What's The Real Cost of the World's Cheapest Tablet Device?

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A tablet device, built for the masses. And we mean masses. With a price tag of around $35 to manufacture, millions upon millions of these tablet devices will soon be made available, connecting people to the internet in places like India, China, and Africa. It is an incredible project from a company in Montreal, but it will likely have some incredible trickle effects on other people and companies.

The Globe and Mail reports on the story behind Suneet Singh Tuli, the 43-year-old CEO of a small Canadian wireless device maker called Datawind, which has won a contract with India to build the world's cheapest tablet device.

More than 800 million people in India have mobile phones and more than 10 million are signing up each month. Yet the number of Indians with regular access to the Internet is shockingly low: about 10%. The Indian government is banking on a nationally subsidized mobile tablet to help pull millions of its disconnected citizens online and into the modern economy...While companies like Apple, Samsung and Research In Motion have focused their attention on upper-middle-class consumers and business clients with $500-plus devices, executives like Nokia’s Canadian CEO Stephen Elop are touting the potential of the world’s next billion Internet users. What emerging markets fail to offer in profit margins, the thinking goes, they’ll make up for in volume. Moreover, connecting this massive untapped market will do more than help bring developing countries online; it will give early market entrants a competitive advantage over global tech leaders like Apple.

Ripple Effects Of Mass Production of Cheap Devices
This is no small thing. Building a tablet device that is affordable to tens of millions, even hundreds of millions of people will have drastic effects. The first effect is obvious -- it will connect more of the world to the Internet, to one another, to technology services and educational and business opportunities. However, there are major effects that are less obvious and that must be considered.

First, the materials to manufacture the devices have to come from somewhere, and to keep the price low, we can bet they are not going to be recycled materials. More worrying is that in a rush to get the minerals needed for electronics, there will be a lax approach to monitoring supply chains and conflict minerals -- essential to electronics, but the mining and sales of which fuel war, and perpetuate inhumane working conditions -- will have ample opportunity to make their way into our gadgets.

Second, there's the end-of-life disposal to consider. Where will these devices go when they break (and for $35 each, they will break) if they are in places without solid electronics recycling programs? Will they end up in landfills? In e-waste dumps? Will the devices be easy to repair so that users can fix them themselves, or find someone to fix them fairly easily so they don't have to be tossed out? The opportunity to take advantage of a repair culture in countries like India and China is huge, and it could mean more job opportunities for tech-savvy people and minimizing the flow of these devices to e-waste dumps. But that means the design of the tablet should be such that it is easy to take apart, replace broken components, and put back together.

From the Globe and Mail:

“We were trying to build the device while we were still designing it,” Raja later explained. To understand just how intense Datawind’s challenge was, consider that, in November, IHS iSuppli, a supply chain analysis firm, tore apart Amazon’s newest tablet, the Kindle Fire—one of the lowest-priced devices in the North American market—and tallied its components to a hard cost of $209.63 (this for a product that retails at $199 U.S.). Datawind was aiming to come in at a quarter of that.

So far, Datawind has manufactured about 10,000 of its ultracheap devices, and has subcontracted more factories in India to gradually churn out a volume of tablets that still seems unbelievable to the founders. The Indian state plans to subsidize the tablets down to between $20 and $35 (U.S.), to be sold to college and university students, and wants to roll the devices out to around 12 million users over the next 12 months. After that, the goal is to place one of these tablets in the hands of each of the country’s 80 to 100 million high school students. The process, despite the hype, is still in a nascent stage, unfolding slowly.

A Great Goal, But Only If True Cost Is Considered
It's an incredible goal, and it has its positive points. Who wouldn't want college students to have affordable devices that help them with research and school work. Though we have to wonder about alternatives to building 80 to 100 million tablet devices for students alone. What about reuse of technology? What about the millions of laptops that are only a couple years old that are being replaced by consumers every year -- is it really more difficult to create a program for collecting, refurbishing and reselling them for just as cheap to college students in countries like India and China -- or the US for that matter? Do we have to have the latest technology to feel like we're up on the game? And what happens to programs like One Laptop Per Child when a company figures out how to make tablets at a lower cost than the OLPC devices?

An endeavor as big as this opens up dozens of important questions, only a handful of which I've brought up here, and only a handful of of answers can even be guessed at at this stage. But we can bet that the more we try to mass produce new technology, the more we need to be extremely serious about the environmental effects, from mining of materials to recycling, from repairing broken items to upgrading them, from the health and living conditions of those manufacturing the items to those who deal with the effects of electronics left in landfills or e-waste dumps, and on and on.

This endeavor should be the snooze alarm going off yet again to governments, consumers, and manufacturers that there are a lot of problems in consumer electronics that we should be addressing that don't have to do with bottom lines and production schedules.

You can bet that the true cost of this tablet device is a whole lot higher than $35 a unit.

Tags: Corporate Responsibility | Electronics | E-Waste | Gadgets