Asustek's move to rival OLPC a 'poor strategy'

From EETimes by way of a post in the Eeeuser Forum by bigmat1201.

TAIPEI, Taiwan (06/14/2007 8:23 AM EDT) — Asustek Computer is making a poor choice by getting into the low-end notebook business based on Intel Corp.'s Classmate PC platform, according to an analyst at CLSA Asia Pacific Markets...

...as for the Asustek's Classmate platform, called the Eee, Chen believes it will only drive down the company's margins. The Eee, unveiled at last week's Computex, is emerging as a competitor to the One Laptop Per Child project. The OLPC cost is down to about $150-$175 while Asustek's Eee will sell for $200. Both will start shipping in or near September. The target for the Eee is to move 500,000 units by year end.

"We are concerned that the low-end model will eventually translate into downward pressure on Asus' premium on notebook ASPs and margin," Chen said.

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The 500,000 unit sales projection appears to be an increase over the 200,000 figure quoted by their chairman during the Computex launch.