From the very start, the One Laptop Per Child leadership has been adamant that it will only sell its first generation 2B1 Children's Machines to governments, and then only in million unit blocks. One Laptop Per Child is open to a commercial version possibility, but only hesitantly and then in much later 2B1 generations.
Also, from the very start, everyone has wondered why OLPC would not have a retail sales channel immediately - who would not want a $100 laptop for themselves or their children? Even a $300 laptop, if $200 went to charity, first generation or not.
Back in mid-August, I cut through the clutter and predicted that first generation OLPC laptops would be popping up on eBay days after the very first country took an order. I suggested and still believe that there will be a great amount of "leakage" - laptops siphoned off to friends and family connection for commercial resale from the very beginning. OLPC does not deny this, but doesn't say how they'd completely stop a grey market either.
And now with Nicholas Negroponte's confirmation of eBay sales, they've just ensured a massive grey market for every 2B1 laptop distribution. Why? Negroponte established an eBay price of $450 for 2B1 laptops, generation unspecified. If you are a government entity buying a million computers for
$100 $135, which have a market price of $450, why not sell a few thousand to pay for your massive implementation costs?
Better yet, if you are a poor family with two children and both get laptops, why not sell one to a local dealer for $200 and double your family's income for a year? Invested in livestock or new tools, that $200 could lay the foundation for an immediate jump in wealth far beyond anything your non-laptop child could earn 10-15 years from now. Make that loosing child a girl, and in many cultures there will be added social pressure to convert her laptop to cash.
OLPC may now try to minimize the eBay grey market - the re-sale of country specific laptops in the USA/Europe markets for less than their $450 mark-up, but this effort will largely fail. If the price is right, I still say its $250 + shipping, Negroponte's laptops will be popping up in schools near you days after the very first 2B1 Children's Machines are delivered to a developing country, official US versions or not.
On the supply side, OLPC could attempt to disable the laptops if they leave a certain Internet server group. If it's the completely Open Source computer they claim it to be, disabling that safeguard will not be difficult and the sellers may even have help from the very governments who bought the machines in the first place.
On the demand side, Negroponte may also try to minimize the number of people that would import a grey-market laptop through legal channels. If the Canadian prescription drug cross-border market is any indication, Americans are price conscious consumers and will buy a grey market Argentinean 2B1 Children's Machine for $250 instead of a USA model at $450 without pause.
On either side, Nicholas Negroponte's announcement Tuesday only recognized what we already knew; there will be 2B1 Children's Machines on eBay. And yet he made the grey market that much larger with an artificially high Western market price.