Cut-price computers are changing the game

For the first time since Alan Sugar nailed together a bunch of bargain basement components to build the first Amstrad computer, box builders seem to have reset their sights.

It's no longer de rigeur to have the meanest fastest, best connected machine on the block, bristling with ports and slots and upgrade options. It's no longer about the Gigahertz. Everything is about price, and the emergence of the netbook as the flavour of last year has changed the computer market beyond recognition.

The days when people would stump up hundreds of pounds for insignificant incremental bumps in processor clock speeds are, we suspect, over. The coolest kids on the block are bragging about how little their teeny laptop cost, not how long the CPU will take to fry an egg when it's overclocked within an inch of its significantly shortened life.

With a global recession meaning that more and more school leavers are heading into further education rather than the workplace, and the fact that any college kid without a laptop is almost certainly at a massive disadvantage both socially and educationally when it comes to his computer-toting peers, the rise and rise of the cheap and cheerful luggable is having a massive impact of the industry at all levels.

There is now fierce competition in the far east between China, Taiwan and South Korea with each company putting pressure on its supply chain partners to deliver components and services at ever lower prices.

The market is so tight, in fact, that some companies are even considering setting aside their national differences in order to better compete in an unprecedented symbiotic partnership on the international stage.

According to a report on Digitimes, three Taiwanese notebook building companies are considering a supply chain partnership which will enable them to reduce per unit costs on common components like lid hinges and connectors by leveraging economies of scale.

Qaunta, Compal, Inventec and Wistron are said to be in talks with suppliers to reduce component costs which would eventually filter down to retail prices.

And with notebook and netbook sales set to soar once the expected economic recovery gets underway, suppliers should be able to offset reduced margins with increased volume.

With so many companies from so many countries cutting their own throats - and each other's - to make portable computers down to a price, we can see a time in the not too distant future when a useful £100 netbook hits the market.

We can't wait.