Intel: You call that a laptop?

Recently came across some curious comments by Intel’s Craig Barrett while he was in Sri Lanka in December. Regarding Negroponte’s $100 laptop for the world’s poor:

“Mr. Negroponte has called it a $100 laptop — I think a more realistic title should be ‘the $100 gadget.’ The problem is that gadgets have not been successful. It turns out what people are looking for is something is something that has the full functionality of a PC…reprogrammable to run all the applications of a grown up PC … not dependent on servers in the sky to deliver content and capability to them, not dependent for hand cranks for power.”

Yeah, and they’d also like indoor hot-tubs and stacked washer-dryers. Is Barrett forgetting that these “gadgets” are targeting areas with an unreliable or nonexistent power infrastructure? Is he also forgetting that the target customers are governments, not end users? If you were the government, which would you choose: give a maximum amount of the populace stripped-down computers with a hand-crank so that they can have some exposure with the outside world, or spend trillions on a power infrastructure and fat subsidies to support power-hungry, “fully functional” PCs so that the people can play Doom 3 or make hideous PowerPoints? “Sorry kid. You’re manning the crank.”

It’s hard to deny that there isn’t a certain ring of fear in Barrett’s comments. Intel created their own ruggedized “community computer” with a $220 price tag for rollout in India during December 2005. Not only is it double the price, it also requires a power source, albeit at a lower 80-volts served up by a generator. Still, having to choose between firing up the generator and eating at the end the month might limit computer use a bit – a situation compounded by erratic income flow in such areas.

Even if Negroponte’s offering blocks the success of Intel’s computer over the short term, what Intel should be looking at is the similarity between $100 initiative and the GSMA’s Emerging Markets Handset program. The key point is to get the poor “connected,” and while you can list a number of altruistic reasons behind this, in the end what these programs are doing are creating future buyers. Whereas in the past these folks would not even consider purchasing these items, growing familiarization over time breeds need, and hence, a desire to replace or upgrade down the road.

So in sense the $100 laptops are creating a foundation of computer expertise and habits. Intel can then exploit this foundation once power infrastructures improve and computers (or gadgets or whatever they are) come down in price to levels that will motivate consumer, rather than government, purchases. Otherwise, you risk perpetuating a population of non-adopters.

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