Massachusetts Institute of Technology (MIT) is pitching for a $75 price for the second version of its OLPC (One Laptop Per Child) called XO-2, aimed at giving a billion of the world's poorest children a connected laptop.

OLPC's current laptop sells for $188, but the new version will cut costs by using a touch sensitive keyboard which can double as a second display.

The new XO-2 will be slimmer and lighter than the original version which has sold 600,000 units. The XO-2 is scheduled to start production in 2010.

Using a virtual keyboard makes it customisable to any language or alphabet and will generate economies of scale in the manufacturing process.

Also, the virtual keyboard allows it to be used for other purposes than as a keyboard. It can be viewed either vertically, as an e-book, or horizontally.

XO-2 was unveiled by Nicholas Negroponte, founder of the Media Lab at MIT and founder and chairman of OLPC. Negroponte started OLPC in 2005.

Negroponte's brother, John Negroponte, is the US deputy secretary of state and a former US ambassador to the UN and to Iraq.

OLPC has negotiated a price of $3 a copy with Microsoft to put Windows XP in the XO computers. The XO-1 originally came out with Linux running on an AMD processor. The XO-2 will have the option of running Linux or XP.

Unbelievably, Intel has set itself up in competition with OLPC after a brief period of joining up with the project and putting an Intel representative on the OLPC board. Now Intel is trying to sell low-cost laptops into the regions where OLPC operates. Negroponte has called Intel's positioning 'shameless'.

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