China’s Cheap PC Plans

[via Bala] Asia Times writes:

Culturecom Holdings Ltd says its new V-Dragon CPU, which retails for only US$15-$30, will reduce the price of PCs and appliances by anywhere from 50-70 percent, mostly by eliminating costly intellectual-property (IP) fees charged by “Wintel” – Microsoft and Intel – for their operating systems and CPUs.

Co-developed by IBM and based on the Midori Linux operating system, the new V-Dragon architecture aims specifically for the Greater China market with an embedded dynamic Chinese character-generating engine, allowing direct use of 32,000 Chinese characters without additional font sets or Chinese language peripherals.

“The V-Dragon is not only the first Chinese CPU, its also the first Linux-based CPU,” Culturecom senior vice president Benjamin Lau told Asia Times Online. “Midori Linux is a flexible OS [operating system], and it’s the only Linux OS whose design team was led by [Linux creator] Linus Torvalds himself,” Lau added. Culturecom acquired rights to Midori Linux from the US-base company Transmeta.

Lau said that Culturecom forecasts shipments this year of between 1.5 million and 2 million units. Most are for intelligent appliances (IA) such as smart digital video disc (DVD) players, or for special-purpose terminals such as the tax terminals Chinese equipment vendor Datang is building, and for which it has ordered 300,000 V-Dragon CPUs.

Critics have suggested that the Chinese CPU’s speed is prohibitively slow, but Lau disagrees. “The V-Dragon CPU offers speeds anywhere from 400 megahertz to 1.4 gigahertz,” Lau told Asia Times Online. “For Datang’s tax terminals, for example, they only need 400MHz processors. Some of our customers want faster CPUs, and we can meet that need.”

In a market where PC penetration remains extremely low – 3.3 million PCs were sold in 2003 in a country with a population of 1.3 billion – Culturecom is hoping that its low-cost CPUs will help to bridge the gaping “digital divide”. Simple desktop computers powered by V-Dragon CPUs and sufficient to browse the Internet would cost as little as $200.

“We can serve the mass population of China,” said Lau. “The vast rural population desperately needs access to affordable IT.”

Rather than trying to make desktops, they should looks at making thin clients based around the chip. What’s needed is a redefinition of the architecture given the presence of networks.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.