Discussions are under way to put an Intel microprocessor inside a version of the One Laptop Per Child (OLPC) project's "$100 laptop" for children in developing countries, according to representatives from both parties.

"Intel, like a lot of other people, is more than welcome to try to design great silicon for this project and this mission, and we've been working with them to help them do exactly that," said Walter Bender, OLPC's president, in a telephone interview.

Despite its nickname, the OLPC's lime-green XO laptop actually costs $175. The first version of the machine runs on Advanced Micro Devices' 433MHz Geode LX-700, an x86-architecture chip that is slow by the standard of mainstream processors but consumes little power and costs less.

OLPC is close to starting production of the XO. The group has already gone through four generations of test systems to refine the laptop's design. A production run of 300 machines was completed in August, a final preparatory step before the XO goes into mass production later this month or in early October.

While OLPC has yet to decide whether or not to use Intel processors, Intel confirmed its engineers are developing a motherboard based on one of its chips for an OLPC laptop. That process required the engineers to start from scratch, since the current XO design isn't based on Intel's chips.

"It requires a new design, a new product," said Leighton Phillips, the manager of Intel's World Ahead Program in Asia.

The design, which Intel plans to submit for OLPC's consideration, will be based on either existing mobile chips, such as modified versions of the Celeron M called A100 and A110, or Silverthorne, an upcoming processor designed for small, mobile computers.

The dual-core Silverthorne processor will be made using a 45-nanometer production process and will be available early next year in different versions.

Silverthorne's main advantages are lower power consumption and size. The chips are so small that Intel can fit 2,500 of them on a single 300-millimeter silicon wafer, helping to keep unit production costs low enough for them to be used in handheld devices and low-cost computers.

Whether Silverthorne is cheap enough to be used in laptops like the XO remains to be seen. "We're looking at ways to get there," Phillips said.

If an Intel chip ends up inside an OLPC laptop, the laptop may be different from the existing XO design. That laptop was designed for use in harsh, rural environments with lots of dust and high humidity, but OLPC wants to develop laptops for use in urban areas where better infrastructure is available.

"I can imagine there will be a family of laptops in terms of processor power and maybe there will be a larger form factor for older kids," Bender said.

The discussions over an Intel-based laptop are part of wider talks on how Intel and OLPC can cooperate on technology and product development. Those talks started in July after Intel and OLPC signed an agreement that, among other things, gave Intel a seat on the group's board and prevents the two sides from disparaging each others' products.

Besides putting an Intel processor inside a future OLPC laptop, the talks could see some of the technology developed by OLPC find its way into Intel's hands. For example, the chip maker is interested in the low-power screen technology developed by OLPC.

Offering an OLPC laptop with an Intel processor doesn't mean the group will stop using AMD's chips, Bender said. "The Geode's been very easy to work with and hasn't been a limiting factor whatsoever," he said.

As part of OLPC's desire to offer systems based on different processors, the group is looking to work with other vendors, in addition to Intel. One such company is Marvell Technology Group, which could see its Xscale processors, which the company acquired from Intel in 2006, also end up in future OLPC laptops, Bender said.

"We want to have lots of choices, lots of people doing this, because there are lots of kids and lots of need," he said.