AMD Discontinues Low-Cost PC

Chip-maker Advanced Micro Devices Inc. has quietly discontinued a money-losing line of low-cost PCs aimed at helping customers in developing countries get access to the Internet, according to a regulatory filing.

The Sunnyvale-based company rolled out the Personal Internet Communicator - a machine designed by AMD and that used AMD processors but was built by an outside contractor - in 2004 as part of a campaign by Chief Executive Officer Hector Ruiz to get more of the world's population online.

The device, which cost $249 for the computer and a 15-inch monitor, initially was sold in India, Russia, China, Mexico and Brazil. Despite the low price, AMD said it intended to make a profit on the item.

But the company said in a filing last week with the Securities and Exchange Commission that it stopped making the machine after it failed to generate significant sales and many of the units were returned.

AMD blamed nearly $16 million in operating losses for the first nine months of 2006 on write-offs related to PIC products, according to the filing.

In a statement late Monday, AMD noted continuing partnerships with the One Laptop Per Child nonprofit group, which is researching ways to build $100 laptops for the world's poorest children, and Microsoft Corp., which is working on pay-as-you-go computing.

"(W)e are expanding what we started with the PIC, developing new business models and new technologies that will be introduced in emerging markets," the company said.