OLPC's Goal: A $30 Billion Dollar Company!


Walter Bender of OLPC

While ogling One Laptop Per Child's revolutionary dual mode screen Walter Bender revealed a revolutionary idea about OLPC's overall goal.

Nicholas Negroponte has always said he wants a $100 laptop CM1 2B1 XO Children's Machine for every child in the developing world. And Walter Bender explained the numbers behind that goal.

OLPC estimates that there are 1 billion 6-16 year olds in the developing world. If it were to equip every 6 year old, each year, OLPC would need 100 million Children's Machines (10% of 1 billion) and to replace each OLPC XO at 11 years old would add another 100 million.

200 million laptops would cost $20 Billion dollars, give or take a few hundred million dollars. Add in $10 Billion for infrastructure and OLPC estimates it would need around $30 Billion per to achieve its goal.

$30 Billion in income each year. $30 Billion Dollars!!

In perspective, Intel's income last year was $35 Billion and it's number 49 on the Fortune 500. The World Bank only lent $23 Billion in 2005 and it's the premier multilateral financier. Note those are loans too, not grants, and borrowing countries are expected to repay the loans.

And what about those countries that One Laptop Per Child is targeting? Argentina would need to spend half of its non-salary education budget for only 10% of the student body per year. Nigeria would need to spend 73% of its budget to reach full One Laptop Per Nigerian Child penetration.

So while I find the concept of One Laptop For Every Child amazing and alluring, $30 Billion dollars, and that's Billion with a "B", is still $30 Billion dollars, no matter the good intentions.

And $30 Billion doesn't fit into a tin cup.

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Why are you pretending to be a fan of the project when your site is so obviously slanted against it?

Xero, who is pretending?

We love the OLPC technology, its clock-stopping hot. And we're glad Negroponte restarted the technology in development dialog.

But we fear that reality is being swept aside by grand dreams that are over-promising educational change with a $30 Billion annual price tag.

Having just returned from a private conference where Mary Lou Jepsen gave an hour-long presentation on OLPC, I conclude the following:

1) The technology is a great hack, especially the display, which will be badly needed as an alternative to current generation TFT LCD displays. Go Mary Lou!

2) The wheels are going to come off the project when the first units are delivered to countries for actual installation and development of educational software. Those machines will not be allowed outside the classrooms, no matter what the project says. The educational software will be developed within those constraints and great care will be taken to limit the networking so that kids will not be bypassing teachers by passing notes in class.

The whole now-you-see-it-now-you-don't ("it's a hardware project/it's an education project") prestidigitation wil bog down in encounters with reality as interpreted by the educational ministries, especially when they add up the numbers.

I am developing other analyses based upon my conversations at this conference and will publish them later on my blog.

Keep up the reporting, Wayan. It's a minor scandal that you're the only one keeping a properly skeptical eye on this project.

Healthy scepticism is a good thing. Its so easy to get swept up in the hype of a 'panacea for all mankind' attitude. The OLPC idea is great. Affordable laptops for education has been sorely needed for many years (I live in a first world country and barely afforded a laptop for my sons school years).
What the OLPC project has done is galvanised into action a diverse group of professional (and non-pro) experts to build a design better than anything an Asian PC factory would dare turn out.
Adults and children can all benefit from this product. Maybe the $300 US retail price will allow the OLPC to give laptops to the Third World. What they do with them then is up to the educators in those countries.

Good point, Revolution. Even if the olpc project falls flat on its face, the idea and the technology will be picked up and re-worked into something practical.

OLPC has one and only one goal: one laptop per child. To achieve this goal, in the steady state, we estimate that the world must invest $30B in its children. I leave it to the reader to debate whether or not such an investment is worthwhile. To suggestion that OLPC has the intention of becoming a $30B company is unfounded: its oft stated strategy is to start a process whereby a diverse collection of industry interests and governments and NGOs to all pull together towards a common goal.

Economics aside, anyone who has doubts on the value of the OLPC venture needs to look up "the hole in the wall project". It shows that children unsupervised, with access to the internet, will learn on thier own. http://www.ncl.ac.uk/egwest/holeinthewall.html please pass this info on because for me once reading about the projects, made me a firm believer in the OLPC projects ability to be usefull to children and comunities

Chris, while some view this as a 'hole in the wall' I see it more as Pandoras Box.
I'd hate to have millions of children (unsupervised?) with access to the Internet. Like it or not, humanity has created Heaven and Hell electronically.
The only practical method of using OLPC laptops in schools is to have study curriculum stored on a school server and limit access (or none at all) to the Internet.
This can be graphically seen through First World schools and their attitude to internet usage. Many school campuses limit their firewalls to web pages and email. Of course a lot of the restrictions are due to usage of Windows and security problems. I would hope the OLPC laptop does not suffer from similar security holes. (Hackers love a challenge).

I'd like to see the first test run of laptops rigorously tested by people that really know how to test products.

30 Billion is a lot, but, if they only cost $100 to m,ake, why not sell them retail for $200? I'd pay that much for one. They could donate one to a kid every time someone buys a retail one. And, to kick things up a notch, why not just make plain "non-kiddie" one, geared more toward average techies and PC users, perhaps opn a separate, less-restricted "mesh" (ie. Adults don't wanna chat with 5 yr olds). I think it'd b the hottest gadget on the market, it might even generate $30 billion.

There are three distinct deployement scenarios, and most likely a few more will evolve over time, a) governments that borrow deep funds on behalf of their citizens to purchase 1 million OLPCs will want them locked down in classrooms much like how regular 1st world classrooms have evolved, b) OLPCs will find themselves donated directly to individuals who can use them anyway they see fit... and they may well be the only source of artificial light in some households at night, c) an unofficial hacker/nerd culture will evolve around the use and, perhaps grey or even black market, sale of the devices will abound, mainly in the 1st world. There is no single clean cut deployment scenario to debate the merits of.

As for a $30b/yr outlay by "the world on behalf of it's uneducated poor youth"... it's not going to happen. If the world was generally at peace, sure/maybe, but with oil about to run down over the next 50 years we are facing *MANY* grander problems than undecuated children. $30b/yr is only the very upper and most ideal level of international support. The overall project only has to reach a level of keeping the production costs below $150USD per unit to be successful and that is all the OLPC organisation needs to be concerned with.