OLPC’s Give 1, Get 1 Takes a Hit from Failing Economy and Rise of Netbooks

One Laptop per Child (OLPC) ramped up its second annual Give 1, Get 1 program in November 2008 with more marketing force than ever before, including national television ads (one even with a digitally enhanced John Lennon). The program allowed customers to give an XO laptop to a child in the developing world and buy an XO laptop for themselves for $399.

But a tough economic climate and the market flood of netbooks from the likes of ASUS, MSI, Lenovo, HP and Dell proved to make it a tough sell.

Last year’s Give 1, Get 1 program resulted in 160,000 donations. “This years G1G1 was miserable. We did only 12,000, in spite of a massive campaign,” OLPC founder Nicholas Negroponte told us. That is a 92 percent decline from last year.

Negroponte attributes the decline in sales this year to the failing economy but doesn’t discount the growing netbook market. “They certainly had an effect, but probably not as big as, nowhere near as big as the economy itself. Discretionary spending more or less dried up over night. One good sign was that Give only started to creep ahead of Give One Get One,” Negroponte admits. OLPC will continue its Give One program that allows customers to give one laptop for $199.

This announcement of the lowered holiday sales comes on the heels of  Negroponte’s public announcement (on OLPC’s blog)  that the non-profit has been forced to cut 50 percent of its staff. Negroponte maintains that the loss in manpower will not impact the development of the XO-2 – an all touch enabled laptop – which is planned for 2010. “We will certainly see new laptops out by the end of 2010. Keep in mind that we are doing a reference design, not a discrete laptop. I expect to see the constituent parts appearing in the field. The Netbooks copied to easy parts and are by no means addressing kids in the developing world.”

As for the current XO, though OLPC has cut internal development of its Sugar operating system, they will continue to support the Sugar OS  in several ways. “Perhaps the two biggest are via Peru and Uruguay, each of which have 150 people employed on the ground, some of whom are very technical,” says Negroponte.  He also hopes that dual boot – Microsoft XP and Sugar operating systems – machines could be out as early as April.