The OLPC and the Internet
The bitfrost specification indicates that perhaps some countries may not believe that the unique green branding will protect the laptop from theft: 971 The OLPC project has received very strong requests from certain countries972 considering joining the program to provide a powerful anti-theft service that973 would act as a theft deterrent against most thieves.
Bitfrost meets this challenge, but not without cost. With bitfrost, we see a return to a requirement for Internet connectivity to ensure the laptop's non-stolen status, or the laptop effectively "bricks" and won't work without going through a re-activation process.
This Internet requirement is mentioned briefly in the Wired article.
Now, this at first glance seems a bit at odds with the OLPC Wiki's section discussing school gateway servers:The OLPC networking concept is not Internet-based. We assume that there will be no Internet connectivity and no Internet gateways. The laptops are being deployed into countries which do not have a lot of native-language content available on the Internet.
Thankfully, there's more:In the case of an area without internet connectivity, a local school can extend the lease from its own server by Wi-Fi or with a USB dongle."
The specification goes into much more detail about how both activation (see line 318 and forward) and the USB dongle system works (see line 1009 and forward).
Of course, if the stolen laptop is taken from one community to another without Internet, then presumably it'll keep working, until that community's school server is updated (via sneakernet?) with a list of stolen laptops. Now, there's a word for taking advantage of a market where goods have different values in different locations, it's called arbitrage, and has been going on throughout human history.
Reinstalling the OS would be another route around this, but this, as well as toggling the security system itself, require a developer's key, and hopefully those won't leak out anytime soon. Another risk of course is if a country discontinues their OLPC project, and no service is available to renew the laptop lease, which has some people on the bitfrost discussion page calling it DRM - it is reminiscent of Circuit City's DIVX disk phase-out problem...
One would hope that countries wanting to activate the bitfrost system would be willing to put in place the infrastructure it requires - at least Internet connectivity will be fun!