OLPC Cost Rises To $188 Per Laptop

Arathon writes "The amazing '$100 laptop' designed by the 'One Laptop Per Child' program isn't going to make it out the door for that price. CNN reports that the laptops are now expected to cost $188 apiece when they come out later this fall. This is expected to make the program's appeal potentially much smaller, since the developers were relying on the mind-bogglingly low-price to hook governments into the concept of buying laptops for their people. OLPC's spokesman guarantees that the price won't rise further, to 'above $190'. The price differential is being blamed on raw materials costs and currency fluctuation. Is this the end of the OLPC's newsworthiness, or should we continue to hope that it will make the difference that so many have said it will?"

Comments

Re:rehash

[Cafe Alpha]

I'm getting paranoid too, since the quality has dropped so much in the last few years.

Notice that complaints are all getting marked down?

We're being punished for noticing.

what is the REAL price?

[boomka]

Let's be economically realistic here. If you look at the OLPC progress timescale here:
http://laptop.org/en/vision/progress/index.shtml
You will notice that the price tag of 100$ per laptop initiates back in the end of 2004.

Now, I hope all of you here have heard about an economic phenomenon called inflation - the process where governments inflate money supply making your dollars buy less. Very few know that for the past decade or so the government has been massaging the official inflation numbers to make them appear lower - this allows them to make fewer and fewer payments on inflation adjusted liabilities such as social security. However, they still publish all the numbers one needs to calculate the actual inflation, and some people have been doing that, look for example here:
http://www.shadowstats.com/cgi-bin/sgs/data
Notice how inflation has been running steadily at about 10% for the last few years. Today, the engineers who drafted the 100$ plan in the end of 2004 / beginning of 2005, should expect the cost to be 100*1.1*1.1*1.1 or roughly 135 dollars.
That already would take a lot of sensationalism out of the story. However, let's not stop here. Remember, the real culprit behind inflation is the money supply, and consumer inflation is usually the latest to price rising party. The money supply (as you may have noticed from previous link) has been running at 14% annually, causing serious mischief in prices of things like energy (http://www.investmenttools.com/futures/energy/index.htm) or metals (http://www.investmenttools.com/futures/metals/welcome_to_the_page_about_copper_futures.htm) - both are important for making technology.
Just for the sake of an example, let's trivialize the problem a little, and say that to make a laptop you need to spend 60% of your budget on metals, and 40% on energy (it's wrong, but I am just making an example). What would you expect to happen to the price of such laptop according the charts I linked to? Well, it would go up from 100$ to slightly over 200$.

So what is the real story here, engineers screwing up their designs, or governments inflating away the buying power of the dollar making the same thing cost twice more over 3 years?
Look at my links, do your research, decide for yourself.