Computer makers chase '$100 laptop'

By Christian Science Monitor

The laptop computers most people haul around are underutilized. They hardly break a sweat to read e-mail, stream video, view photos, browse the Web or run word-processing and spreadsheet programs. Their powerful processors are rarely tested except by heavy-duty gamers, scientific researchers or other specialized users.

So while some PCs continue to bulk up and tout their speed and raw power, others represent a new trend: slimming down. Way down.

These smaller, simpler machines are aimed at a potentially lucrative market: the next 1 billion PC users around the planet.

• MSN Tech & Gadgets: The 10 most important laptops of all time

The market segment is so new it doesn't have a name yet or even an agreed-upon set of specifications. Intel (INTC, news, msgs), the chipmaker, calls the category "netbooks," recognizing that much of what people do on their laptops involves going on the Internet. The new machines are also being called ultra-low-cost PCs, mini-notebooks or even mobile Internet gadgets.

In appearance, they have the familiar clamshell design, but they're smaller, with seven- to 10-inch screens. They offer full keyboards (albeit with smaller keys) and weigh less than three pounds. Perhaps most important, the majority cost less than $500 -- some as little as $299.

Intel says it expects more than 50 million of these netbooks to be sold by 2011. It has introduced a tiny, low-power processor called Atom to run them, putting 47 million transistors on a chip about the size of a penny.

About 70% to 80% of tasks people do on computers today are online, says Uday Marty, the marketing director for Intel's netbook products. Intel has created the Classmate PC to show the potential market for students around the world. In Brazil, they're sold under the Postivo brand. In India, Intel partners with HCL Infosystems to produce them.

Asus, a computer manufacturer in Taiwan, burst out of the gate last fall with its Eee PC, priced at $299 (running on the Linux operating system) and $399 (with Windows XP). Hewlett-Packard (HPQ, news, msgs), Dell (DELL, news, msgs), Acer and others have similar machines in the works.

"There's a lot of potential for these products," says Michael Gartenberg, vice president and research director at Jupiter Research in New York.

Ultraportable computers have been around for more than a decade, he says. What's new is the low price, making them "attractive as perhaps a second or third computer for a household, or a primary computer for a student."

They represent the idea of the "ubiquitous computer -- the computer that you can have with you at all times," Gartenberg says. These micro-PCs are more likely to eat into laptop sales than threaten hand-held devices, including Web-enabled mobile phones.

For one thing, the mini-laptops have battery lives of only a few hours, not days, making them not yet ready to be "always on" companions.

"I really think the unknown dynamic is what happens when these $200 to $300 netbooks are unleashed in India and China and Indonesia," said Paul Otellini, president and CEO of Intel, in a recent conference call to industry analysts. "There is no model for that at this point in time because you are dealing with something that's never existed before."

Continued: A humanitarian effort

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