Truth is Intel makes huge profits the way the industry works today and does not want things to change. Intel management feel that their established business model domination is extremely threatened by a small open-source hardware and software project like the OLPC project.
Fact is Intel does not have a processor that consumes as little power and costs as little as the AMD Geode processor.
Fact is Intel does not want the market to embrace $200 laptops. Intel would loose all sales of Dual Core High-K metal gate quadro core processors if most new laptops only will have 400mhz fanless ultra low voltage, since most people in fact don’t need more processing power to browse the Internet and access all their unbloated Web Apps and other most basic apps on the laptop.
Fact is Intel wants the business model of big margins on expensive hardware to continue to be the defacto mainstream standard for when people need to upgrade their computers. Fact is Intel is not present in any of the low cost new solutions coming out such as the VIA based $199 Shuttle and Zonbu desktop computers or the $150 OLPC laptop.
Fact is the Intel Classmate brings absolutely nothing to improve education nor improve battery life or lower the cost of laptops. The Classmate is designed to fail. Intel does not want to mass produce cheap laptops. Classmate has 5 times shorter battery life, double or triple the manufacturing price.
Given all these facts, I believe Nicholas Negroponte has been really polite not to tell more of the disgusting ways Intel’s salespeople in Nigeria, Mongolia, Peru, Mexico, Pakistan, India, Libya and so many other countries have been doing non other than telling blatant lies to trash the OLPC project and that Intel has given those sales people all means to attack the OLPC effort in any way possible. Threatening to remove existing investment projects such as the ones mentionned by Paul Otellini was most probably one of the dirty tactics used (just look at the facts, how much Intel say the plan to invest and have invested in Indian and Pakistani ICT, presents given to Nigerian ICT, personal level friendships and promise of free teacher training in Microsoft Excell spreadsheet software in cooperation with Mexicos presidents. Intel has been using all of its connections to undermine the OLPC project.
One Comment
Hello Charbax,
in my opinion your analysis is correct. Intel is a monopolist in this market. Therefore Intel can produce newer and newer chips, and is able to sell these expensive chips at the market.
Intel drives a strategy “one size fits all”. This company does not differentiate the customers’ needs. For example: I just need my computer to surf in the Internet, watch some youtube videos, write emails, use a wordprocessor like Word to write some documents. That is all I need.
I have a laptop which has a 700 MHZ-processor. For this kind of work the performance is fine. I don’t need to buy a new laptop with more speed.
The problem is: No company sells a fabcric-new laptop with uptodate hardware and software interfaces, combined with a 700 MHZ-processor. The fair price for such a new laptop should then be approximately 300 Euros, not more. The profit margin for a 300 Euro laptop is obviously less than that of a 1.500 Euro laptop.
Why can’t I buy such a laptop today? Because Intel wants to urge the customers to buy their latest high-tech processors. The newer the processors the higher is Intel’s profit margin.
The OLPC project goes the opposite way. They take only hardware power as much as necessary. Then they reduce/ shrink the operating system and all applications to the necessary code. And voila, the complete system runs with such debloated software fast.
The OLPC projects tailors a computer system to the specific needs of learning people. They don’t follow Intels’ strategy “one size fits all”.
OLPC serves their customer needs better than Intel does. That is why Intel uses predatory tactics. Intel fears not only the OLPC project but also the market.
Jan