You’d think after a profit warning pounded its stock today (losing 12%), that Intel would be looking for ways to get some good press. Not so. Not unless sticking it to the world’s poor children is considered good press.
MIT’s Nicholas Negroponte has created the One Laptop Per Child initiative which seeks to put an inexpensive computer into the hands of some of the world’s poorest children. The initiative hasn’t been without controversy. A competing project claimed One Laptop was TOO technologically sophisticated for its purpose, and that the former provided a better alternative by having a battery that could be recharged by manual labor.
One Laptop has also faced mistrust from the big-time computer companies who believe they actually have a potential market among the world’s poor countries:
The project has been a lightning rod for controversy largely because the world’s most powerful software and chip making companies — Microsoft and Intel — had long resisted the project, for fear, according to many industry executives, that it would compete in markets they hoped to develop.
As a result, One Laptop’s XO computer comes with a processor built by Intel’s rival Advanced Micro Devices and open-source software, rather than Microsoft’s Windows and Office software.
This is something akin to the drug companies refusing to provide low-cost AIDS treatment drugs to African countries because it would eat into their profit statements and potentially harm their patents. How low can you go?
At one time, Intel was reluctantly on board the laptop project. But that ended this week:
After several years of publicly attacking the XO [laptop initiative], Intel reversed itself over the summer and joined the organization’s board, agreeing to make an $18 million contribution and begin developing an Intel-based version of the computer.
Although Intel made an initial $6 million payment to One Laptop, the partnership was troubled from the outset as Intel sales representatives in the field competed actively against the $200 One Laptop machine by trying to sell a rival computer, a more costly Classmate PC.
The Classmate sells for about $350 with an installed version of Microsoft Office, and Intel is selling the machine through an array of sales organizations outside the United States.
So get this: Intel wants to sell a laptop to the world’s poorest that is nearly 100% more expensive than the alternative. And because its salespeople in these poor countries see dollar signs in potential contracts slipping through their fingers if the One Laptop project succeeds, the salespeople sabotage the initiative and Intel signs off on this behavior. To paraphrase the gospel phrase: say “for shame” somebody.
Here’s how Intel explained its desertion of the project:
Chuck Mulloy, an Intel spokesman, reiterated the company’s statement that Intel had decided to leave the organization after it reached a stalemate over whether the chip maker could continue to promote the Classmate [the Intel laptop alternative].
“Our position continues to be that at the core of this is a philosophical impasse about how the market gets served,” he said.
That’s right. Should Intel be allowed to market its gold-plated laptop to the world’s poor while feebly claiming to support an alternative that would be cheaper and help more people? You can’t have it both ways though you sure have to hand it to Intel for trying.
So even though Christmas is past, let’s say bah-humbug to Intel’s Scrooge and buy a laptop for a child today.