IBM's Linux desktop price due to taxes, support

By John Lui, ZDNet Asia
Monday, June 09, 2003 09:46 AM

news analysis IBM's recently introduced Linux desktop is no low-cost computer for the masses, unlike Thailand's Linux notebook, because of import taxes and the cost of three years of hardware support.

IBM India also released more details about the Linux NetVista A30 desktop, which the firm said is the first desktop it is selling loaded with Redhat Linux 8.0.

The computer on offer features an Intel Pentium 4 processor, an integrated graphics chip, CD-ROM drive and a 15-inch monitor and costs 39,900 rupees or US$850, about 30 to 40 percent higher than a PC sold in other parts of Asia.

A check on IBM's India site shows that cheapest Windows XP-loaded NetVista A30 costs 41,990 rupees, or US$893. This is US$43 more expensive than its Linux counterpart.

However, IBM India feels that price comparisons between India and other countries is "not appropriate".

"It would not be appropriate to compare or convert this cost in U.S. dollars since this product is available only in the Indian market," Alok Ohrie, a vice president with IBM India's personal computing division told CNETAsia.

He also confirmed that IBM has no plans to sell the Linux PC in other parts of Asia.

According to an IBM statement, the desktop is aimed at business buyers in India's secondary cities, such as Lucknow, Patna, Raipur, Nagpur, Bhopal and Indore. Three years of hardware support would be provided by IBM with 90 days of phone support. Further support for operating system and software can be provided by Redhat through support packages the customer can buy.

Analysts have placed some blame on India's high federal and municipal tariffs for the high cost of PCs in the country and low rate of PC penetration. According analyst reports, the cost of PC is around two to three months salary for the average urban Indian, compared with the U.S. where the price of PC is about an average week's salary.

Among the schemes launched to bring down the cost of computing in the country is that launched by Taiwanese PC chipmaker VIA, which has partnered with an Indian institute to develop low-cost computers for villages and other rural areas.

The VIA Affordable Computing Lab at the Kunwal Rekhi School of Information Technology (KReSIT) at the Indian Institute of Technology (IIT) in Mumbai opened in April this year. It plans to develop, among other things, a low-cost, low power-consumption PC based on VIA's C3 processor, instead of pricier chips from mainstream makers such as Intel and AMD.

Analysts have also said that in the coming years, the Linux operating system will make more inroads in countries like India where there is a large pool of software engineers but with high tariffs on imported software and hardware.

Indian president A.P.J. Abdul Kalam in a recent speech said open-source software offers developing nations such as India the best opportunity to modernize.

"The most unfortunate thing is that India still seems to believe in proprietary solutions," he said in the speech. "Further spread of IT, which is influencing the daily life of individuals, would have a devastating effect on the lives of society due to any small shift in the business practice involving these proprietary solutions."


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