers offer customers option of choosing service provider of their own choice. This is what actually baffles the mobile phone companies." said an analyst at RNCOS.
"I don't think of making a million bucks. I need just enough, so that I can take care of things such as my car, a hotel, my gas, and make a little money." added Mustafa.
Related Market Research Reports:
Global Mobile TV Forecast to 2010
Asia Pacific Mobile Handset Market Analysis
Europe Mobile Handset Market Analysis (2007)
