negative. And if you sold million and millions of [Classmates] the average margins would start to go way down, and that’s one of the things the analysts on Wall Street really don’t like. It just makes so much more sense to sell [processors] to us at your normal margin per processor and let us sell our laptop at no margin, and you win big.
In the end, we said “You’ve got to at least show some plan that you’re going to get out of building airplanes.” And they said, “You can’t believe that one size fits all,” and I said “No, of course not, there are many kinds of airplanes. But you shouldn’t be building them.”
X: Intel has said that one reason they decided they had to stay in this Classmate business was that they were already working with so many local manufacturers, they felt like they couldn’t pull the plug.
NN: We weren’t asking them to pull the plug. We never asked them to pull that plug. So when they ran off to sort of announce things, then you’ve got the stuff that they quit, that we didn’t want them to support anybody else, that’s rubbish. We may be hard to deal with, but we’re not crazy.
X: John Markoff said in his New York Times pieces that it was the lack of follow-through on Intel’s part on their agreement to back off on the really aggressive sales and marketing effort, even telling people in education ministries that the XO wasn’t going to work, that brought about the final split.
NN: Markoff got every single thing right, to the decimal point. It was chronic, it wasn’t just episodic. Something would happen one month and then something else. And very often I would get somebody from a government who said, “You know, this has just happened, but you can’t disclose my name.” Finally we got a couple of instances really thoroughly documented, basically transcripts, and then they said, “Oh yes, we’ll correct our ways.” But you know, it just didn’t happen. And it’s unfortunate.
X: What do you think is really going on at the core there? Are they such a genetically aggressive sales organization that they can’t help it? Or are they fundamentally bothered by the idea of a no-margin laptop, and they can’t let that happen?
NN: It’s two things. One you haven’t mentioned is probably the prime one, and that is that OLPC is caught in a proxy war between AMD and Intel that has nothing to do with us. It has to do with not allowing AMD to have a beachhead in those countries, period. Okay? And even though AMD has a tiny piece of the market—it’s some number like 15 percent—they are so focused on that 15 percent as a company. Instead of being happy with their 85 percent of the market, or whatever their number is, such a big piece, and have it be a growing market, they are really, really determined to—well, there is this genetic thing that is just to sell laptops and to destroy your competitors.
X: It seems natural for you now to go to AMD.
NN: We have. AMD has been a partner since day one. If you use time as the measure as well as money, they are our biggest sponsor.
X: Talking about the future—you’ve said it’s not about selling laptops.
NN: It’s not about selling laptops. It’s about leveraging the children themselves. Because if you look at the developing world, in general, education is more disciplinarian, more rote, more exam and test oriented, than it is in this country, or Europe or Korea or Japan. And if you look at education in the rural parts of the developing world it is even more, almost, totalitarian in the way schools are run. And one of the phenomena which just proves this, is if you go into a first grade class—especially at the beginning of whatever their academic year is—you see the kids with big, bright eyes. They are like sponges. By the third or fourth grade, their heads are down, they are just waiting to get out of the classroom.
Most people think that kids drop out of school in the developing world to go to work and earn money for their family or to work in the fields or to take care of the siblings or something like that. In fact, that happens—but the primary reason is that school is boring. It’s not relevant.
And so, to just bring IT into education really is just an automation of a system that, even if it works perfectly, with the best schools, the best teachers, the best facilities, all day lots of stuff, only has kids in the developing world in class for 13 hours a week. This is why we make it a requirement that the kids take the laptops home, that they own the laptops. It seems onerous to some countries, but if they don’t want the kids to own the laptop, we won’t do business with them.
X: Because you want to leverage the other 50 hours a week, or whatever it is.
NN: It’s even more than that. Because you want to have a seamlessness—not “this is education” and “this is the rest of life.” In the state of Maine, where they ran a laptop program for three or four years starting in 2001, there was software that swept the laptops every night. You couldn’t put music on them, you couldn’t use it everywhere you go. If you interview the kids in the state of Maine, they’ll say
