News Update: Competitors have a hard time partnering

The GeekCulture comic mashes up the OLPC/Intel spat with the well-worn, "heartfelt" Chris Crocker - LEAVE BRITNEY ALONE! video that made the rounds a few months back. Wayan has already (and pretty accurately I'd say) compared Intel leaving OLPC's board to a messy breakup, and Chris D gives us some more staid business analysis. Nevertheless, the messy breakup comparison holds. The story has both sides pointing fingers and name-calling; less polite (via the BBC):
The head of Intel Paul Otellini said an accusation that the firm had failed to deliver on promises was "hogwash". "I don't want to get into specifics but we met every obligation that we were committed to," he said.

Professor Negroponte responded: "My version of events is not hogwash. Why would I throw away the six million dollars they were supposed to give us yesterday? Why would I do all of these things unless I was stark raving mad?"

And like all bad breakups, it played out through third parties and -- worst of all -- email. Intel "accidentally" leaked their pending exit from the OLPC board to reporters first and then by email to Negroponte. Predictably, Intel later apologized for the way it handled the news, and no doubt wished it could just start again fresh and do it right this time.

At the heart is what Intel calls a "philosophical impasse about how the market gets served," (that's business-speak for "irreconcilable differences") and what OLPC sees as underhanded competition ("cheating"). The crux is that Intel is trying to sell to the same governments that have already promised to purchase OLPC laptops, often while the seat was still warm:
In Peru, where One Laptop has begun shipping the first 40,000 PCs of a 270,000 system order, Isabelle Lama, an Intel saleswoman, tried to persuade Peru’s vice minister of education, Oscar Becerra Tresierra, that the Intel Classmate PC was a better choice for his primary school students.

Unfortunately for Intel, the vice minister is a longtime acquaintance of Mr. Negroponte and Seymour Papert, a member of the One Laptop team and an M.I.T. professor who developed the Logo computer programming language. The education minister took notes on his contacts with the Intel saleswoman and sent them to One Laptop officials.

It's important to note that Intel had been invited to give a quote for a computer project -- for Peru's secondary schools -- and added on a proposal to also do primary schools (where the XOs were being deployed):

In a telephone interview Friday, Mr. Tresierra said that his government had asked Intel for a proposal for secondary-school machines, and it had responded with a proposal offering the Classmate PC for primary grades.

“We told them this is a final decision, we are running the primary-grade project with the XO,� he said. “She wasn’t very happy.�

Back on the OLPC Soap Opera channel, Intel was invited up for drinks with OLPC's BFF and got a bit too cheeky, and the BFF decided that OLPC would be better knowing about Intel's wandering hands. (OK I'll stop belaboring the comparison.)

This naturally shelves a prototype OLPC laptop running with an Intel chip inside that was to be demo'd at next week's Consumer Electronics Show (CES), and has OLPC looking around for other partners and open (again) to finding a way to run Microsoft XP on the OLPC XO machine perhaps.

Now, this whole partnership was dubious to begin with, as OLPCNews discussed when it began; you have a for-profit, publicly traded corporation partnering with a non-profit organization, and they both make low-cost educational laptops. OLPC was the first to focus on the developing world market, but that market has been attracting much more attention from the for-profit crowd of recent. This episode reminds me of the scorpion and the frog fable; where the scorpion kills the frog he's convinced to carry him across a river, explaining his illogical action away by saying "I could not help myself. It is my nature."

Intel must maximize shareholder profit; and to do this must find and exploit new viable markets (or at least appear to be doing so). OLPC made the developing-world low-cost laptop market look viable; therefore Intel must explore the possibility, even if doing so wrecks its partnership with OLPC.