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Intel, One Laptop Per Child Program Make Peace

The nonprofit that aims to seed the developing world with inexpensive laptop computers for schoolchildren has made peace with Intel Corp. (INTC), the project's most powerful rival.

The One Laptop Per Child program and Intel said Friday that the chip maker would join the board of the nonprofit and contribute funding.

The nonprofit effort — known as the "$100 laptop" because of the low price it hopes to reach with mass production — has been trying to line up governments in several countries to buy the machines, which for now cost $175.

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But Intel has been an obstacle. Its chairman, Craig Barrett, derided the "XO" machine from One Laptop Per Child as a mere "gadget." And Intel recently began selling its own child-focused Classmate PC, which is a more conventional machine than the radically rethought XO computers.

The Classmate costs around $225, and Intel expects that to fall near $200 this year. Intel has deals in Pakistan, Brazil, Mexico and Nigeria, spokeswoman Agnes Kwan said.

Under their new partnership, Intel and One Laptop Per Child might seek ways to package their computers together for overseas governments.

For example, Intel's Classmate, which has to be plugged in, might be an option for urban settings, while the XO laptops, which use very little power and can be mechanically recharged by hand, could go into rural districts.

"There are an awful lot of educational scenarios between K and 12," said William Swope, Intel's director of corporate affairs. "We don't think all those are going to be served by any one form factor, by any one technology, by any one product."

Walter Bender, who oversees software and content for One Laptop Per Child, said the biggest benefit for his group would be Intel's work with the project on future technical developments. That will deepen the pool of software and hardware designers available to perfect the XO machines.

"It's a big problem, more than 15 people at OLPC can do all by themselves," Bender said. "Getting more talent lined up to help us is only a plus."

At least the initial wave of XO computers, expected to reach developing countries this autumn, will continue to use processors from Intel rival Advanced Micro Devices Inc (AMD).

AMD has been a major partner in One Laptop Per Child, along with such other big names as Google Inc. (GOOG), News Corp. (NWS) and Red Hat Inc. (RHT)

AMD said in a statement that "Intel's apparent change of heart is welcome, and we're sure they can make a positive contribution to this very worthy project for the benefit of children all over the world."

But without a doubt, Intel would love to oust AMD as the chip supplier. Although Swope said "philanthropy is the reason" for the partnership announced Friday with One Laptop Per Child, he also said: "We're going to go compete for the XO business, because we think we build first-class silicon."

Although several countries have expressed interest in the $175 laptop, One Laptop Per Child's leaders have backed away from predicting which governments will be first to officially sign contracts to buy the machines.

The project needs orders for 3 million laptops so its low-cost supply chain can get cranked up.

"We're definitely going to be doing stuff in South America, Africa and Asia right from the very beginning," Bender said Friday.

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