Via readies $250 PC

The Terra PC is a reference design created by Via that will be licensed to PC makers around the world. The company will show off prototypes at the Computex trade show in Taipei next month, and systems are likely to hit the shelves in different markets worldwide by September or October, said Ravi Pradhan, Via's manager for India.

		Related story Ballmer: We need a $100 PC "We have to engineer (PCs) to be lighter and cheaper," the Microsoft chief says.

The proposed price for the Terra, which includes a monitor, is achieved by picking components with cost in mind. The system, for instance, will run an older 1GHz processor from Via, Pradhan said. It will also come with 128MB of memory, about one-quarter the amount found on typical desktops these days, and a small drive.

Via is also tinkering with the idea of selling a PC that uses the TV as a monitor, but this concept has been a tough sell in the past. The chipmaker, while primarily known for chipsets, has a small sliver of the x86 processor market.

PCs for price points in the $200 to $300 range are rare but have been popping up recently. Xenitis, a manufacturer in India, sells a PC with a configuration similar to Terra for about $238 (9,990 rupees), with a monitor.

Meanwhile, in the United States, Wal-Mart offers a Linux desktop with an Advanced Micro Devices' Sempron processor and 128MB of memory for $199 and an Intel/Windows machine for $320. Neither, however, includes a monitor, one of the more expensive components in a cheap PC.

According to AMD CEO Hector Ruiz, manufacturers will produce $100 laptops within three years.

To cut support costs for the Terra PC, Via puts the operating system and the applications on a read-only flash memory chip, rather than on the hard drive. Ideally, this will cut down on viruses and other problems, although it makes updates a little more difficult. The hard drive primarily exists to store additional programs, music and photographs.

"The idea is to get as close to the perfect as possible," Pradhan said. "There is no way I am going to take care of all of the problems."

The Terra will run Linux, although conceivably it could also be bundled with older versions of Microsoft's software that have been bug-tested for years.

Price declines are a staple of the PC industry. Compaq Computer gained ground in the consumer market in 1997 when it released the first mainstream desktop for under $1,000. A few years later, some companies offered "free" PCs to customers who signed up for three-year Internet service contracts. Most of those companies went under.

AMD came out with a device called the Personal Internet Communicator last fall in India. It is similar to a computer but comes with the Windows CE operating system. It hasn't made much of a dent. For instance, M.K. Shankaralinge Gowda, the secretary of the department of information technology in the state of Karnataka--he's the highest ranking IT official in the state where the high-tech city of Bangalore is located--had not heard of it.