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$30 Cell Phones, $100 Computer, Muffin Stumps
Earlier this year Motorola began shipping $40 Cell Phones and expects to begin shipping $30 phones in the first quarter of 2006. Anecdotaly, I hear that these phones are being perceived as to be of very low quality and that is holding back sales. Status and 'perceived price' are key criteria in end user's purchasing decisions.
The very same issue faces the "100 dollar computer" movement and I think that Michael Robinson does a good job of articulating this and drawing some parallels to the muffin tops that Elaine tried to pawn off to the homeless in a now infamous Seinfeld episode.
Check out http://michaelrobertson.com/archive.php?minute_id=170
Does anyone have any on the ground feedback on how well these $40 phones are actually doing in the market?
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I recently saw Negroponte's presentaion on the MIT $100 laptop initiative and was quite impressed...
A quote from my friend Dina Mehta - http://radio.weblogs.com/0121664/
Nicholas Negroponte, professor at MIT and founder-chairman of the Media Labs on the $100 laptop project. 23 years ago, they tried computerising schools in Senegal - but it didn't work. In Costa Rica (3.5 mn people) however, it has been really successful - the poster child for the MIT Media Lab. He got involved in sending used computers to Cambodia. This stopped ... and instead they started building schools and not just sending used computers. Satellite connections were put in, laptops were set up, generators were set up. Kids started taking their laptops home and parents loved it, because suddenly they had a source of light (no electricity otherwise). The first English word many of them spoke was Google!
Today's laptops are so loaded ... he takes us back to the old days when they were so quick, so easy and so reliable to use. His question - do we really need it. Some things to reduce cost - remove colour mode on the LCD screen and use B&W with high resolution, or low res colours. Has to be on a very low power budget - below 2 watts. E-books must be below 1 watt.
They needed scale - not as much to take down costs - but to change the strategic plan in companies offering the service --- when he told them he needed 100 million chips - the company making the chips did an about-turn on their initial hesitation that it doesn't meet their business strategy.
November 16, 2005 is when it will be shown at the Vatican for the first time.
Wow. I hope they have India in their roll-out plans.
The most interesting thing I heard from him was that 35% - 50% of the cost of your laptop goes for marketing and distribution...just getting rid of that (given their model to go through Gov't agencies en masse) is huge step in and of itself. In addition, power by hand crank, impressive screen design (another 20% - 30% of the price) and OWNERSHIP by the kids...these are heady times.
http://laptop.media.mit.edu/faq.html