Microsoft cuts XP prices...

Microsoft has slashed prices on Windows XP and Office to join the Thai government's "people's PC" project, a move which could help curb the spread of the rival Linux operating system in the country.

Microsoft last week announced plans to join the budget PC project by offering a bundle containing Windows XP and its Office suite to ICT PC buyers for a mere 1,490 baht (£22), the Thai daily The Bangkok Post reported.

Buyers can now choose a Windows- and Office-loaded desktop for 12,390 baht (£182), excluding taxes, the report said. In other parts of the world, a standard edition of the Office XP software alone costs about £243.

"Microsoft has developed a specific Thai programme with a unique product for this unique project," Andrew McBean, Microsoft Thailand's managing director, was quoted as saying.

However, users in other parts of Asia are unlikely to get a similar low-price bundle as the deal is for Thailand only. McBean told CNET Asia the company is open to discussions with other Asian governments to "provide better access to technology for the disadvantaged".

"Microsoft is investing in the development of a tailored and limited version of its Windows XP Home Edition product in Thai as well as offering its Office XP Standard Thai Edition software specifically for the ICT Program,'' he added.

Last month, Thailand's Information, Communications and Technology (ICT) ministry introduced a series of budget computers to increase computer literacy among the poor.

Two government-subsidised models -- a notebook from Hewlett-Packard and a desktop from local computer makers like Belta, SVOA and Computec, were launched at reduced prices of 19,500 baht and 10,900 baht respectively.

Since then a number of other PC makers have joined the fold, including Taiwanese-based Jade Quantum, which is making another notebook for this project.

To date, more than 160,000 of these computers have been sold, helped by an easy-payment plan arranged with local banks by the Thai government.

The first batches of machines were loaded with Linux TLE, a Thai-language version of the Linux operating system, one of the first few open-source desktop implementations for the mass market in Asia. They also come with the OpenOffice productivity suite, a package which includes applications for word processing, presentations, spreadsheets and Web browsing.

Microsoft chief executive Steve Ballmer recently identified Linux as a threat to his company. The move to join the Thai project also yields another benefit for the software giant -- stemming losses from piracy.

"Thailand is a market where pirated software is freely available. It's to be expected that a significant number of buyers of the Linux PCs will go home and reload them with a pirated copy of Windows," Dion Wiggins, Gartner Asia-Pacific's research director, told CNETAsia in an earlier interview.

None of the large US-based PC makers -- HP, IBM and Dell -- have been known to sell consumer desktops or notebooks with the Linux OS pre-installed until recently.

Earlier this month, Big Blue launched a Linux NetVista A30 desktop in India, but the machine costs much more than HP's notebook offering in Thailand. The Pentium 4 computer featuring a lower-cost graphics chip and CD-ROM drive costs 39,000 rupees (£520). Winston Chai writes for CNET Asia