OLPC laptop costs $175
On Thursday The One Laptop Per Child (OLPC) group announced that it had raised the price for its hundred-dollar laptop to US$175.
"We are at the most critical stage of OLPC's life," said OLPC founder Nicholas Negroponte . "A year and a half ago, we were selling a dream, but it's easy to sell dreams if you're passionate and can share that passion with other people. But that was dreams, and now we've got to launch. We need three million units to trigger the supply chain."
OLPC has distributed about 200 beta versions of its XO laptop to each of the seven countries that have committed to making bulk orders so far: Brazil, Argentina, Uruguay, Nigeria, Libya, Pakistan and Thailand.
Once they reach that volume production, the price will soon begin to fall again, since OLPC is a non-profit organization and has recently struck a deal with Citigroup Inc.'s Citibank to handle the administrative side of the business, Negroponte said.
"The manufacturing cost of these laptops is $175. We'll charge maybe $176 to cover the cost of these offices. Usually 50 percent of the cost of a laptop is sales and marketing, distribution and profit, but we don't have any of those things," he said. He also pledged that OLPC would readjust the price every business quarter, leading it to drop about 25 percent within a year.
In contrast, OLPC designers will keep the XO design trim, holding its average power consumption between 2 watts and 4 watts. Instead of selling more expensive PCs, the group's business model relies on large scale sales, rising from 3 million to 5 million units produced in 2007 to a range of 50 million to 150 million in 2008.
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