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So why hasnt this happened sooner?
Simple. PC makers couldnt afford itat least not until now. Ironic that while the basic costs and capacities of everything from MP3 players to digital cameras have dropped, were only now getting a bit of real computing power trickle-down into the sub-$300 realm.
Is there a market? I think so. Ive talked to a number of people on fixed or low incomesstudents, retirees, freelancers, people stuck paying off debts with bad creditand all of them loved the idea. Simple was fine: they just wanted something they could use to browse the Web, do word processing, answer email in short, do all of the basic, untaxing things the vast majority of people do with computers in the first place.
So how come we havent seen a $300-ish notebook sooner? There are three basic reasons:
1) Profit margins on hardware are thin enough that to make something for that little virtually guarantees you will lose money. Desktop PC manufacturers make barely a few dollars per machines as is; this is why they push hard to also sell additional hardware (printers, scanners), software (security or office apps), maintenance and service plans.
2) Of the people who do have the money to shell out for a full-featured notebook PC, more of them are buying notebooks as potential replacement desktop machines, which automatically pushes up baseline expectations for what a notebook should be. The lowest-end Dell notebook available as of this writing, for instance, starts at $499 (a low, low $15 a month if you qualify for financing) with 512MB of RAM, a 60GB HD, and a 256MB video card. These are the specs for a decent starter desktop machine, but theyre still total overkill for someone with more modest needsand for some people, the difference between over $500 and $300 is make or break.
3) You get what you pay for. This definitely applies to electronics, where a higher price can be applied back into research and development, QC, and all the other things that make something worth buying at any price. A lower price almost inevitably means poorer materials or workmanship, less thorough QC, or any number of other corners being cut.
Next page: Why cheap notebooks are on the way
At the same time, a number of other things have come into the picture to make the $300 notebook that much more feasible:
1) The broader acceptance of free and open-source software. ASUS was able to shave quite a bit off the price of each Eee PC by loading it with the Linux operating system and open-source software (such as OpenOffice) that costs them almost nothing to provide. Windows licenses are not cheap, and most PC makers attempt to offset the cost of Windows by, again, offering add-ons.
2) Cheaper solid-state storage, which is speedy and enhances battery life. Flash memory has finally fallen to prices where the amount of space youd need for an actual notebook PC (4-8GB) is affordable. The 2GB card I bought for my camera the other month cost a mere $15; I imagine the prices are much cheaper for manufacturers buying in bulk.
3) Other cost-cutting measures that dont affect quality as broadly. VIAs own NanoBook uses not only VIAs own C7-M processor, but VIAs North and South Bridge chipsets, their audio components, and their portable graphics subsystem. They build enough of the pieces themselves; why not use them together?
4) Public pressure. Now that people see something like the OLPC is possible, they wonder why something like that cant be offered in a more commercial vein as well. The XOGiving site indicates that you can send one laptop to someone for $200, which means $300 isnt an impossible target to aim for.
I wonder, however, if the fact that all of this has emerged now is reflective of the bucking of a long-time trend. For too long, the economics of the industry have rewarded companies who stay current with technology rather than providing truly affordable computing power. A couple of years back I wrote a column for PC Today where I lamented the gigaflops-and-gigahertz-at-any-cost mentality. Weve been trying to make things faster and more powerful, and in doing so neglected whole classes of folks who didnt need faster or more powerful. They needed something that worked, with nothing fancyalthough I admit that depended on your definition of fancy. For example, these days wireless could be considered strongly required and not a frill.
Providing what just works, rather than staying with whats current, has at least some precedent elsewhere. Consider Japans Mujirushi, a chain store with a house brand that embraces unpretentious simplicity as a cost-cutting measure. They were profiled recently in Slate, and the article described how their frugality worked in their favor as a brand unto itself. They sell U-shaped spaghettipasta without the ends trimmed, as they normally are during manufacturingand potato chips that may look weird but are at least as tasty as the real thing.
Theres a lesson here. Im now looking forward not to whatever Apple has up its sleeve for the next generation of the iPhonewhich is guaranteed to be overpriced and vendor-locked, anywaybut machines that are cheap, simple and casually nondescript, and still do everything you need. Its hard to see how that can go wrong.