Monday, 2 February 2009

Forget the £99 Netbook - how about a tenner?

(By Richard Holway) Because of the snow, my FT didn’t arrive this morning. But, to be honest, I read most of the FT online anyway. Maybe I really don’t need the print version anymore?

One of the stories that caught my eye was India to follow $2000 car with $20 laptop. I thought the news I brought you last month of the £99 Netbook on sale next month at Next and M&S (see £99 computers go on sale in fashion stores) was pretty low. But $20 is almost giveaway territory. Actually, if you remember that was one of the themes of Deloitte TMT Trends for 2009 in January. They argued (and I agree) that the free mobile phone, satellite dish etc will be followed by the free laptop (already here bundled with a mobile broadband dongle), TV and music equipment.

In the case of India, the $20 laptop is a means of bringing education to the masses. It makes the Children’s Machine at $100 look positively expensive! This trend towards Netbooks is now unstoppable. It will wreak huge damage to the revenue models of the established players – none more so than Microsoft. (How much does the operating system cost on a $20 Netbook?) You can bet these machines at this price will flood the 'developed world' too.

This huge change in the dynamics of the industry is happening at a time of recession. The double-whammy of all double-whammies.

1 comment:

Alex van Someren said...

I think you should apply more of your analytical scepticism to this claim before accepting it. There is no basis for the claim that a BOM of $20 can be achieved. I am reminded of the "paper cellphones" fraud from a few years ago. LCD displays, CPUs and RAM just do not come for that kind of price yet, even in the hundreds of millions off. So, to be fair to the excellent OLPC XO computer (I have two in my household), actually delivering the goods should surely be the criterion for evaluating such claims?