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eBay sellers exploit Xiaomi flash sale, offer Mi 3 at inflated prices

Manas Gupta, a media professional, saw Xiaomi Mi 3 smartphone on the company's India website in the middle of July and fell in love with it. For him Xiaomi was an unknown brand compared to something like Samsung or Sony. But Gupta found the Mi 3 to be the "perfect phone". And the price of Rs 13,999 was "just brilliant". The Mi 3 was exactly what he was looking for. It was sleek, was packed with powerful hardware, had a camera that seemed decent and sported a gorgeous large screen.

Gupta pre-registered with Flipkart, the only authorised seller for the Xiaomi phone in India, with the intention to buy the Mi 3 as soon as it was on sale.

Nearly a month later on August 19, Gupta bought a Motorola Moto G. He didn't want to get the Moto G. But he had no option. He could have paid sellers on eBay Rs 20,000 to buy the same phone that Flipkart was offering for Rs 13,999. But he decided against that.

Gupta is not the only one who was looking to get the Mi 3 and then ended up getting something else. There are thousands like him in India, let down by the contrived sale model that Xiaomi and Flipkart has cooked up for the Mi 3. The model seems to reward scammers, who have bought several units of the Mi 3 in the last few weeks and are now selling these devices on websites like eBay, Olx and Quikr, even when genuine consumers can't get one.

So far, the Mi 3 has been put up for sale on the Flipkart website five times. On each occasion there were limited units -- numbering thousands -- available even when the number of people showing an intent to buy the Mi 3 was more than several lakhs. On the first occasion on July 22, all available units of the Mi 3 were sold in 40 minutes. Gupta tried buying the phone at that time, but didn't get it.

The next four occasions saw particularly frenzied sale process. On the second occasion, the stock lasted 5 seconds, on the third occasion 2 seconds, on the fourth occasion 2.4 seconds and on the fifth occasion 2.3 seconds.

While Xiaomi has boasted about how quickly it is selling the Mi 3, thousands of consumers have been left disappointed by the sale model the company is using. The flash sale format not only requires, according to Flipkart, to "register for the sale" and "log in 2-3 hrs before the sale begins" but also seemingly has loopholes that scammers are exploiting.

People have reported that buying the device is easier if a consumer is using the mobile app of Flipkart. Then some have managed to snag the device using a special browser plug-in that apparently helps people beat the virtual rush on the Flipkart website. A few others have reported success in getting a Mi 3 unit by using a javascript hack that reportedly automates the buy request on the Flipkart page for the device as soon as the sale starts.

All of this puts less tech-savvy consumers or those who can't be in front of the computer at 2PM (the time when the Mi 3 sale starts) at a huge disadvantage. If these people want the Mi 3, their best bet is a eBay seller charging nearly 50% to 60% more for a phone that he is not even authorised to sale.

For example, there is an eBay seller going by the name Mujib Shaikh. Even though Flipkart limits the number of the Mi 3 units a buyer can get to one, Shaikh has multiple Mi 3 units in his possession. His eBay advertisements shows that this week he put up three units of the Mi 3 units on sale at a price of Rs 19,999 per unit. The eBay advertisement clearly mentions that the Mi 3 units were bought from Flipkart. Until the evening of August 20, Shaikh sold 2 units of the Mi 3.

Another seller named Ganeshsun has one unit of the Mi 3. "Confirmed order from Flipkart, Will be delivered in un-opened packing condition. Will also assist the buyer within the 30 day FLIPKART Replacement Period, should the delivered piece have any defects/issues," he writes on his eBay page.

Another seller, Aniket1992, who has one unit of Mi 3 for sale at a price of Rs 22,999 says on his eBay page, "Couldn't grab one from the online sale? No worries! Buy one here!"

"The flash sale model shows that Flipkart and Xiaomi don't care about their consumers. They are only bothered with creating a buzz for the Mi 3 and instead of serving genuine consumers. If the supply was low, the companies could have asked consumers to pre-book the device and could have delivered when they had it in stock instead of asking them to take part in a frenzied sale process," said Gupta.

Despite repeated attempts, Flipkart and Xiaomi couldn't be reached for a comment. However, Xiaomi India head Manu Kumar Jain had earlier told the Economic Times that the company was aware of people selling the Mi 3 units on eBay at inflated prices. "We can't legally stop them from selling it (Mi 3) after buying, but we're working with Flipkart to put some checks and balances in place," said Jain.

Pankaj Ukey, head of eBay India merchant services, did not comment on the specific sellers or products but said, "eBay India is an online open marketplace and an intermediary. We provide an independent platform to our users who are independent buyers and merchants, thereby enabling them to transact. Users of our website are required to adhere to the terms and conditions of our User agreement and policies and comply with applicable provisions of law."

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