Intel tactically donates a thousand laptops to Vietnam

In most situations, a donation of a thousand laptops is a pretty awesome thing. But when the donation comes from Intel, a multi-billion dollar corporation with an interest in promoting its low cost laptop line, and the recipient is Vietnam, a nation of 85 million living on less than $3,500 per capita, it'd be a long shot to say that the donation came out of the goodness of the company's heart. Education minister Nguyen Thien Nhan seems to be happy enough with the deal, saying that Vietnam recognizes the value of technology in the classroom (even if America doesn't). Frankly, we don't buy the PR line: it's not sustainable for Intel to constantly "give away" their machines, so the payoff is inevitably going to be some sort of lock-in by getting there first. Even if the concept of laptops in schools isn't flawed, this isn't the way to go about getting them into the hands of students -- let alone students from a country that is listed in the mid-hundreds on the GDP rankings.

[Via The Inquirer]

[Matt O @ Jun 11th 2007 3:43PM]

You have to be kidding me. They gave the Vietnamese a thousand FREE notebooks and you find a way to bash them for it. I don't see any other companies giving vietnam free notebooks. Sure there are other motives behind their action then them just wanting to help but it is still an amazingly nice move by them just for the fact that there will be a thousand happier vietnamese thanks to them. And last time i checked a thousand happier vietnamese are better than no happier vietnamese. sure giving away 85 million pcs would be great but its not realistic, stop being so NAIVE.

[Sam @ Jun 11th 2007 4:14PM]

I agree. Why did he feel the need to make this article so negative? What Intel did is a good thing, regardless of the motivation behind it.

[Dubb @ Jun 11th 2007 4:17PM]

You do realize there is another NON-PROFIT organization trying to get cheap laptops to under developed nations? A little thing called the OLPC. Engadget's problem with this is that Intel is a FOR PROFIT company, and is basically undercutting the great program that is the OLPC. I believe that is why their article is bashing Intel.

Intel has more to gain profit wise by getting in before the OLPC. If users like the Intel hardware, then they will buy Intel hardware in the future because of this experience. Where as the OLPC has little to gain because they offer no other products.

It's just sad on Intel's part, IMO.

[Dubb @ Jun 11th 2007 4:20PM]

Also, they have links throughout their whole article that explains why the post is negative. You really should read the linked articles, then you would understand why Engadget is negative.

[Dubb @ Jun 11th 2007 4:20PM]

Also, they have links throughout their whole article that explains why the post is negative. You really should read the linked articles, then you would understand why Engadget is negative.

[jorge @ Jun 11th 2007 4:19PM]

Someones a hater.

[npChaos @ Jun 11th 2007 5:23PM]

It matters little if the Intel has questionable motives about donating to a country that has 'little' economic value on a global scale. Even if it's just a marketing scheme, you guys are still talking about it, and in that sense they've accomplished what they might have set out to do.

I'm Vietnamese myself, and It doesn't bother me one bit that Intel might be using my homeland as a marketing ploy, the sooner Vietnam gets globalized, the better.

[Manfred @ Jun 11th 2007 5:31PM]

Intel is dumping. Dumping means using your money to crush competitors by selling below costs. By not turning a profit to drive out others out of a market. Intel is a sick donkey.

Their purpose is to undercut & destroy OLPC project. This behavior is illegal in the European Union. And they would have been fined.

They are getting away with it because they are doing it in Vietnam.

They can keep doing it. But my next laptop will not have an Intel CPU. And all next generation/batch of desktop replacements at my firm will be using AMD processors. My sanction according to my buying power.

[Dean Lowe @ Jun 11th 2007 5:32PM]

Oh please.... it's predatory pricing by a monopolist to kill off competition before it starts making it's usual 50% margins. Isn't that why AMD took them to court?

[sygyzy @ Jun 11th 2007 6:43PM]

I agree with the others. Why the bashing? I, for one, are happy to see what Dell is doing. Vietnam definitely can put the notebooks to use.

[David @ Jun 11th 2007 7:40PM]

So OLPC should really be ONILPC (One Non Intel Laptop Per Child). Apparently, it is okay to dump AMD processors on third world nations but not Intel processors.

[Basic @ Jun 11th 2007 8:21PM]

Seems to me that this is similar to Apple giving (and selling inexpensively) their machines to schools back in the early 80's.. trying to lock up a market... No reason to be negative.. even your favorite company does similar things.

[Gulic @ Jun 12th 2007 9:48AM]

The main objection, as I see it, comes from the fact that OLPC is a non-profit whereas intel is a for-profit company.

Economists have a notion that they call a "positive externality": an example of this that is normally given is returns from education. In a market with perfect competition, people would tend to under-invest in education, because they don't take account of the benefit that this investment provides for the economy as a whole. In this context, the market inefficiency could be rectified if the government provided a subsidy (i.e. public schools, vouches, whatever). More importantly for the current discussion, it could also be rectified if some NGO came in that provided the service at a subsidized price.

So the main argument against intel is that they are dumping right now in order to drive OLPC out of business. In the long run, they will set prices at profit maximizing rates, which could potentially lead to a lower than optimal supply because they won't be taking account of the positive externality caused by computer ownership. OLPC on the other hand, will have lower prices in the long-term because they are a non-profit, this could lead to a more extensive distribution of PCs to the needy.

What is a positive externality to computer ownership? For one, in developing countries teacher absenteeism and poor teacher quality are huge problems. Several studies by very reputable development economists have claimed to show that the computer assisted learning is effective in this context.

There are a lot of uncertainties in this argument, the biggest being that OLPC will actually manage in the long-run to provide PCs at below market prices. Just because OLPC is an NGO doesn't mean that it is well run. It could be that due to mismanagement, it can't offer the OLPC at a much better price than intel (when it is no longer dumping).

Still, it does seem pretty nasty on Intel's part to try to crush a non-profit. Also, apple might not be the best comparison in this case. Apple is also a for-profit company, so the winner of the competition didn't make much of a difference in the long run.

[ch @ Jun 12th 2007 12:37PM]

It's nice about Intel...But what make you think that any laptops will go to the people/students for free after they are in the hand of Vietnamese's official?

[D @ Jun 12th 2007 11:24PM]

Why the bashing and ill informed opinions in the article and the comments?

Intel has a chip plant in Vietnam. It has committed to increasing the size of the plant to the tune of a $1 billion USD capital investment. Any big corporate player is smart to be a nice corporate citizen in giving back to the community.

Folks here buy mainstream computers, not OLPC hardware. Intel is a major player simply because it is strong as an OEM. You can buy AMD, but Intel is a stronger brand name. In the airports, Intel provides free internet kiosks.

OLPC may work in the villages, but in the main cities, where the people with the money reside, folks buy the latest and greatest, to do what everyone does with computers - play games, download movies, etc. etc.

[engadget @ Jun 13th 2007 1:03PM]

"In the long run, they will set prices at profit maximizing rates, which could potentially lead to a lower than optimal supply because they won't be taking account of the positive externality caused by computer ownership."

Doesn't Intel sell their chips mostly to OEM companies who will compete with each other? AMD and VIA certainly aren't selling a lot of laptops in Vietnam right now, and they arn't going to until things improve, so I don't see the problem.

"Just because OLPC is an NGO doesn't mean that it is well run. It could be that due to mismanagement, it can't offer the OLPC at a much better price than intel (when it is no longer dumping)."

Correct. Intel has reasons to strive for superiority, olpc does not other then warm fuzzy feelings. Also,not for profit means pretty much nothing, their is 0 to stop OLPC from starting an "education" or "for profit" branch and capitalizing on their name. Also AMD who would be Intels competitor and IS a for-profit and would be gaining the same lockin.

Its silly to say that no one can compete with OLPC so that their is more competition.

[dougpy @ Jun 17th 2007 12:19PM]

It was clearly a PR move, and a case of dumping.