WSJ: OLPC XO Laptop Threatened by Intel & Microsoft

   
   
   
   
   

Today's Wall Street Journal front page has long article on One Laptop Per Child: A Little Laptop With Big Ambitions. In it, Steve Stecklow takes the position that a computer for the poor was stomped by tech giants:

I'd like to take the position that if OLPC is getting stomped (and I don't think its being "stomped" at all), its due to its own foolishness and arrogance, as much or more than any underhanded competition from Intel or Microsoft.

black Friday sale

OLPC Sales Plan Mistakes

First off, when Nicholas Negroponte launched One Laptop Per Child, he didn't call it OLPC. He referred to his idea as the "$100 laptop", forever shifting the focus from a Constructionist educational revolution to low-cost computing. While it was a marketing masterpiece, and quickly grabbed the world's attention and imagination, Negroponte created his own blowback - low-priced laptop competition.

Then, Negroponte refused to have XO laptop pilot projects where Ministers of Education could test one-to-one computing against traditional learning methods. In fact, Negroponte called pilots "ridiculous" and in today's WSJ article he is still resisting open competition between computers:

At a meeting this month in Cambridge, Mass., with representatives of Macedonia's government, Mr. Negroponte balked at authorizing a pilot project there after learning that officials also were considering testing the Classmate. He told them he didn't want to participate in a "bake-off."
Yet, when the XO laptop was compared with the Classmate PC in a Uruguayan "bake off", it was OLPC receiving a 100,000 laptop order, not Intel.

Missing: Training, Support & Maintenance

olpc testing brazil
Teacher, I need XO help

When any large organization contemplates buying technology, they should perform a Total Cost of Ownership calculation to make sure they take into account non-hardware costs like training, maintenance and support, which usually dwarf the initial hardware and software investment.

In the case of the XO laptop, we at OLPC News did a very rough calculation of OLPC implementation costs and came to a shocking conclusion: it’s the $1,000 laptop, not the $100 laptop.

Now our estimates showed high Internet connections costs, which vary by country, but didn't include another, more basic cost: electricity, which has bedeviled OLPC Nigeria.

Yet what does OLPC say about training, support, or maintenance?

  • Training: Negroponte says teacher training isn't needed, the children will learn themselves and train the teachers with a cost effective violin, the Constructionist XO laptop.
  • Support: Let's have Negroponte answer the question Ministers ask first:
    Mr. Negroponte said some initial tech support would be provided by Brightstar Corp., a Miami-based wireless equipment distributor. Just who would provide support a few years from now, he said, was "a frightening question." The students, he said, will need "to do as much maintenance as possible."
  • Maintenance: Since Mary Lou Jepsen designed a computer that "five-year-old kids in Nigeria can screw it together" who needs maintenance? Kids will keep a million-unit Humpty Dumpty from happening by using the view source key
olpc subsidized sales
Pointing to a OLPC Peru future
OLPC Can Recover

Before it sounds like OLPC is stomping itself to irrelevance, do note it has the resources to turn the program around and become a roaring success in implementation as well as computer design and philanthropic marketing.

From the WSJ article, we find One Laptop Per Child is a multi-million dollar organization:

Robert Fadel, its director of finance and operations, says the nonprofit has enough funding to last years. Its dozen corporate benefactors this year contributed $16.5 million, and it will be using $1 from each computer sold to cover administrative costs.

Last year, it took in $7.6 million in revenue, mainly from donors, and its budget this year is about $9.5 million. As of September, it had $8.7 million in cash on hand, an internal document indicates.

From the recent G1G1 sales extenstion we learn that OLPC is awash in cash donations, averaging $2 million dollars per day, in addition to the numbers above. Give One Get One also shows that OLPC has huge public support.

Just look at what HitWise says about Internet traffic during G1G1:

Last week, there were more than two and a half times more US Internet searches for "one laptop per child" than for "laptop". It was the top search term that included the word "laptop" last week though it still trailed the higher volume search term "laptops".

To put this into further context, there were more searches for "one laptop per child" than for "paris hilton" or "george clooney" but fewer than for "britney spears".

Now with such intense public support, One Laptop Per Child could make a transformation from a laptop project to a education project with a few simple, yet radical changes.

olpc nigeria
Parent + child + OLPC = Education

A Successful OLPC Model

Imagine this global yet local Give One Get One XO laptop distribution organization: Anyone, anywhere can buy an XO laptop for $200 from the Quanta-supplied, eBay administered, OLPC sales program. Groups could buy XO laptops in 100+ lots for less. As sales increased, laptop prices would decrease.

The One Laptop Per Child Foundation, funded by XO technology royalties would have two roles:

  1. Designing the XO-2 laptop, with whatever components work the best to deliver low-cost, high-performance computers in the harsh developing world environment.
  2. Propagating and promoting local XO user groups who are empowered with official OLPC lesson plans, maintenance guides, and training modules.
This would represent a major shift in OLPC thinking, from the center of attention and action, to a more distributed, almost franchise, model. Nicholas Negroponte would no longer be the OLPC spokesperson, and we wouldn't need an OLPC hero.

Those roles would be taken by the most committed local educational stakeholders, those that can and do influence Presidents of countries and Ministers of Education: parents of school-aged children.

In addition, this plan can include other educational organizations. As Lylah points out in the comments, OLPC has overlooked the fact that most governments care less for their poor than targeted non-profit organizations. Last but not least, local organizations, be they formal nonprofits or informal user groups, could develop and provide ongoing XO laptop training, support, and maintenance, OLPC's massive implementation gap to date.

The winners: all children
The losers: only egos

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24 Comments

How could that "reporter" fail to mention that the classmate costs about the same as an XO? If the problem is poor countries can't afford an XO how can they afford the more expensive classmate?

Maybe the problem is you can buy 100 classmates to run a pilot but you can't by 100 XOs?

Also the fact that classmate has a support structure in place.

Also the fact that NicNeg can really get on your nerves?

Wayan, I agree with you: IF.

It appears that like many not-profits, OLPC hasn't adopted the aggressive/competitive stance that it needs, either in fundraising, marketing, or sales. G1G1 is a fantastic start, but it could be so much greater. And if more capital were secured, production could increase, unit costs decrease, and sales to the "rich" could definitely be reinvested in the needy, those who all of us want to see empowered with this wonderful tool.

Intel? Not really an issue. OLPC is as much as anything a philosophy and a sea change in education, as much as a philanthropic mission. But it isn't aggressive enough, and money is the lacking ingredient.

Kudos to this website for keeping the discussion alive, keeping the passionate connected, and contributing constructive critique to the process.

This is probably the most interesting paragraph from the WSJ article:

"Mr. Negroponte says he complained to Intel's chief executive two weeks ago, then "made peace." Intel and the One Laptop project, he says, have agreed to work together to design by early January a new "Intel-based" One Laptop device. An Intel spokeswoman confirmed Mr. Negroponte's account, but said any comment would be "premature."

So it looks as though the X0-2 will indeed be powered by Intel (just like Intel always wanted). However I also think that "early January" isn't quite realistic!

Other than that the article just points out many of the things that Wayan et al. have critized about OLPC for a long time: apparently no real commitment to vital aspects such as support and teacher training. Those are the things were Intel is definitely way ahead of OLPC and since these points are so crucial they have an enormous influence on whether a country decides to invest in which program to invest!

I for one have no problem with the altruism of OLPC, but you have to wonder at the motivations on INTEL - from WSJ --

"Last year, Intel, which normally doesn't sell computers, introduced a small laptop for developing countries called the Classmate, which currently goes for between $230 and $300. It has marketed the computer aggressively, although it stands to make little money on the initiative. But it hopes to prevent rival Advanced Micro Devices Inc., or AMD, whose chips are in Mr. Negroponte's competing computer, from becoming a standard in the developing world."

Mike,

I wish money was the issue. Just look at the OLPC Foundation wealth as detailed in the WSJ article (below) and you'll note they have the cash to be long-term & well funded force for change - IF they don't blow their goodwill with continued arrogance.

Remember, Negroponte wants to stop G1G1 on Dec 31, as individual sales are a "distraction" to his mission.

Mark,

I think Intel or Microsoft would never have noticed OLPC if not for Negroponte calling it a "$100 laptop" and promising 10 million laptops a year - essentially saying he was going to be the world's largest laptop seller. That would get any computer manufacturer's attention and competition.

If the XO fails I believe it will not be the fault of the computer. From all reports, the computer is a fantastic design.

By limiting sales, except for the G1G1 program and the Give Many program, to governments, OLPC has overlooked the fact that most governments care less for their poor than targeted non-profit organizations. It seems to me that the OLPC is also still learning how to run something this big as well. The logistics must be daunting.

Socially responsible government is still pretty new and many politicians are more concerned with retaining their advantage than actually helping people. By limiting sales to government entities OLPC has (possibly) crippled the distribution of the XO.

Also, though this is largely a volunteer effort (at least it appears that way to me, if I am wrong I apologize) it does appear to need some organization, especially in the case of the G1G1 program. Many people seem to be quite confused and though some of it is from people simply refusing to look for answers, even people looking for answers are finding them hard to come by.

My last point is that any time someone implements a very good idea people will attempt to emulate it and put their own spin on it. Though the EEE and the Classmate do appear to compete with the XO, the XO is in a class by itself.

In the last year I read an article somewhere about how there have been several really cool computers and/or operating systems which faded into history due to unfortunate circumstances of one sort or another. They are almost completely forgotten. Unfortunately I cannot remember where I saw it or too much about the article. I was in a Mac magazine or something related. It is my hope that the XO does not get added to this unmemorable list due to mismanagement.

That said, I ordered 2 from the G1G1 program and crossed my fingers. this is too good of a program not to try to support it.

Lylah,

Here is a full list of the known low-cost computing options and their status: http://www.olpcnews.com/prototypes/olpc/low_cost_computing.html

And you are right, OLPC is in a class onto itself, but as it doesn't embrace nonprofits, it is diminishing its own abilities to implement.

Wayan, thank you for that clarification. Yes, that seems to be plenty of money. That sure makes the execution of the program appear flawed, and wouldn't that point to either a problem with mission or management? Clearly, the philosophy is correct. But the program is broken and needs a fix. Selling laptops via G1G1 is certainly a good way to keep the production line moving and help the truly needy. I wonder if your and my donated XOs have identified recipients?

Keep up the research, and let's nudge this program to greatness!

What was olpc news fonder Waynes contribution to world peace and education for all before the invention of the olpc foundation and google addwords?

"foolishness and arrogance"

Mike,

I am beginning to wonder if Negroponte is keeping G1G1 open mainly to satisfy his suppliers who thought he would have millions of laptop orders by now. Here is a telling quote from today's article:

------

Suppliers are grumbling about missed forecasts and lowered expectations. "We wish they would ship more, absolutely," says Scott Soong of Chi Mei Group, the Taiwanese manufacturer of the laptop's screen, who also serves on One Laptop's board.

Laptop-maker Quanta, which was told early this year to expect initial orders of five million to eight million, also is disappointed, according to a person familiar with the matter. "We're all frustrated with each other," says Mr. Negroponte of the friction with Quanta and suppliers. "Everybody's got a short fuse."

---------

It seems to me that OLPC is going through the same stages as any other developmental project involving technology. It is moving from issues of physical access to the issues of human capacity building. In fact the entire discourse about digital divide has gone (well is still going) through this shift. So, i think this is natural and the figures you offer here are encouraging when it comes to the sustainability aspects. I like your suggestions about the strategic changes for OLPC program. They make sense.

I can think of two major problems the OLPC organization has to overcome before really large volumes of the machines can be sold:

The most dangerous problem is that of politics. Most poor countries are poor not because they are located in Africa or because they don't possess natural resources, but because for generations they have had to endure really bad government. Trying to improve education and long term living conditions in these countries by negotiating with these same weak, and sometimes outright malicious, governments may well turn out to be a fallacy.

Secondly: it's the software, stupid! I love the hardware (and I can't wait to get my hands on 'my' machine ;-)) and I like the Sugar UI; even for many western users it makes more sense than the window(s) computing metaphor we've grown accustomed to. What I don't like are all the other programs on the system... Let's be honest: they look awful. As far as I've seen, there is nothing about the activities themselves that really stands out and there is no consistency between different activities. On top of that most are clad in a depressing shade of gray. I have the awful feeling that these machines are going to lay mostly unused if they don't come with better software and with educational programs needed to exploit these new tools. Negroponte is quoted as saying: 'this is not a laptop program, it's an education program'. So bring in the educators.

To end on a positive note: in a way you can argue that the OLPC program is already a success; it has created competition amongst manufacturers to provide low cost computers in large quantities. I doubt that this would have happened without the existence of OLPC.

Patrick,

I agree - what Negroponte calls shameful competition, I call amazing success. Two years ago, Intel didn't care about poor kids. Now they are spending millions to develop chipsets for them. That shift is a pure OLPC achievement.

And interestingly enough, low-cost laptops regardless of supplier was part of OLPC's original mission:

"OLPC is not at heart a technology program and the XO is not a product in any conventional sense of the word. We are non-profit: constructionism is our goal; XO is our means of getting there. It is a very cool, even revolutionary machine, and we are very proud of it. But we would also be delighted if someone built something better, and at a lower price."

http://www.olpcnews.com/use_cases/education/olpc_mission_constructionism.html

"""I am beginning to wonder if Negroponte is keeping G1G1 open mainly to satisfy his suppliers who thought he would have millions of laptop orders by now."""

I didn't think of that but it makes sens to me now. Quanta must be pissed off by the sells of the classmate and Eee, both produced by his smaller competitor Asus. Asus who happily says on his website concerning the Eee: "ASUS Eee PC is America’s Most Wanted Christmas Gift" http://eeepc.asus.com/en/news11212007.htm

""" By the end of this year, the projected sales goal of 350 thousand will be met; and next year that figure is projected at 3 to 5 million. """

If Asus can keep up with the demand (right now the Eee is out of stock nearly everywhere) and if Negroponte doesn't change his distribution scheme, these numbers (+classmates) could be much higher.

Meanwhile a happy ecosystem around the Asus Eee is growing... http://forum.eeeuser.com/search.php?action=show_24h

francois

Wayan, I agree completely (except that I'm ignorant as to whether it's getting stomped). "If you build it, they will come" is not a rational marketing plan.

Even the "inevitable" revolution of the proletariat needed help from the intelligentsia. Come to think of it, that was a project that took flight in the "wrong" countries, too. Before it mostly crashed and burned, but that's another story.... ;-)

Microsoft's resources dwarf OLPC's in nearly every area - hardware development, software development, negotiating power with manufacturers, distribution channels, after-sales support.... If MS wanted to give away a billion dollars worth of computers along with free licensing for five years, I assume they could do it.

OLPC's advantage was/is concept. It's made possible by an absence of stockholders and it generates immediate interest in people who live in rich countries as well as in poor.

I use the awkward construct "was/is" because if the concept _was_ only low initial cost, well, it should have been obvious that that could easily be preempted.

If the concept _is_ something more wide-ranging, then the initiative can stay with OLPC. But not by blunting the interest of all possible users by saying that their issues are not your issues.

So, looking around quickly, are there any other resources OLPC could bring in, especially in the (surprise!) critical area of customer support?

Again, I confess my ignorance. I haven't followed the project. But has the worldwide Linux community been approached in that context?

I'm with everyone who:

1) wants the best for OLPC and the XO
2) believes that NickNeg and pals have mismanaged a lot of this
3) think a severe change in course is required

However, I'm not sure Wayan's changes are the best ideas since they would require an extreme change in course--one that I don't think even a for-profit company could pull off with any amount of speed.

As for G1G1, I definitely think it should be extended forever. I understand that saying it's limited now is good for marketing, but actually cutting off the program cuts off plenty of people who may want to take part but can't immediately justify dropping $400 on a laptop (even a cheap one). It's not like the US economy is booming. People need time to hear about the program and then save up to do it.

Forcing every North American to buy 2 XOs and only get one is a great plan and I don't see how it can go wrong (especially if sales of eee PCs are any indicator). Maybe through donations they can expend the program to meet legal requirements for shipping to the rest of the 1st World.

Also, my opinion on training the kids and providing all of those other services (maintenance, repair, etc) is this: who provides them in the 1st World? When my computer breaks I fix it. When I used a Windows computer for the first time in the 1990s, I had no experience to base it on, nor did I have training. The Internet was seriously limited back then and I just taught myself.

Nowadays when my machine breaks I fix it myself. Sure, if it's still under warranty I take it in, but is the percentage of crappy machines that great?

Maybe it is. I guess I'm just used to getting screwed by computer companies (even Apple) in the "fend-for-yourself" America that exists today.

Sure, it's not a perfect system to suggest, in fact it sucks, but if 8 or 9 kids can have laptops that work while that 9th or 10th kid goes without, aren't we still doing better than before?

I guess I'm just puzzled as to why we keep expecting miracles from a non-profit in today's money-driven world. It's as though we expect the pure motivation to make all hurdles to go away. I mean, it's hard for for-profit companies to survive and we're expecting perfection.

Simply not enough people are pointing out the good things OLPC has done. As Patrick mentioned abve, if One Laptop Per Child were to close up shop tomorrow, sad as that would be, the world would still be a better place for it having existed at all.

Intel needs to STOP marketing ULV based laptops as a part of the OLPC project. Intel knows, everybody knows that ULV processor based laptop is NOT usable for school kids. Battery power is extremely bad, price is about the same price as a normal 10" full sized laptop.

Not until Intel has got a chip with the power consumption of the XO, a platform with the same cost as the XO, not until the Intel or Asus powered laptop brings ebook screen of the XO, ultra low power DCON feature, WiFi Mesh or/and low power WiMax, not until that day should Intel nor Asus market their first generation education laptop as an XO alternative.

It's great that Intel is investing hundreds of millions in developping the Diamondville processor, as a low power and low cost AMD Geode alternative. Now Intel should focus on that.

Asus Eee isn't a bad laptop compared to what else is on the market today, but Eee should not be marketed as an OLPC XO alternative. Asus should work on preparing to mass produce their XO, but they should not try and sell it to school children instead of the XO laptop.

The deal could be like this between Intel/Asus and OLPC/Quanta/CMO/Marvell, that the target is that Intel and Asus produce half of the XO laptops if they want. But they need to adapt in terms of having low power, really low cost, and be education friendly.

If Sudan is in need, then Red Cross shouldn't compete with Unicef, no instead they pick up the phone and they work together to help as many people as possible. There are 3 billion kids out there in need for a better education, there is plenty for Intel and Asus to do. Competing with a non-profit organisation as OLPC is completely insane.

Wayan,

There is real evidence that MS and Intel do have used their financial and political power to fight the OLPC.

Public letters, public appearances, investments in countries that only then decided the OLPC was useless, price dumping of MS Windows and Classmate. Most of these practises would have been illegal if they had been done in say, Germany. MS has already been convicted several times for similar practises and Intel is currently in court for them.

The OLPC may have made many mistakes, some of them out of ignorance or foolishness, some of them simply due to a severe lack of trained people. But some of the best and brightest organizations have been destroyed in the past by MS and Intel using similar tactics (eg, Be OS).

All humans make mistakes, but in a war, it is still your opponent that kills you. And I have seen too much evidence to dismiss the idea that this is a very dirty war.

But I must admit that I am biased. From the first minute I have never believed that MS would allow the OLPC to succeed. It was just my ignorance that I didn't forsee that Intel is an even more conniving industrial war lord than MS.

Winter

That all depends on what the goals of OLPC are. If the goal it to give children in undeveloped countries access to the internet as a learning tool it doesn't matter which box they use to do it. If the goal is to have their countries buy the OLPC designed box then they need to get marketing people on board, quickly. These people will believe the buyers when they say what they want, (like maintenance and support) instead of telling them to take it or leave it.

The Red Cross and UNICEF don't compete, they do different things so you could have a situation where both organizations are on the ground. From the point of view of the recipient, if UNICEF is 'supposed' to deliver the water, but the Red Cross can get there faster, I say let the Red Cross do it.

Don't get me wrong, I think the XO is a technological breakthrough, but any buyer would want some questions answered first and doesn't want to be treated like a Luddite for asking them. OLPC pointed out a huge untapped market, of course profit-making companies are going to try to exploit that market.

Okay, seriously, let's discuss the "competition".

Classmate: Intel still doesn't seem to grasp where exactly the XO is supposed to be used. Their systems are STILL electricity-based. What happens if there are limited numbers of electrical sockets? Oops!

Not to mention Windows is the absolute worst OS to ever be considered for a "low-end" computer. When in its entire history has Windows ever been "low-end"? Minimum requirements for it jump processing generations every release!

Microsoft, despite all its cash reserves, are only involved in this for one reason: they fear the idea that people somewhere might realize that the computing world does not exclusively flow through them. That's it. Hence their attempt to push OLPC into using Windows XP in place of the customized Linux they designed for it, and hence their funding of the Intel Classmate - which, if history is any indication, likely has a requirement that Intel promote the Windows versions and downplay the Linux versions in exchange for not being charged through the roof like everyone else.

Asus EEE - Okay, let's be DEAD serious here. This one is designed for one very obvious purpose. The purpose of the Asus EEE is NOT to offer a low-end laptop; the purpose of the Asus EEE is to make Linux look like a slightly cheaper Windows ripoff. Hence the stupid decision to go with Xandros instead of a real Linux distro (Xandros likes to claim their version of Linux is "easy for Windows users" - yeah, easy because they stole the Windows UI in a shoddy attempt to fool people into thinking that their system actually IS Windows), and then turn around and try to make it work even MORE like Windows. Then they offer it only slightly cheaper than the version with Windows. The difference in price between Linux and Windows is way more than $100, so I'd be asking if Microsoft is handing out a discount, and if so WHY? Is Asus getting a Windows discount if they try to trash on Linux as much as possible?

No, OLPC is not perfect, but honestly, the "competition" has such horribly artificial motives I'm surprised no one has bothered to call them on it yet. And ANYONE who thinks using Windows over everything as a "low-cost easy OS" is being bribed by the Vole. Period.

The money quote: "... Mr. Negroponte told them, adding that he has a "royal battle" with his Windows-based computer nearly every morning."

How come Negroponte doesn't use this computer himself? If it is so good. Anyone at his nonprofit use it?

Oh, it doesn't have any applications software?

Just add this one to the ash heap of computers that have bit the dust over the years because they didn't have any software.

Computer users want software compatibility, period. IBM rose to prominence because of software compatibility amongst their OS/360 line of mainframes. Intel almost went under with their iaxp432 chip that was incompatible with the 8086. Intel lost big time to AMD when they decided to pursue Itanium (you thought someone would have remembered the iaxp423 debacle).

Anytime some genius decides to storm the computer market with words that include "develop our own operating system", they are more than a little clueless.

So it is time the OLPC project folks "ate their own dogfood". Use that computer for all your personal computing tasks. Show us in a educational study how this is somehow better than a "Learning Laptop" from Toys R Us for $29.99 that runs on 4 AA batteries.

I agree that direct sales programs like G1G1 should be expanded. Despite media coverage the majority of people in the US still haven't heard of G1G1. What's going to happen when tens of thousands of children in the US and Canada receive their laptops and show all their friends and teachers in school? Demand for the laptop is going to skyrocket right after the G1G1 program ends. A direct sales program needs to be in place to continue to supply that demand and the goodwill such a program would generate.

I read the article and frankly it totally pissed me off. Just as Naomi Klein discussed in her recent "The Shock Doctrine," these for-profit corporations view charity - any charity - as competition to be crushed. How dare people provide some useful thing for cost (or free) when it could be SOLD to them for profit and increased share value? After all, if you’re poor its your own fault and you deserve your fate….

The fact is, the Intel/Microsoft scheme is perfectly predictable, creating yet another web of dependency for the developing world. These countries that invest in all these Classmates and $3 Microsoft software packages are locking themselves into dependency on these for-profit corporations who WILL - sooner or later - begin jacking up the prices and making upgrades and the like more expensive since the clients will be forced to deal with them in order to not waste their previous investment.

One of the primary advantages of the XO and its reliance on Linux-based freeware is that it is non-proprietary and upgrades and future development is open and free. Some kid in Uruguay may come up with some great idea; and on the XO everyone will have access to it; whereas some kid in Libya with the same idea will either never be heard, or if he is, his idea will be exploited by Intel/Microsoft to add billions more to their already bloated coffers.

The entire idea of the XO (at least as I see it) is in part to close the technology divide between rich and poor countries thereby leading to their empowerment. These Intel/Mircosoft schemes are the exact opposite, one more effort at enslaving the developing world in a web of dependency based on the tender sensitivities of multinational corporatism.

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