Here’s How OnePlus Plans to Make Money From You

The OnePlus One is still a hot ticket item, and you can finally buy one without being invited to the club. The company made its name this year by selling a smartphone, the One, at a low off contract cost, despite offering high-end flagship specs. We love it and, so far as we can tell, so do a lot of mobile fans. But how is it going to actually continue to operate if it sells phones right around the cost it takes to make them?

That question was recently answered by OnePlus co-founder Carl Pei in an interview with The Wall Street Journal.

Pei explained that the goal is to eventually create a loyal fanbase of users who then spend money with OnePlus in other places after buying a phone. “Later on we can convert these users and monetize them through software and services,” Pei told The Wall Street Journal. “The way we see things is that hardware is increasingly becoming the distribution vehicle for software.” Pei didn’t explain what OnePlus will sell, through presumably it could be some sort of software – perhaps subscription services.

“Another thing is, selling hardware is very difficult,” Pei admitted. “Once you start actually shipping this product in bigger quantities, you start to realize that the infrastructure you’ve built is breaking down. Our logistics never planned for this scale, our customer support never planned for this scale.” That’s one reason the company has stuck to its invitation system, but one barrier it will need to overcome if it really plans to “kill” the flagships from Samsung and other major industry players.