Is the Hundred Dollar Laptop a Real Business?

Submitted by williamkramer on October 17, 2006 - 14:10.

It was reported last week that Nicolas Negoponte and Libya reached an agreement to supply 1.2 million of the $100 computers to Libyan schoolchildren for $250 million. I was intrigued by the agreement, the math for which points up one of the problems with the effort - the computer itself may ultimately cost $100, but the infrastructure necessary - pipe, training, deployment, content etc. - takes a lot more money to make the deployment useful in local conditions. Will the Libyan money actually materialize? Who knows?


Myself, I would tend to exercise some caution when dealing with Col. Qaddafi and his bureaucracy. And the extra $130 million is just the down payment. But that is no argument against. It takes money to build infrastructure, and there will be broad benefits when a more robust IT network covers Libya. Rob and I argue whether OLPC is a "real" business. I say that $250 million is money, and even if the government is the buyer, there are lots of companies making lots of money selling things - real and imagined - to governments. Selling to governments is a business model, and if you can jumpstart the production - get the costs down - by selling to them, go for it. As my last post on this topic pointed out, the real benefits of the OLPC may accrue to all of us and the industry in general. We'll see.


. . . . .
Submitted by _suthram on October 17, 2006 - 15:18.
This can also mean that there 1.2 million people on the market who can be reached through online services. The laptops may not stop at the school or at the individual. Its access can be extrapolated to the families. So, now that there is demand. Who will supply? Take a guess.

Pradeep Suthram
pradeep.suthram@gmail.com
Life is a perpetual cycle of disproving the ordinary.


Submitted by Kevin Crean on October 17, 2006 - 19:06.
Unless MIT has really modified the new math, that's a $250 laptop. Second, I see no enduring supply chain, so it may eventually cost more (their maintenance claims notwithstanding). Third, I sense a new government perq. for the sons and daughters of Libyan government officials. Say, where can an average Libyan buy one of these?
Submitted by Kevin Crean on October 17, 2006 - 20:27.
Just some quick back-of-the-napkin numbers: $US250 million would certainly purchase 10,000 to 15,000 cybercafes outright. Given the population densities in Libya, and the fact that shared computers could benefit students as well as businesses and employers, might this not be a better use of money? Better still, invest the $250 million in an investment that bears 10% interest per annum and fund a company to rollout telecenters over several years. $25 million is an enormous sum of money: just think of all the content and all of the sustainable jobs that would be created. It's almost too much money to conceive of for a project limited to a country like Libya. After rolling out 15,000 to 20,000 telecenters (i.e. a telecenter in every conceivable dusty little town), give the Libyan people their $250 million back.
Submitted by wayan @ OLPC News on October 18, 2006 - 17:37.
Make no mistake, millions of laptops per order is big business, my back of the napkin calcs say upwards of $8 million for OLPC per order: http://www.olpcnews.com/sales_talk/price/olpc_profit_8_millio.html Then the big question is what will a OLPC implementation plan look like? So far, they've not had much to say about it: tml... .
Submitted by Edward Cherlin on October 31, 2006 - 23:51.
None of you knows much about this project, do you? Come join us and find out.

Libya has signed a Memorandum of Understanding, not a contract, for the simple reason that OLPC isn't offering contracts for signing until it is ready to start production.

Libya certainly has the money. Yes, Col. Qadaffi is erratic, and no deal is done until the contract is signed, but I see no reason to doubt that the Libyans mean it.

Now, about Libya itself...Let's start at http://www.unicef.org/infobycountry/laj.html
Libyan Arab Jamahuriya (Republic)
GNI per capita, $4450 Not bad. A lot of that is oil money.
Age cohorts (births - deaths, one year) 130,000

Well. One million Laptops would be just about enough for every child in grades 1-8. So, no, not a perq. An entitlement. A new Human Right. Libya says that it also means to donate laptops to other, poorer countries. So much the better. Sudan and Ethiopia are good places to start, but it's Libya's choice how to spend their money.

As for 10-15K cybercafes, sure, but why waste that much money? Let's give them 10,000 pens, instead, one per town. That's enough for them to write letters. No, the point is to have a computer for all schoolwork, a means of accessing the Internet for each child each and every day, and a way to communicate with the world entire. Well, as much of the world as implements the program.

It does indeed cost about as much for teacher training, infrastructure, and so on than for the laptop itself. There is nothing new in that. OLPC is determined not to repeat the mistake of many American programs to put computers in the schools without training, without funds for software, for maintenance, for upgrades, without, in a word, thought.

You who see no enduring supply chain, where have you looked? The Laptop ecology is just now forming. You can hardly expect to see it fully-formed before the first Laptop ships. Once the first Laptop project starts to show educational returns, once the children's blogs and photos and messages for the world begin to appear, companies will be falling all over themselves to join in. The ones with any imagination, that is. The rest will be like the US auto industry. But never mind. Locals will build new companies to take advantage of these opportunities if the multinationals don't get it. Just as there are more than 3,000 microbanking institutions, but none owned by Citicorp.

In the meantime, the Free Software needs of the Laptop are being met in the usual way, under the radar of conventional commerce. Apart from the OLPC segment of Google's Summer of Code, that is.

A retail version of the Laptop is planned. OLPC is talking to the companies you first thought of, but nothing will be announced, nothing can be announced, before production begins. The first five million units are reserved for schoolchildren. After that, the computer companies can have some.

OLPC USA is just getting started. Would you like to see the Laptop in US schools? Join in. Give us your thoughts. Argue about the best way to do it. But don't just give a flip dismissal. If you don't like it the way it is, make it better.

Is it really better to curse the darkness than to teach people to make candles?
Submitted by Agnes on November 9, 2006 - 15:35.
Under each charity there is interest and under every hand given to the poor there is the other hand begging or even taking something. My personal opinion is that there is no pure charity in this world and it can’t be because they have always expected something back. That’s why this laptop thing looks like a business to me. Some people get rich making others happy! ---------- Flowers England - British Florist
Submitted by Kevin W. Crean on September 28, 2007 - 14:13.
Hi: I posted a comment the other day, but I don't see that it's been approved. Can you let me know what happened? THanks, Kevin
Submitted by Rob Katz on September 28, 2007 - 14:27.
Kevin - I don't see your comment in the moderation queue, which I check daily (usually 4-5 times per day). Do you mind re-submitting or re-phrasing your comment? I apologize for the problem! - Rob

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