Microsoft Seeks Alternatives to Low-cost Laptops

Microsoft is looking at alternatives to ultra-low-cost laptops in the drive to arm people in developing nations with a way to communicate and access the Internet, and the company is turning its sights on cheaper devices that can give people a start in computing, such as smartphones and shared computing.

The world's largest software maker has a few projects in the making, including a push to use mobile phones in computing and microfinance. Mobile phones have already made an impact in nations across the developing world, from India to Zimbabwe, enabling people such as farmers and fishermen to find better markets and prices. Handsets also give a person a way to be reached for jobs.

"Technologies like the mobile phone promise to take things like very small loans, microfinance, and allow them to operate in a very efficient infrastructure so that the price and the availability of financial products can be far broader, reaching out to everyone in society," said Bill Gates, chairman of Microsoft, in a speech at the Jakarta Convention Center last week. "We haven't achieved that yet, but that's an area where Microsoft and my foundation are working on and investing very heavily."

Microfinance is important because people in developing nations don't often have access to loans, and when they do, they face interest rates as high as 20 percent to 30 percent a day to loan sharks. The microfinance trend was made famous by Grameen Bank in Bangladesh.

Identity and billing are benefits of tying mobile phones to finance products. A mobile phone provides an identity, and cellular network operators can be part of the microfinance process through their billing processes.

One of the reasons companies are looking more to mobile phones for developing nations is because of the huge number of handset users worldwide, estimated at 3 billion, and widespread network coverage. Nearly 90 percent of the global population is covered by a mobile phone network, according to information from the GSM Association and CDMA Development Group.

Handsets are so popular in developing nations that those countries are finding novel ways to use the technology. For example, in Indonesia, a nation of 230 million people spread across 17,000 islands, the government has started allowing certain services and bill payments over mobile phones. The president of the country even set up a mobile phone number, 9949, so people can SMS (short message service) to communicate directly with him.

"I was immediately buried in an avalanche of messages telling me what to do to solve the nation's problems and also scores of SMSes containing personal, including marital, problems. But my office has been able to cope very well," said Indonesian President Susilo Bambang Yudhoyono in a speech.

Microsoft is looking at ways to hook smartphones up to TVs to use the computing power and connectivity of the handset with the larger screen of the TV for a better, and cheaper, Internet experience in the developing world. The company began working on Fone+ a few years ago, and has tested prototypes proving such devices can lower the cost of computing for the poor.

The company still says ultra-low-cost laptop PCs (ULCPCs) have an important role to play, but such devices are still expensive for developing nations, according to Craig Mundie, Microsoft's chief research and strategy officer, and the head of its Unlimited Potential Group, which works on projects for the poor.

"We would love to see an environment where every kid has their own laptop, and that is the long-term outcome that you ultimately want to strive for," he said in a recent interview. "But we're also realistic, given the number of kids that don't have anything today, that it's going to be a big lift for governments around the world to figure out how they'd buy even a [US]$200 device for every kid."

That's why the company is working on projects such as Fone+ and MultiPoint, a technology where each student has his or her own mouse and unique cursor to use the same computer. That drops the price of computing dramatically, to one PC, a projector and 30 computer mice per classroom, instead of $200 per laptop.

"You have the opportunity to introduce the computer into the curriculum for every class there," he said. "Now that's not as good as every kid having their own laptop, and they don't get to take it home with them, which is a big loss, but it gets them started."

The idea of using ULCPCs as a way to bring computing to students in developing countries began with the One Laptop Per Child Foundation's (OLPC) $188 notebook. The XO originally started with an Open Source OS, but OLPC has worked with Microsoft on using XP, and Microsoft has dropped the price of a suite of Office software for such devices.

The fact that Microsoft and so many other organizations are concerned about bringing computing to the developing world is comforting to some people. The fear is that modern countries with access to IT and the Internet will continue to expand the gap in technological know-how over developing nations, a conundrum commonly referred to as the digital divide.

"With ICT, we now have the most potent weapon of all to break the vicious cycle of poverty and ignorance," said Yudhoyono, adding a warning: "Whether we like it or not, there is a digital divide. The gap is widening between the information technology 'haves' and 'have-nots.' There is a real danger that the world's poor will be virtually excluded from the emerging knowledge-based global economy -- with dire consequences to global peace and security."