Computing: The ambitious “$100 laptop” programme is having a few problems, but it may have catalysed a whole new market

IN NOVEMBER 2005, at the World Summit on the Information Society conference in Tunisia, Nicholas Negroponte, a professor at the Massachusetts Institute of Technology, unveiled a small, cute, lime-green computer. The “$100 laptop” caused quite a stir among those interested in economic development. Dr Negroponte and his non-profit venture, One Laptop Per Child (OLPC), hoped that the combination of clever design and the scale efficiencies of manufacturing would make it possible to make the laptops for $100 each. Governments in the developing world, he predicted, would order millions of the laptops and give them to schoolchildren, triggering a revolution in education.

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A source of inspiration

Sceptics argued that it would make more sense to spend the money on other things—water, sanitation, health care, teacher training—rather than laptops. Large orders from governments failed to materialise. Two-and-a-half years after it was unveiled, the machine, now officially known as the XO Laptop, still costs nearly $200 to make and only about 300,000 of the things have been distributed. And in recent months several senior figures have departed from OLPC, casting doubt over its ambitious goals.

But in one respect the XO Laptop has undoubtedly made an impact: by helping to spawn a new market for low-cost laptops. Hardly any models costing $500 or less were available when the XO burst onto the scene, but now there is a wide selection of such machines, from familiar makers such as HP and Intel, and from relative newcomers such as Asus and Pioneer Computers. By raising the very possibility of a $100 laptop, the XO presented the industry with a challenge. Wayan Vota, founder of OLPCNews.com, an independent website that follows the project, calls the XO a “harbinger of an entirely new class of computers”.

The Classmate PC made by Intel, the world's biggest chipmaker, is arguably a direct rival to the XO. In July 2007 Intel joined the OLPC project, but pulled out in January 2008. Its departure stemmed from the rivalry between the Classmate and the XO, which take very different approaches to promoting low-cost computers in the developing world. The XO is a radical, clean-sheet design that runs the Linux operating system under a graphical interface called Sugar. The Classmate, by contrast, is a full-fledged but cheap laptop (it costs $300-500) that runs standard Windows software. Intel's promotional literature, touting the Classmate's “real PC capabilities” looked like a swipe at the XO.

But Intel had a point. The XO's Linux-based software is free and can be freely modified by users—something the XO's backers were keen to encourage. But government and education officials would prefer to stick with the software that has, for better or worse, become the worldwide computing standard. In May Dr Negroponte conceded that the lack of Windows support had hindered the XO's adoption, and announced plans to produce a new, Windows-based model.

Although the Classmate may have stolen some of the XO's thunder in the developing world, another low-cost laptop has been a runaway success in the developed world. The tiny Asus Eee PC, little bigger than a paperback book and weighing less than a kilogram, sold more than 300,000 units in 2007 alone. It is now available in several versions: the most basic model, with a seven-inch screen, costs $299, and a new high-end model with a nine-inch screen costs $549. HP, the world's biggest PC-maker, entered this new market in April with the “Mini-Note”, a small laptop weighing just over a kilogram. It too will cost under $500.

All of these new machines are being aimed at consumers in the rich world, who like the idea of a computer that can be taken anywhere, as well as being sold for educational use in poor countries. The $100 laptop has been a success—just not, so far, in the way its makers intended.