It may have once dismissed the OLPC (One Laptop Per Child) Project as a "cheap gadget," but Intel appears to have changed its mind. The company is now involved in talks to provide CPUs for the $100 (actually ~$175) systems.

According to the EETimes, Intel's newfound interest in the project is just fine with the OLPC design team. "Intel, like a lot of other people, is more than welcome to try to design great silicon for this project and this mission, and we've been working with them to help them do exactly that," said Walter Bender, OLPC's president.

Up until now, OLPC has been based on the AMD Geode, and it may be the functional weakness of that architecture that has Intel interested in capturing the OLPC market. As we mentioned earlier this year, the Geode is a less than ideal x86 architecture.

The Geode LX-700 at the heart of the XO is a 433MHz chip whose design is based on the Cyrix MediaGX processor that debuted in 1997. With its 128K of L1 and 128K of L2 cache, support for DDR266, and its significantly faster clock speed, the LX-700 is obviously more powerful than the Cyrix 5x86 core on which it is based, but the heart of the CPU is still reliant on a non-superscalar architecture capable of executing only a single operation per clock cycle. Intel's Celeron M is inherently a more powerful CPU, though the lack of L2 cache in Intel's reference design will obviously impact performance.

In short, the OLPC XO is currently running on a CPU core that doesn't even qualify as a 5th-generation Pentium-class CPU. Intel, in contrast, is talking about building an OLPC system based around either modified Celeron processors or the upcoming dual-core Silverthorne, built on a 45nm process. The company seems to think it can do this in a cost-effective manner.

As for the OLPC group, it doesn't appear to be ruling out any supplier and has even tossed out the idea of building different OLPC systems for children with different needs growing up in different types of environments. Bender was quick to point out that the Geode hasn't been a limiting factor in designing the OLPC thus far and even floated the idea of using an XScale processor designed by Marvell. No one at OLPC is screaming, "We need more power, Scotty!"

Still, the door is open for any company that would like to pitch its CPU as capable of handling the OLPC's unique demands—and it appears no company, not even AMD, can rest easy as having "won" the design long term. That said, AMD isn't too worried about Intel's new love for OLPC.

AMD sitting confident

In the wake of Intel's decision to fork over a little cash and hop aboard the OLPC train, we had the chance to talk to Rebecca Gonzales, director of marketing communications at AMD, about how the company feels about Intel's Johnny-come-lately move.

To put it bluntly, AMD isn't worried. "We see nothing changing currently" with the XO, Gonzales said. OLPC began designing the XO in 2005, and in the early days the project planned on incorporating AMD's GX processor line. The XO is now powered by the Geode LX processor line, and Gonzales says that "the whole device would need to be redesigned" were OLPC to make a CPU change at this stage.

"At performance per watt, we do very well with the Geode," Gonzales said, claiming that since the Geode doesn't require a fan, it is really a superior CPU to anything Intel can offer right now. The fanless Geode can be secured in an enclosure that will keep out dirt and water, making it a better choice than any fan-cooled CPU that would necessarily require more openings in the design.

Gonzales said that AMD can also offer better battery performance. According to Gonzales, "the LX uses .9 watts, and no one can meet that right now." Total CPU and chipset power consumption is approximately 3 watts, she said.

While there may be a showdown between AMD and Intel over who gets to ride in the front seat, it appears unlikely that there will be a design change with the current iteration of XO laptops. OLPC Project members have publicly talked about a second design only coming in late 2008 or 2009.

Competition between AMD and Intel over the OLPC? Something tells us that Nicholas Negroponte has been waiting for this for quite some time.

Ken Fisher contributed to this report.