Will Nicholas Negroponte Ever Understand That Competition Isn't About Killing OLPC?

from the get-over-it dept

We've never quite understood Nicholas Negroponte's position when it comes to the $100 Laptop/OLPC/XO (whatever it's called these days). While the idea behind creating a super cheap, super durable useful computer for children in developing nations is good, Negroponte has always approached the idea as one where only he should be allowed to see that vision through. When other companies decided it might be a good idea and wanted to target that market themselves, Negroponte flipped out and started attacking them for trying to undermine his project.

Sorry, Nicholas, but competition isn't undermining.

In fact, competition is generally what drives all parties to be better at what they do, in order to fend off the competition. Yet, somehow, the UK's Times Online has bought into Negroponte's side of the story and written up an article bashing Microsoft and Intel for trying to "kill" the OLPC. The article is riddled with factual errors and opinion substituting as fact, but the worst is in the central point of the article. The author mistakes companies all aiming for the same market as a nefarious attempt to "kill off" Negroponte's pet project -- as if he has some universal right to the market that no one else can attempt to enter. It also brushes over some simple facts, like the one where many countries have looked at the OLPC and realized it doesn't really serve their needs just yet. That, if anything, should be even more reason why competition is necessary. It helps create better products that actually serve the needs of people in those markets, rather than just what Negroponte decides they must want in his top-down manner.


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    Truthseeker, Aug 11th, 2008 @ 10:54am

    Lets be fair

    Its NOT just another small "do good" organization trying to build a better mouse trap here. Its Microsoft and Intel who seem to have little interest in working with a group that had already been pioneering in this area for over a decade. It does seem a little strange?

     

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      Mike (profile), Aug 11th, 2008 @ 11:30am

      Re: Lets be fair

      Its NOT just another small "do good" organization trying to build a better mouse trap here. Its Microsoft and Intel who seem to have little interest in working with a group that had already been pioneering in this area for over a decade. It does seem a little strange?

      What seems strange? That Microsoft and Intel would feel they, with all their experience, might have a different take on how to approach these markets, and might realize that letting one guy set all the rules doesn't make sense?

      I don't see how that's strange.

       

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        Anonymous Coward, Aug 11th, 2008 @ 12:06pm

        Re: Re: Lets be fair

        It just seems strange that Microsoft (whos OS Mr Negroponte doesnt use) would unite with intel (whos chip architecture Mr Negroponte doesnt use) to work on a philanthropic project very similar to the one Mr Negropontes team has been working on for a decade now, yet never seek to consult or work with him or his team in anyway, seems a little strange. Offering an alternative in the marketplace can be a very beneficial thing, but so can truly uniting to solve a problem that the market just hasn’t taken care of yet (Healthcare in the US for example). It’s just slightly suspicious Microsoft and Intel chose the latter route (if their intentions really are largely altruistic here). Frankly I think it’s also a little suspicious that you give absolutely no credence to any questioning of motives regarding Microsoft and Intel here? I am not saying that I believe Microsoft and Intel are trying to kill Mr Negropontes project, but I am saying your seeming “shock” at the mere suggestion of such an idea, seems a little over done.

         

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          Anonymous Coward, Aug 11th, 2008 @ 2:31pm

          Re: Re: Re: Lets be fair

          Why would Microsofts and Intels intentions have to be "largely alturistic"?

          I guarantee that the intentions of Google (who is backing OLPC, per the story) are not altruistic. The more people online the more $$ for ads.

           

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      bruce, Aug 11th, 2008 @ 11:37am

      Re: Lets be fair

      Why does it have to be a "do good" organization? It should be about getting the right product into children's hands. Maybe if Negroponte would have spend a little more effort on creating software that would actually help educate, instead of put his effort into hand cranks and screen that let you see in bright light, then maybe the education ministers of the countries, he thought had agreed to buy millions, would have.

       

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      bruce, Aug 11th, 2008 @ 11:38am

      Re: Lets be fair

      Why does it have to be a "do good" organization? It should be about getting the right product into children's hands. Maybe if Negroponte would have spend a little more effort on creating software that would actually help educate, instead of put his effort into hand cranks and screen that let you see in bright light, then maybe the education ministers of the countries, he thought had agreed to buy millions, would have.

       

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        James, Aug 19th, 2008 @ 5:41pm

        Re: Re: Lets be fair

        Unfortunately, according to MS and Intel, "right" means "guaranteeing lock-in to MS software and Intel hardware."

         

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      Ben, Aug 11th, 2008 @ 1:15pm

      Re: Lets be fair

      It's not too strange if you think about two words: predatory pricing. Fearful of losing business, these big companies will do the same thing Wal-Mart has been sued over conutless times. They will offer a $100-$200 laptop that will put the OLPC to shame, taking an intentional loss to drive out competition. Then, 2 years later (after OLPC has sufficiently been destroyed), they will announce that particular model can no longer be manufactured for that price (I'm sure due to oil or silicon pricing or some other scapegoat). They will then come out with a "new" $100 model that will have all the computing power of your average calculator.

      Yes, predatory pricing violates antitrust laws, but if you saw the miniscule fines for such things you would die laughing.

       

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        dorpass, Aug 11th, 2008 @ 2:20pm

        Re: Re: Lets be fair

        Ben, in case you didn't notice, some of the latest TI calculators are far more advanced than any personal computer in the '80s and a generation of programmers grew up on those.

        Also, please do justify why Intel of all companies would feel threatened by OLPC competition in the lowest of low margin markets? In case you missed it, when people say "We'll make up for low margin in volume" they really rather not be. That is, it is not a market where money is made.

         

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          James, Aug 19th, 2008 @ 5:45pm

          Re: Re: Re: Lets be fair

          MS and Intel can't let any market escape; otherwise, others may realize that it's possible to do without them. Especially in this case, MS sees OLPC as a threat--lots of children managing to grow up computer literate without indoctrination into MS software--potential sources of competing products and Open Source software not tied to Windows.

           

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    Anonymous Coward, Aug 11th, 2008 @ 11:17am

    He is watching his meal ticket starting to swirl around the drain so of course he's crying foul.

     

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    Adam Wright, Aug 11th, 2008 @ 11:29am

    Subsidized laptop for developing Countries

    Negroponte wants a reasonable solution for developing countries who have little resources. Competition is great, but Negroponte wants to do it without having to require a subsidy. Thus, Linux (Sugar) and low cost CPUs from AMD provides a good basis for the project.

     

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      mobiGeek, Aug 11th, 2008 @ 11:51am

      Re: Subsidized laptop for developing Countries

      How does having competition in the space detract from that? Either the laptops have the capabilities and (overall) price point that the target audience wants...or they don't. The market will decide.

      If one company's product depends on subsidies (from where??), then that likely would take them out as a candidate for purchase by a government.

       

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        qhartman (profile), Aug 11th, 2008 @ 12:05pm

        Re: Re: Subsidized laptop for developing Countries

        If one company's product depends on subsidies (from where??), then that likely would take them out as a candidate for purchase by a government.

        They would theoretically be getting subsidized by MS or Intel. MS particularly has a long history of subsidizing PCs sold with Windows on them. That's part of what makes it possible for big manufacturers to sell PCs so inexpensively and still turn a profit. This is particularly true in the low-spec space that the OLPC would occupy. Just try to build a machine using OTS retail (or even OEM) parts and software. If you do a truly apples to apples build, your cost will be higher than buying that machine from a Dell or HP or similar reseller.

        This would be unlikely to have an impact on the suitability for a gov't purchase, there's no reason for it to, it's a common practice in the industry. The reason that OLPC had in interest in avoiding it is because it's dishonest; it's causes a difference between the actual and perceived cost of the machine. If I recall correctly, one of the long-term hopes of the OLPC program was to enable other groups to manufacture them, but if they couldn't do it for the same cost as the original because of the subsidies, this would be rather duplicitous.

         

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          mobiGeek, Aug 11th, 2008 @ 6:03pm

          Re: Re: Re: Subsidized laptop for developing Countries

          But I so completely understand what this magical "subsidies" gets anyone. If the gov't and the end users are getting equivalent machines for the same or less money, then they aren't losing out.

          If MS and Intel want to give money away to get these devices into customer hands instead of letting a Free alternative out there, then that sounds like a really bad business decision on their part.

          What is the "long game" for the subsidies play? Is it that they crush competition and hope to drive up prices in the long run? Selling expensive things to very poor people also doesn't sound like a savvy business plan.

          And then there's the assumption that potential customers won't take the potential future price increases into consideration of their current purchases.

           

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    qhartman (profile), Aug 11th, 2008 @ 11:30am

    Not Apples and Apples on either side

    Granted, the Times article was pretty one-sided and Negroponte comes off as an arrogant ass, but your take on it is pretty off too. On one side you have a non-profit organization that has been working on this for years, on the other you have two of the largest IT corps in the world, both who have a vested interest in seeing the OLPC fail, or at least substantially change how it's built.

    If the OLPC as it was originally envisioned is broadly successful, that would represent a major loss of mindshare for both MS and Intel in those developing markets.

    Further, how is the Intel or MS approach any less top-down? In the articles I've read, the supposed "needs" that are not being met are being defined largely by governmental bureaucrats, not the citizens and teachers who would actually be using the devices. Additionally, I've read some articles that made the claim that those same officials received some nice contributions from MS just before these needs got defined.

    All these accusations of attempting to kill the project or bribe officials aside, true or not, the situation creates the appearance of corporate interests having an undue influence on the technological development of developing nations, and people in positions of power making decisions for the wrong reasons. The whole situation smacks of corruption, even if it really is "fair" competition between an NPO and multi-billion dollar corps. Companies that were perfectly happy to ignore these markets until the OLPC started gaining traction.

     

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    Matt, Aug 11th, 2008 @ 11:46am

    deep down, I have a speculation

    I'm suspecting that somewhere in the process MS managed to bribe Negroponte to kill off OLPC....starting about a month or two before when he said "We need to be more like microsoft".

     

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    Anonymous Coward, Aug 11th, 2008 @ 11:54am

    "We've never quite understood Nicholas Negroponte's position when it comes to the $100 Laptop/OLPC/XO..."

    Generally we have always had clarity but Mike Maznick has always been prominently ignorant, but like to refer to himself as "we" and always taken that only he should get to have an opinion and everyone else should assume his ignorance as their own.

     

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      GeneralEmergency (profile), Aug 11th, 2008 @ 12:06pm

      Re:

      "Generally we have always had clarity..."

      Unfortunately, after attempting to read the rest of your sentence, I would argue to the contrary.

       

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      eleete, Aug 11th, 2008 @ 12:13pm

      Re:

      Speaking of ignorance, it's Masnick, not Maznick. Unless you're referring to someone else.

       

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        mightymaz, Aug 11th, 2008 @ 12:18pm

        Re: Re:

        Let me spell it out for you ignoramuses :

        "Generally we have always had clarity, but Mike Masnick has always been prominently ignorant. Mike also likes to refer to himself as "we" and always takes the view that only he should get to have an opinion and everyone else should assume his ignorance as their own."

        I'm sure you could have figured it out if only you had the idea to try !

         

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          Monica, Aug 11th, 2008 @ 12:38pm

          Re: Re: Re:

          "I'm sure you could have figured it out if only you had the idea to try !"

          Remember "Embrace and Extend"?

           

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      Mike (profile), Aug 11th, 2008 @ 12:40pm

      Re:

      but like to refer to himself as "we"

      Actually, the "we" referred to multiple posters at Techdirt. For example:

      Tim:
      http://www.techdirt.com/articles/20080321/114658614.shtml

      Joe:
      http://www.tech dirt.com/articles/20070521/083050.shtml

      Carlo:
      http://www.techdirt.com/articles/20070102/101128. shtml

      I think it would have been much more presumptuous to have included all of their opinions and said "I".

      So, while I appreciate your attempt to slam me for my use of "we," I would have to say in this instance, you are incorrect.

      always taken that only he should get to have an opinion

      Yes, that's why I leave the comments open, allowing anyone to post their own opinion and am willing to engage with them and respond to their differences of opinion.

      Obviously, it's because I believe only I get to have an opinion.

       

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    Joe Smith, Aug 11th, 2008 @ 12:08pm

    priorities

    These folks all need to get their priorities straight. OLPC makes no freaking sense for most of the poor children in this world. Money spent on OLPC could be better spent on good governance, education and safe water.

     

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      Anonymous Coward, Aug 11th, 2008 @ 12:14pm

      Re: priorities

      Thats true if your definition of better is more slavishly obeying the instructions of American business .

       

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      qhartman (profile), Aug 11th, 2008 @ 12:23pm

      Re: priorities

      I tend to agree with you, but the idea behind the OLPC and similar projects is to "attack the root of the problem", and by their definition the root of the problem is lack of education. The assumption being that, once better educated, these people will work to improve their situations on their own. I think there are some fundamental flaws in this argument, but hey, what do I know?

       

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      Iron Smith, Aug 11th, 2008 @ 2:33pm

      Re: priorities

      This project is about good governance, education and safe water, but not be handing it out to people, but by allowing them to learn on their own.Makes a lot of freaking sense, because they have their priorities right.

       

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    Anonymous Coward, Aug 11th, 2008 @ 12:27pm

    Now it's "good?"

    "While the idea behind creating a super cheap, super durable useful computer for children in developing nations is good..."

    I could be way off, as the previous author may have not been you Mike, but haven't you historically been an OLPC hater? Why the sudden change?

     

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      Mike (profile), Aug 11th, 2008 @ 1:48pm

      Re: Now it's "good?"

      I could be way off, as the previous author may have not been you Mike, but haven't you historically been an OLPC hater? Why the sudden change?

      Not a "hater." Just questioning the way the project is set up. The goals are certainly good. It's the execution we've questioned.

      Why do people always assume that when I question how things are done that I somehow "hate" those who are doing it. It's got nothing to do with hate.

       

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        Anonymous Coward, Aug 11th, 2008 @ 2:18pm

        Re: Re: Now it's "good?"

        Perhaps it's because you never phrase anything in the form of an intelligent questioning comment but always as an absolute ?

         

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    Anonimouse, Aug 11th, 2008 @ 12:29pm

    Re: Re: Re: Subsidized laptop for developing Countries

    "Just try to build a machine using OTS retail (or even OEM) parts and software. If you do a truly apples to apples build, your cost will be higher than buying that machine from a Dell or HP or similar reseller."

     

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    Anonymous Coward, Aug 11th, 2008 @ 12:37pm

    My own take on this has always been that Negroponte started off a good thing (ok maybe getting a laptop to people who probably need water and food more than anything isn't the *best* idea, but it's still a *good* idea and is better than nothing), and has been at it on his own for quite a bit. He's developed this idea of being the first there, and being seen as this good and caring character by everyone who benefits from it.
    Now the "big" companies are coming in with huge budgets and can probably reproduce his decades worth of work in a few years at most, and will probably be able to get the end product (the $100 laptop that people actually want) quicker than he can, and he's annoyed that someone will get there and get the recognition for it before he does.

    To be fair, I think anyone would be pissed off at it. But he's not being honest about his reasons.

     

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    Alien, Aug 11th, 2008 @ 12:48pm

    Cheapest laptop......

    India rocks!!

    http://timesofindia.indiatimes.com/Cities/Rs_1200_laptop_for_school_kids/articleshow/3347 183.cms

    Negroponte can shove his $100 (oops $200) laptop up his ass.

    BTW. Rs 1200 = $25-30

     

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    A. Coward, Aug 11th, 2008 @ 1:58pm

    Sue for...

    felony interference of a charity model

     

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    bobbknight, Aug 11th, 2008 @ 2:30pm

    Whats Missing FromThe Story

    Is
    The open collaborative nature of the olpc.
    MS and Intel are not 2 open groups, and I am sure that Intel is in this because of MS. OLPC in the long term would do damage to MS, so it has to fight it or lose out in the 3rd world.
    I mean this thing runs GNU/Linux MS has to hate it.

     

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    DS, Aug 11th, 2008 @ 2:39pm

    Here's where your wrong...

    Competition is not about killing OLPC, but it does kill Nick Neg's chance of being a savior that computerized poor countries. And really, that's what the whole thing is about.

     

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    Jeff, Aug 11th, 2008 @ 2:42pm

    The idea that competition is always good for society is also an opinion substituting as fact.

    Even Adam Smith, who originated the idea of the "invisible hand" never said that self-interested competition always led to the greater good, he just said that it sometimes did. And he specifically limited it to the case of smaller companies competing in a marketplace where none of them was large enough to distort the marketplace. Which is certainly not the case here, where two of the companies involved are pretty close to being monopolies.

    Being skeptical of the motives of Intel and Microsoft is a pretty reasonable reaction given both companies history of anti-competitive actions in the past.

    Sorry, Nicholas, but competition isn't undermining.

    In fact, competition is generally what drives all parties to be better at what they do, in order to fend off the competition. Yet, somehow, the UK's Times Online has bought into Negroponte's side of the story and written up an article bashing Microsoft and Intel for trying to "kill" the OLPC. The article is riddled with factual errors and opinion substituting as fact, but the worst is in the central point of the article. The author mistakes companies all aiming for the same market as a nefarious attempt to "kill off" Negroponte's pet project -- as if he has some universal right to the market that no one else can attempt to enter. It also brushes over some simple facts, like the one where many countries have looked at the OLPC and realized it doesn't really serve their needs just yet. That, if anything, should be even more reason why competition is necessary. It helps create better products that actually serve the needs of people in those markets, rather than just what Negroponte decides they must want in his top-down manner.

     

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      Mike (profile), Aug 11th, 2008 @ 6:12pm

      Re:

      The idea that competition is always good for society is also an opinion substituting as fact.

      No, it's pretty clearly opinion. This is an opinion site.

      Even Adam Smith, who originated the idea of the "invisible hand" never said that self-interested competition always led to the greater good, he just said that it sometimes did.

      Can you explain why it wouldn't in this situation?

      Clearly, various countries are not impressed by the OLPC as is. So what's wrong with competitors getting into the market?

      Being skeptical of the motives of Intel and Microsoft is a pretty reasonable reaction given both companies history of anti-competitive actions in the past.

      This isn't "being skeptical". This is accusing them of trying to kill a project for nefarious reasons with no evidence.

       

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        Anonymous Coward, Aug 12th, 2008 @ 7:46am

        Re: Re:

        The idea that competition is always good for society is also an opinion substituting as fact.

        No, it's pretty clearly opinion. This is an opinion site.


        It's not really expressed as an opinion, it's not defended in any way. It's more of a hidden assumption that I choose to challenge.

        Even Adam Smith, who originated the idea of the "invisible hand" never said that self-interested competition always led to the greater good, he just said that it sometimes did.

        Can you explain why it wouldn't in this situation?


        Obviously people who are not privy to the decision making process at Microsoft or Intel are not going to know exactly what process they are going through in making the decisions that they are making. That would certainly include me, and I am assuming that it would include you as well. The truth is that we just don't know why Microsoft and Intel decided to enter this market. You are assuming that they have decided that there is money to be made and that's a good enough reason. I'm not so sure, and the reason that I'm not so sure is that both of the companies that are involved are large enough to distort the markets they compete in.

        If they were just another small company, we could assume that they can't afford to give away products at way under cost to drive a competitor out of business, and then presumably raise prices. But they can afford to do this, and they have in the past.

        There are reasons that capitalism works. There are reasons that it doesn't work. I can't say for sure what it going on in this particular case, because I don't have any special insight into the strategies and motivations of the companies involved. But the fact that both of the companies involved are close to de facto monopolies causes me to be skeptical.

        I'm not going as far as Mr. Negroponte in accusing them of nefarious activities, but I am certainly willing to listen to his side of the story instead of considering him some kind of nutjob out of hand.

         

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    Charbax, Aug 11th, 2008 @ 3:47pm

    Intel is not competing fairly

    The worst part of it is Intel has been trash talking OLPC in all of the countries in which OLPC was going to be deployed. Not only has Intel been trash talking the OLPC, Intel representatives have even been threatening the different politicians in each of those countries. Or more blatant, Intel has been selling their classmate in low quantities at a loss.

    It's like if you are a multi-billion dollar company and I'm a 23-man startup. I make a really good product, but then to try to drive me out of business, you take your old market-leading product, sell a few thousand special versions at a loss to any of my potential customers, you offer them "free customer support" and stuff like that on top, and this way you are trying to delay my effective expansion with my product which is in fact much better and cheaper then your market leading product.

    Selling products at a loss to drive out competition is illegal. But since the sales are happening so far away, in palces like Nigeria and Lybia, I guess the courts in the western world don't have much they can do to stop Intel from using those types of practices.

    This is not competition, this is unfair competition.

     

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      Mike (profile), Aug 11th, 2008 @ 6:16pm

      Re: Intel is not competing fairly

      The worst part of it is Intel has been trash talking OLPC in all of the countries in which OLPC was going to be deployed.

      You mean explaining why they thought their product was better? How dare they!

      Not only has Intel been trash talking the OLPC, Intel representatives have even been threatening the different politicians in each of those countries.

      Do you have any proof of this?

      Or more blatant, Intel has been selling their classmate in low quantities at a loss.

      Um, wouldn't that mean that kids get laptops for even lower amounts? Isn't that the goal of this project? Or must the laptops come from Nick Neg?

      It's like if you are a multi-billion dollar company and I'm a 23-man startup. I make a really good product, but then to try to drive me out of business, you take your old market-leading product, sell a few thousand special versions at a loss to any of my potential customers, you offer them "free customer support" and stuff like that on top, and this way you are trying to delay my effective expansion with my product which is in fact much better and cheaper then your market leading product.

      For all the times people give this excuse, no one has ever pointed to an example where this strategy actually works. So after "dumping" then the big company tries to raise its prices back up and... bam... another opportunity for a cheaper provider to come in and supply the market.

      This is not competition, this is unfair competition.

      What exactly is "unfair" about it?

       

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        Bunny, Aug 11th, 2008 @ 7:35pm

        Re: Re: Intel is not competing fairly

        What exactly is "unfair" about it?

        If an intel rep came onto the board of YOUR company and was then assigned to all the travel to customer sites around the world and then, in a sales pitch told the local contacts NOT to buy your product, would that seem fair to you?

        Wouldn't that (in a worst-case scenario) possibly succeed in undoing all of your efforts and causing the project to flop and cause the people who donated to be less interested in participating in your next project? Were it a commercial venture, would your company's shareholders be happy with you as CEO and your board or would they find someone to sue to kingdom come as a result?

        It isn't a commercial situation, it's only a charitable work, but that was Negroponte's exact point, wasn't it?

         

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          mobiGeek, Aug 11th, 2008 @ 8:11pm

          Re: Re: Re: Intel is not competing fairly

          So the mistake was that OLPC put the wrong people on its board?

          How is this not Negroponte's mistake?

          Was it unethical of the Intel rep to get insight into sales opportunities? Likely, if the word-on-the-net holds the balance of truth. But that doesn't change the fact that potential customers changed their minds about which product to buy.

          And what is it that Intel has done to those potential customers other than pitch a better sale? How is this not standard competition? Did the Intel person lie about OLPC or about their own competitive offering? Did the Intel person make some kind of threat?

           

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            identicon
            Anonymous Coward, Aug 15th, 2008 @ 10:05pm

            Re: Re: Re: Re: Intel is not competing fairly

            How is this not Negroponte's mistake?

            I don't know whose mistake this was, perhaps Negroponte was too trusting of the intel people?

            Normally when a board for a major corporation assigns a task to one of its board members, a certain minimal amount of professionalism is expected, such as, for instance, doing the task that had been assigned! One would further expect the board members to abide by their agreements, one of the implied agreements being that if someone sits on the board of a corporation that that person is acting in favor of the corporation's investors. Negroponte can't be blamed for expecting people to behave according to established corporate norms, he can only be blamed for expecting corporate people to behave according to those norms outside of their corporate environment. Perhaps he should be blamed for thinking that intel wouldn't do everything it could to monopolize the market sector in question?

            Too see why it would have been hard to expect, if you hired a salesperson to sell cars, you would fully expect the salesperson to sell your cars as per your agreement with that salesperson. In exchange, if the salespeople do as they're supposed to, at a minimum, they get to keep selling cars. That much is in their interest. They may also get a bonus for being the top seller or employee of the month (good PR), sometimes the commissions are proportional to the sales, and there may be other perks. What you wouldn't expect is for the salespeople to drive all of the customers off to go buy a car at another lot across the street. A salesperson who did that in a commercial environment would not be thought of as "the standard" they would be dropped like a hot potato. In academia or in a charitable work you expect underhanded activity even less, and that's mainly because there's typically nothing to be gained from making your own project fail. Despite what you say, that it's the standard way of doing things, I don't think we're to that point yet in academia or most businesses.

            In a corporate setting I dare say this isn't exactly standard behavior either. If a corporate board member doesn't do an assigned task, that person is not fit to be on the board representing investors and will be kicked out. If that person not only doesn't do her job but betrays the investors' interests to a competitor, somebody might walk out of there in handcuffs. So it took some uncommon heart-pounding audacity for someone to act this way.

            Because this was only academia, and this was only a charitable work, the only people who could complain about unfairness are those who donated and who nearly saw their donation frittered away on a different purpose (that OLPC was making sales for a competitor, or for not following the promised educational vision for the project). Still, I think it may qualify as "monopoly abuse" if AMD (a major donor to the project) lost sales because of it.

            potential customers changed their minds about which product to buy

            So what's your point, that if a competitor monopolizes your sales force they are able to make some sales? I would sort of expect that. In fact, I would be surprised if they didn't make any sales at all (and they barely scraped together any interest).

            And what is it that Intel has done to those potential customers other than pitch a better sale?

            I wasn't arguing that it was unfair to the "customers" (whom you should really call beneficiaries. The children and their countries are beneficiaries of the charitable research & development and donated educational equipment.) I was arguing that it was unfair to the donors because their donations went to a different purpose than the lofty educational vision that was sold to them. It's like if you donate educational books to a child and you later find out that your donation allowed somebody to stick their own advertisements or drugs in the book. Maybe this is an extreme analogy but some donors would never have donated if they knew it would lose its purpose as being primarily educational and only secondarily to prepare the customer base for the true beneficiary.

             

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        identicon
        James, Aug 19th, 2008 @ 5:50pm

        Re: Re: Intel is not competing fairly

        Do yourself a favor; look up "path dependence." This is the equivalent of the drug pusher--the first one is free. After they have piled up software and documents bound to MS software, it is far harder to escape.

         

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    bigpicture, Aug 11th, 2008 @ 4:02pm

    Competition?

    Don't even call this journalism because it isn't. This subject has already been beat to death in just about every communication medium.

    MS and Intel do not want market penetration of their respective monopolies. The OLPC is about getting technology into the hands of the disadvantaged, not about mega profits. It is a charitable or not-for-profit operation if you will.

    That is entirely different from what Intel and MS is up to, which is not let anything else get market share, or even market awareness, even if this means giving their product away in this particular market at a loss.

    So where is the competition there? Where is the get the facts Journalism? What do you think the MS tactic is to compete against Open Source? How do you undercut free? Threat, intimidation and monopolistic contracts with the OEM PC installers. Anything but "free market" competition. How about some real "free market" journalism.

     

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      identicon
      dorpass, Aug 11th, 2008 @ 5:06pm

      Re: Competition? by littlepicture

      bigpicture, sooo.. you are complaining that Negroponte's goal is being met at a lower price? Awesome. I wish I could complain about things like that.

       

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      Mike (profile), Aug 11th, 2008 @ 6:19pm

      Re: Competition?

      MS and Intel do not want market penetration of their respective monopolies. The OLPC is about getting technology into the hands of the disadvantaged, not about mega profits. It is a charitable or not-for-profit operation if you will.

      So, you are saying that Intel and MS want to continue to lead their markets. No one denies that. But we're asking where the problem is.

      That is entirely different from what Intel and MS is up to, which is not let anything else get market share, or even market awareness, even if this means giving their product away in this particular market at a loss.

      Except that giving away products at a loss is not a sustainable business model anyway. Even if they "kill" the OLPC (which seems unlikely anyway), then what? Then Intel raises its prices? Well, darn, that just opens the market up for someone else to come in with a cheap product.

      You know who benefits from all this? The kids getting those cheap laptops.

      Where exactly is the problem?

      How do you undercut free?

      There are many, many ways to undercut free. If you don't know them, then you apparently don't read this site very often.

      How about some real "free market" journalism.

      Well, we're not a journalism site, so I'm not sure why you expect us to live up to your standard, but if you want to compete with us, go ahead. We won't accuse you of some nefarious plan to "kill" us.

       

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        PaulT (profile), Aug 12th, 2008 @ 12:29am

        Re: Re: Competition?

        "So, you are saying that Intel and MS want to continue to lead their markets. No one denies that. But we're asking where the problem is."

        I think the problem is that both of these companies have histories of shady and unfair tactics to obtain and maintain monopolies in their chosen market. They have a history of colluding with each other in order to force their products onto the least sophisticated consumer (and what consumers are less sophisticated than ones targetted here?).

        They are after mindshare - the next generation of Microsoft customers who won't be given exposure to alternative technologies. These people will not make a choice for themselves - they can't afford to shop around - and so we end up with another generation taught that MS = good, Linux = bad.

        That sounds like a doomsday scenario, but I can't think of any other reason. It's unlikely that either of these companies are interested in the charitable element of the project, and it's extremely unlikely that OLPC stands a hope of competing directly. It's not a free market if one company is able to destroy its competitors based on the influence it has in other markets. It's not a free market when dealing with monopolies (which both of these companies are).

        If the MS/Intel product is noticeably superior, and not being sold at a massive loss, it might be a free market. But, I've seen nothing that suggests either of these is true.

         

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        James, Aug 19th, 2008 @ 5:54pm

        Re: Re: Competition?

        OK, I'll bite. Would you consider any action to continue to lead a market justified? If not, where's the limit? Bribery? Murder?

         

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    identicon
    Paul, Aug 12th, 2008 @ 8:56am

    Try not to lie.

    Jeff wrote:

    "Even Adam Smith, who originated the idea of the "invisible hand" never said that self-interested competition always led to the greater good, he just said that it sometimes did."

    I call BS. Here's what Smith actually wrote in The Wealth of Nations:

    "By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good."

     

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    Ronald J Riley (profile), Aug 12th, 2008 @ 1:18pm

    If Only OLPC Had Patents

    Mike, I am sure that you personally and all the big companies who used and abused Nicholas Negroponte and One Laptop Per Child (OLPC) efforts to create affordable notebook computers are glad that he and his colleagues blazed the trail for parasitic companies.

    Mr. Negroponte has learned a lesson which every inventor understands, and that lesson is that in the absence of patents that transnational sharks will lie, cheat, and steal other's work. No patents equals no recourse!

    Now if Mr. Negroponte had used patents he could be suing these companies and funded his vision with the proceeds. As it is he and his vision will expire with a whimper. Transnational corporate public relations will flood media with their propaganda and in a mater of years he and his efforts will be mostly forgotten.

    Now if he had obtained patent protection and had the gall to hold these companies accountable for their predatory conduct they would be using their public relations people and all the shills and corporate stooges who operate on their behalf to paint Mr. Nicholas Negroponte as one of those mythical and vicious patent trolls. This is what they and YOU have been doing with the inventor community.

    The reality is that many of the companies who have shamelessly high jacked both the vision and the business using some truly despicable tactics of OLPC are members of the Coalition for Patent Fairness (better known as the Piracy Coalition). Their goals are nothing less than making the patent system a kings sport and ensuring that all of us are serfs obediently feeding their coffers.

    So tell me Mike, whose trough are you feeding from, or is the problem ignorance and having one's head stuck so far up where the daylight doesn't shine that you will never be capable of sorting out right from wrong?

    Ronald J. Riley,


    Speaking only on my own behalf.
    Affiliations:
    President - www.PIAUSA.org - RJR at PIAUSA.org
    Executive Director - www.InventorEd.org - RJR at InvEd.org
    Senior Fellow - www.patentPolicy.org
    President - Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (202) 318-1595 - 9 am to 9 pm EST.

     

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      Mike (profile), Aug 12th, 2008 @ 2:37pm

      Re: If Only OLPC Had Patents

      Mr. Negroponte has learned a lesson which every inventor understands, and that lesson is that in the absence of patents that transnational sharks will lie, cheat, and steal other's work. No patents equals no recourse!

      Hmm. I would think offering a better product in the marketplace and beating the competitors there is pretty good recourse.

      You don't?

      Now if Mr. Negroponte had used patents he could be suing these companies and funded his vision with the proceeds. As it is he and his vision will expire with a whimper. Transnational corporate public relations will flood media with their propaganda and in a mater of years he and his efforts will be mostly forgotten.

      Actually, apparently you haven't been paying attention, because OLPC is getting sued for patent infringement itself.

      Why aren't you accusing Negroponte of being a thief?

      Now if he had obtained patent protection and had the gall to hold these companies accountable for their predatory conduct they would be using their public relations people and all the shills and corporate stooges who operate on their behalf to paint Mr. Nicholas Negroponte as one of those mythical and vicious patent trolls.

      Interesting. So by *competing* by offering a totally different product, you believe that Intel and Microsoft somehow stole from Negroponte? Can you point to what they "stole" from Negroponte? I'm really curious.

      The reality is that many of the companies who have shamelessly high jacked both the vision and the business

      How do you hijack a vision? Isn't that just called competition?

      Why are you so anti-competition Ron? Afraid to compete?

      So tell me Mike, whose trough are you feeding from, or is the problem ignorance and having one's head stuck so far up where the daylight doesn't shine that you will never be capable of sorting out right from wrong?

      I've answered this question multiple times. I have nothing to hide. We do not receive any money for any public advocacy concerning the patent system or anything along those lines. Neither Intel nor Microsoft is a client of Techdirt and they never have been. So I'm not sure what point you think you're trying to make.

      You make accusations all the times and I've pointed out that you are wrong. Yet you insist on still making them. At this point I can only conclude that you enjoy lying.

      I would suggest an apology would be appropriate, but somehow I know it's not forthcoming. Instead, I'll expect baseless accusations and insults.

       

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        identicon
        Arnold Kempler, Sep 5th, 2008 @ 10:27am

        Ronald J. Riley Sued for Harrassing Internet Bloggers

        Mike,

        I thought you might find this interesting:

        September 05, 2008

        Dozier Internet Law: Ronald J. Riley and Inventored.org Sued

        Dozier Internet Law has filed a lawsuit in the Circuit Court of the County of Henrico, Virginia against Ronald J. Riley and a total of eleven of his businesses and fictitious names. In response to recent legal action by this law firm against Riley, he is attempting to convince the blogosphere that this lawsuit is an attack on his free speech rights. Just the opposite is true. Ronald J. Riley's misconduct includes his attacking bloggers and blog and forum moderators with threats of getting IP addresses of anonymous bloggers and then tracking them down. Ronald J. Riley is not at all what he seems to be.

        The Dozier Internet Law lawsuit resulted from a year long investigation of Ronald J. Riley and took us from interviews with Harvard Law School to Nobel Prize Winners. The discoveries about Mr. Riley along the way are troubling, and as he attempts to continue his attacks on his critics, a well rounded understanding of who Mr. Riley is and how he operates will be profoundly revealing and educational.

        Posted by Dozier Internet Law on September 05, 2008 at 07:16 AM in internet law | Permalink

         

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    icon
    Ronald J Riley (profile), Aug 12th, 2008 @ 5:36pm

    Mike Insults All Inventors

    "Actually, apparently you haven't been paying attention, because OLPC is getting sued for patent infringement itself."

    "Why aren't you accusing Negroponte of being a thief?"

    I am aware that he is the subject of one infringement claim. Meanwhile members of the Coalition for Patent Fairness & Piracy, aka the Piracy Coalition are collectively guilty of thousands of liberties with other's patent properties. They have been caught red handed with their sticky fingers in other's patent cookie jars. Their propaganda and your propaganda are virtually indistinguishable from each other.

    I think that Negroponte is an academic who was clueless about the shark infested business waters he wadded into. He was an idealistic and ignorant academic who shunned patents. He has now learned the hard way about the real purpose of patents. Patents protect young inventive companies from big predators. That is why those predators formed the Coalition for Patent Fairness. They want to set a standard of "fairness" where they can take what they want with impunity.

    "Why are you so anti-competition Ron? Afraid to compete?"

    I most certainly am not afraid to compete. The patent system is all about encouraging competition. It does so by encouraging a competitor to invent an alternative. If they can compete by producing their own inventions that is fine by me. What they should not be able to do is steal other's inventions for their own profit. If OLPC had been conducting it's business with an eye towards patent protection they would not today be on a path to expiring with a whimper!

    "So tell me Mike, whose trough are you feeding from, or is the problem ignorance and having one's head stuck so far up where the daylight doesn't shine that you will never be capable of sorting out right from wrong?"

    "I've answered this question multiple times. I have nothing to hide. We do not receive any money for any public advocacy concerning the patent system or anything along those lines. Neither Intel nor Microsoft is a client of TechDIRT and they never have been. So I'm not sure what point you think you're trying to make."

    Perhaps the point I am trying to make is that I have been in this business for many years and seen no end of sleazy tactics by patent thieves. You constantly deny any connection and they do the same. You and they both spew the same drivel. I know not to believe them, and I think that there is good reason to apply the policy to you.

    In any event, lets say that you are not a corporate stooge. I am willing to give you the benefit of the doubt and fall back to the second possibility that you have your head stuck someplace where you simply cannot see the truth.

    "You make accusations all the times and I've pointed out that you are wrong. Yet you insist on still making them. At this point I can only conclude that you enjoy lying."

    Mike, it is you who are constantly spewing rubbish about inventors and about the invention process. Now you may be lying or you may simply be hopelessly ignorant.

    "I would suggest an apology would be appropriate, but somehow I know it's not forthcoming. Instead, I'll expect baseless accusations and insults."

    Virtually all your writings about patents are baseless accusations and insults against all American inventors. Rather it is to your ignorance of the system or who is buttering your bread really does not matter. You are insulting us. That includes Nobel and Hall of Fame inventors.

    We know far more about the patent system than you ever will. We know more about the economics than you ever will. Yet you constantly come back with smart assed responses and then wonder why we disrespect you.

    Ronald J. Riley,


    Speaking only on my own behalf.
    Affiliations:
    President - www.PIAUSA.org - RJR at PIAUSA.org
    Executive Director - www.InventorEd.org - RJR at InvEd.org
    Senior Fellow - www.patentPolicy.org
    President - Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (202) 318-1595 - 9 am to 9 pm EST.

     

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      Mike (profile), Aug 12th, 2008 @ 6:02pm

      Re: Mike Insults All Inventors

      I am aware that he is the subject of one infringement claim.

      Right. So aren't they guilty of stealing? Or are you inconsistent in your condemnation

      Meanwhile members of the Coalition for Patent Fairness & Piracy, aka the Piracy Coalition are collectively guilty of thousands of liberties with other's patent properties.

      What does that have to do with anything? No one here has made any claims concerning patents other than you.

      And I note, with amusement, that you skipped over the question concerning just what these companies may have "stolen" from OLPC. As you are surely aware, their solution is entirely different than OLPCs.

      This has nothing to do with patents, but thanks for showing your ignorance.

      Their propaganda and your propaganda are virtually indistinguishable from each other.

      I'm assuming you mean companies who are pushing for patent reform. That's funny because as I've pointed out to you our positions are quite different. They supported the patent reform bill that went to Congress. I did not. They think that small changes can fix the patent system. I think we're better off throwing out the patent system entirely.

      Can you point to a single point we actually agree on?

      Or are you simply incapable of understanding these simple facts?

      I disagree with those companies and their position on patents. Might want to try getting that through your head.

      I think that Negroponte is an academic who was clueless about the shark infested business waters he wadded into.

      Hmm. Negroponte has been heavily involved in business operations before via the Media Lab. I think you underestimate Nick's experience.

      I most certainly am not afraid to compete. The patent system is all about encouraging competition. It does so by encouraging a competitor to invent an alternative.

      Well that shows a near total misunderstanding of how innovation and competition works -- but we've explained this to you. You have chosen not to understand because you personally profit from scaring inventors into supporting your "campaign."

      Anyway, you still haven't answered the question: how is what Intel is doing "infringing" on OLPC? It's a totally different product. It's competition. You haven't explained why it's not. I'm guessing because you have no answer.

      Typical.

      Perhaps the point I am trying to make is that I have been in this business for many years and seen no end of sleazy tactics by patent thieves.

      Again, you fail to explain why my views differ nearly completely with those firms.

      Funny. You fail to explain anything that shows you are wrong. I wonder why...

      In any event, lets say that you are not a corporate stooge. I am willing to give you the benefit of the doubt and fall back to the second possibility that you have your head stuck someplace where you simply cannot see the truth.

      Ah, there's the insult. I knew you'd go there sooner or later.

      Great formula: avoid the questions I asked. Don't add anything of substance and then accuse me of having my head up my ass.

      Very convincing.

      Virtually all your writings about patents are baseless accusations and insults against all American inventors.

      Really? You consider economic research by Nobel Prize winning economists "baseless"? You consider explaining to inventors how they can expand a market and make more money by eschewing patents "insults"?

      How?

      We know far more about the patent system than you ever will. We know more about the economics than you ever will.

      Ah, really? Then why is it that you seem to get the most basic facts wrong? Where is the economic research to counter the research I pointed to you? If you understand economics better than those Nobel prize winners, I'd love to see your economic research. It must be impressive.

      I'll be waiting patiently for your research. Or your apologies.

      But I'm guessing we'll be getting insults instead.

       

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    Ronald J Riley (profile), Aug 12th, 2008 @ 6:06pm

    On The Issue Of Competition - We won - You lost!

    Mike,

    Think about how inventors have been the wild card in the Patent Deform fight.

    You and the Coalition for Patent Fairness & Piracy both promote Patent Reform. Inventors oppose it.

    We are competing with each other. The proponents of Patent Deform have pulled every underhanded trick in the book to stack the legislative deck. Hearing are stacked to promote the biggest property rights grab ever seen in the history of our great country.

    The proponents of Patent Deform are serial transnational infringers. Washed up tech companies who are no loner capable for producing breakthrough inventions. Insurance and banking industries are their partnering in patent theft crimes. Their claim to inventive fame are endless excuses to deny legitimate claims and ever larger and more outrageous fees.

    Collectively they have been spending several hundred million dollars a year promoting Patent Deform.

    We have once again kicked their ass on the legislative front.

    I told you before that we would kill Patent Deform. It has now died in two sessions of Congress. How did that happen?

    One of the biggest reasons is growing cooperation between organized labor and the inventor community. We are working to create new jobs and tax base while patent pirating transnational's ship jobs and tax base to low wage countries. We are working to fix USPTO problems such as cleaning up incompetent and corrupt management, seeing that examiners are given the tools they need to do their jobs, given reasonable amounts of time to examine patents based on their complexity (currently they get 20.5 hours regardless of complexity. Working to address classic workplace labor issues.

    We will work to see that transnational's idea of free trade, as in free of all responsibility, becomes fair and equitable trade.

    We will build businesses which are based on mutual fair and equitable profit, ethical business which treats employees fairly.

    We will not be milking everyone to support profit without responsibility. It is long past time that large corporations are held to the same standards which we each hold people which we interact with.

    I am a diehard capitalist, but one who believes in ethics and morality. I have had it with crooks in the banking, insurance, and any other business which violates basic ethical standards for their and only their profit.

    So Mike, how do you explain that inspire of all your posturing we won and your side lost?

    Ronald J. Riley,


    Speaking only on my own behalf.
    Affiliations:
    President - www.PIAUSA.org - RJR at PIAUSA.org
    Executive Director - www.InventorEd.org - RJR at InvEd.org
    Senior Fellow - www.patentPolicy.org
    President - Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (202) 318-1595 - 9 am to 9 pm EST.

     

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      Mike (profile), Aug 13th, 2008 @ 3:20am

      Re: On The Issue Of Competition - We won - You lost!

      Think about how inventors have been the wild card in the Patent Deform fight.

      You and the Coalition for Patent Fairness & Piracy both promote Patent Reform. Inventors oppose it.


      Um. Ronald, how many times must I repeat this before it gets through your skull:

      I WAS AGAINST (AGAINST!) THE PATENT REFORM BILL.

      I've pointed that out repeatedly, even in the comment above that you are responding to.

      Yet, you claim I was for it. Stunning.

      You can read my original post when it was announced: http://www.techdirt.com/articles/20070418/161925.shtml

      I was and remained against it.

      So Mike, how do you explain that inspire of all your posturing we won and your side lost?

      How is it my side when I was against it?

      In the meantime, I will point out that, despite my repeated questioning, you have not responded to the point: what about what Intel or MS is doing violates anything patentable that OLPC did? You are refusing to answer this question because you know the answer is "absolutely nothing." They simply went after the same market with an entirely different product.

      And as you well know, offering a different product in the same market isn't violating a patent.

      Again, I'll ask you to apologize for getting your comments so incredibly wrong, but I (again) know that will never come.

       

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    Ronald J Riley (profile), Aug 12th, 2008 @ 6:18pm

    Who Believes Reasearch Would Sway Mike?

    "I'll be waiting patiently for your research. Or your apologies."

    "But I'm guessing we'll be getting insults instead."

    Mike, I have addressed this issue in the past. There is no point in my sticking any research in front of you because all you would do is spew more BS without regard to reality.

    And frankly, every time you open your mouth about patents you insult inventors.

    I am dealing with Nobel's who are inventors, you are citing Nobel's who are not inventors.

    Ronald J. Riley,


    Speaking only on my own behalf.
    Affiliations:
    President - www.PIAUSA.org - RJR at PIAUSA.org
    Executive Director - www.InventorEd.org - RJR at InvEd.org
    Senior Fellow - www.patentPolicy.org
    President - Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (202) 318-1595 - 9 am to 9 pm EST.

     

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      Mike (profile), Aug 13th, 2008 @ 3:37am

      Re: Who Believes Reasearch Would Sway Mike?

      Mike, I have addressed this issue in the past. There is no point in my sticking any research in front of you because all you would do is spew more BS without regard to reality.

      Huh? You won't present your research because you're afraid I'll respond to it? That's convincing. If my responses were really BS without regard to reality, that would easily be shown, so why would you fear presenting the research. The only reason to do so is either that you don't have any or you know it's weak.

      And frankly, every time you open your mouth about patents you insult inventors.

      Can you explain how trying to help them make more money and find larger markets is insulting? So far the only one spreading "insults" has been you, remember? You claimed I had my head up my ass. I think that's a rather direct insult. Whereas I'm explaining to inventors how to get a larger market.

      I'm confused how that's insulting.

      I am dealing with Nobel's who are inventors, you are citing Nobel's who are not inventors.

      We're talking about the economic impact of innovation here. I would think that you would want economic experts to do so. No?

       

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    identicon
    Charbax, Aug 12th, 2008 @ 7:25pm

    Kids aren't getting the laptops

    "" Or more blatant, Intel has been selling their
    "" classmate in low quantities at a loss.
    "
    " Um, wouldn't that mean that kids get laptops
    " for even lower amounts? Isn't that the goal
    " of this project? Or must the laptops come
    " from Nick Neg?
    " (...)
    " You know who benefits from all this? The kids
    " getting those cheap laptops.

    The kids are _not_ getting laptops, thanks to Intel's efforts in killing One Laptop Per Child efforts.

    Don't you understand it?

    Intel does not want kids to get laptops.

    Why would Intel have any interest giving $100 laptops to millions of children?

    Why would Intel be interested in loosing money on each sale of a laptop, why would Intel be interested in lowering the cost of laptops to children?

    Why would Intel be interested in supporting a movement into year-2000 type processors, ram, memory powering laptops not only for children in third world countries, but your next laptop and anyones next productivity laptop in the developed world.

    Don't you, Mike of tech dirt, understand that Intel and Microsoft have been feeding you people with one generation of bloatware after the other, keeping the price of laptops and PCs artificially high all these years? Haven't you seen how slugish, how slow Windows Vista runs, and all the BS they feed you people about having to buy faster processors, more ram, more memory to run the exact same programs you've had since the beginning of the Internet? (it's not like the browser have or need to change that much in terms of hardware requirements).

    Don't you understand Intel wants to STOP or DELAY any attempt at making expensive Intel processors irrelevant? And that Intel is going to do this even if that requires stopping millions of children in developping countries from accessing the Internet using different type of cheaper lower power laptops?

    Look at the facts, Intel CEO Craig Barret took a helicopter to meet the politicians in Nigeria, small talk with those, tell them to NOT buy any OLPC XO-1 laptop. Then Craig Barret proceeded to give 5'000 Classmates free of charge to the Nigerian officers, saying something like these are samples for them to test.

    Truth is, since then NOT ONE NIGERIAN CHILD has seen any other laptop. Intel has no plan to distribute 10s of millions of low power low cost laptops to Nigeria nor any other African country at below $100 per laptop or even below $200. If Intel sells laptops, just maybe, will they do it at $400, but only under the condition that $400 laptop has nothing to do with current lines of commercially available Intel based laptops.

    Look at the Intel Atom based netbook, it is limited at small form factors, cause Intel has no interest in $400 laptops having the same screen size and same form factor as Intel's preferred $1000 price point in laptops. Thus they do not allow any laptop manufacturer put a 15" screen on an Intel Atom based laptop, they do NOT allow any PCI-express connection, NO DVD drive allowed, hard drive capacity is limited. Exactly same requirements to use Windows XP, did you guys at Tech dirt not ready the announcement by Microsoft as for them setting up the conditions for laptop manufacturers being allowed to use Windows XP since June?

    And don't say that it is good that the children aren't getting laptops. Don't have that "Food or clothes or water is more important" argument. If that's you argument, then stop posting to your blog, since that would mean that you don't see anything positive or constructive in using the Internet.

     

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    Mark Beckford, Aug 13th, 2008 @ 1:26pm

    From the horse's mouth

    Wow, this subject really strikes a never. I may be the only one who can speak from the trenches of the war between Negroponte and Intel. I was GM of the business group at Intel the created the Classmate PC from 2005 to 2006. The internally politics at Intel eventually forced me to move out from what I thought was a dream job at the time.

    First, I mostly agree with Mike on his points, although I think the reason Negroponte is so perplexed by competition is

    1) that he created this as a non-profit so "how can for-profit companies have the gall, especially monopolists, compete with me."

    2) his ego. I write about this particular subject as my blog's first post so read more hear if you'd like. http://tinyurl.com/6etf9t

    But some myths put forth here:
    * Intel considers Negroponte a competitive threat as long as they use AMD's chips. Regardless of his non-profit status. And there is nothing wrong with that. Competition is good. Will make all the products better and cheaper.

    * Intel will not sell below cost. Unless they've changed their business practices recently, they run this as a business to make money, albeit at lower margins. The most powerful group at Intel is finance (margins rule at Intel), and i had my controller breathing down my neck all the time for revenue/profitability.

    * Intel would love to work with Negroponte, but until he uses Intel chips, they will compete hard.

    * While Negroponte's OLPC is a non-profit, it tries to act as a business. All of its partners in the supply chain aren't doing this for charity. And I think he'd be much more successful turning this into a for-profit company who's profits get plowed into R&D, innovation, etc. Keep it private and allow people at the company to maintain reasonable salaries to retain talent. He's already got the access. In my view this would focus him on running this like a real business and force him to get the operations, product development, marketing, sales etc. to a point that is sustainable.

    * Yes, Intel wants to keep chip prices high, but i know for a fact they know the economics of commoditization. Paul Otellini told his executives to deal with the fact that we are going to have disposable $100 PC's at some point. They will milk the margins as long as possible, and may limit the Classmate's success (they limited it when I was there to avoid sell-down), but they do want to get kids laptops at an affordable price that makes them money.

    * Have Intel and Microsoft pursued shady tactics? Maybe, I but I don't know from experience. I didn't nor promote it at all. We just had aggressive sales people who were just doing there job.

    I'll stop here ... there is a lot of pent up anger and angst against the big established players. A standard part of the business for the big guys like Intel, Microsoft, etc.

    It should all be about bringing the best product and the best price to market. Competition is good for everybody.

    Mark

     

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      Mike (profile), Aug 13th, 2008 @ 3:01pm

      Re: From the horse's mouth

      Wow, this subject really strikes a never. I may be the only one who can speak from the trenches of the war between Negroponte and Intel. I was GM of the business group at Intel the created the Classmate PC from 2005 to 2006. The internally politics at Intel eventually forced me to move out from what I thought was a dream job at the time.

      Hi Mark, thanks for chiming in. I can definitely identify with the "internal politics" issue at Intel -- though I remember part of their recruiting pitch years ago was that there was "no politics" at Intel thanks to the rise of "constructive confrontation." I always found that to be silly, and apparently it still is. :)

       

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        Mark, Aug 13th, 2008 @ 3:27pm

        Re: Re: From the horse's mouth

        Mike,

        I think any company has politics. But this one was especially heated because what we were trying to do with the Classmate PC and our other products was essentially create disruptive innovations (classic Innovator's Dilemma) ... products that could eventually save Intel and/or bring them huge growth, but in the short-term cannibalize their higher-end margin sales, which rubbed emotions the wrong way for those that were trying to protect the mainstream business. (Can't fault them completely for this).

        Another cultural philosophy at Intel was "disagree and commit." Lodge your disagreement but then go do it. It worked well mostly.

        But the political maneuver with our products was something I called "disagree and stall". I had to get the CEO to get the salesforce to sell the stuff, which he did, but in the end the sales guys just sat on it.

        But to be fair, from what I hear from the current GM and team, its a lot different now (i left at the end of 2006) and the saleforce is behind it.

        Mark

         

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    Ben Selinger, Aug 15th, 2008 @ 2:28pm

    Competition does NOT drive innovation

    Competition very rarely drives any technical innovation.
    Competition only ever drives innovation in marketing.

    An excellent, and simple example of this, is Intel's new Atom CPU. This 1.6GHz x86 processor, is Intel's answer (imho) to AMD's Geode LX/GX, and Via's Nemiah.
    Competition between companies, to produce ultra-low power consumption CPU's seems like a great idea, until you actually have to use one.
    By Intel's own (reluctant) admission, the Intel Atom 1.6GHz CPU runs 54% the speed of its predicessor, the CeleronM 900MHz (which can only really run 600MHz, so the 54% comparison is actually comparing to 600MHz), while using 80% the wattage. Do a little math, and you quickly realize that the Atom is using 160% the wattage, to attain the same amount of processing as the CeleronM. The CeleronM uses three to five times the amount of wattage to attain the same result as the AMD GeodeLX.

    Despite the math, Intel will certainly sell a lot of Atom CPU's. They are the result of competition, but not competition in technological innovation, but simply in marketing strategy.

    Intel was originally partnered with OLPC, but bailed the moment they realize OLPC would not install Intel CPU's in their machines, simply for the sake of politics. OLPC needed the best CPU for the job, and that happened to be the Geode LX800. Intel ditched, and released the ClassmatePC (which bombed). The classmate PC was a direct, competitive response to the XO, yet it couldn't compete in performance, power usage, functionality, nor durability.

    People bought the ClassmatePC instead of the XO, 100% due to political motivation, driven by sneaky marketing.

     

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    Sam Hiser, Sep 22nd, 2008 @ 4:06pm

    competition & OLPC

    This weak post reflects a failure to recognize that Intel and Microsoft were trying to derail OLPC without offering a meritorious alternative. Real competition would have been healthy for everyone.

    Now that Intel is using the Sugar OS on its patently weak Classmate PC and tens of thousands of XO laptops continue to roll out in Peru, the gossip about the past is irrelevant.

    Why is Microsoft's pilot of OLPC with WinXP in Peru? If they had honorable objectives about curing information barriers, they would be rolling out in other countries.

     

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  •  
    identicon
    Sam Hiser, Sep 22nd, 2008 @ 4:06pm

    competition & OLPC

    This weak post reflects a failure to recognize that Intel and Microsoft were trying to derail OLPC without offering a meritorious alternative. Real competition would have been healthy for everyone.

    Now that Intel is using the Sugar OS on its patently weak Classmate PC and tens of thousands of XO laptops continue to roll out in Peru, the gossip about the past is irrelevant.

    Why is Microsoft's pilot of OLPC with WinXP in Peru? If they had honorable objectives about curing information barriers, they would be rolling out in other countries.

     

    reply to this | link to this | view in chronology ]


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