A company is now selling what it calls the "world's cheapest laptop", which at $130 (£65), is not a bad deal if you can bear some hardware limitations.

The Impulse NPX-9000 laptop has a 7in screen and comes with the Linux OS. It has a 400MHz processor, 128MB of RAM, 1GB of flash storage and an optional wireless networking dongle. It includes office productivity software, a web browser and multimedia software.

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There's a caveat though - it has to bought in bulk, in units of 100. The laptop is available on Alibaba.com through the online store of Taiwanese company Carapelli Ltd.

The cheapest laptop to date was known to be One Laptop Per Child's XO laptop, available at $188 (£90) for a limited time late last year. While a technological landmark, it had some hardware limitations like a slow processor and limited graphics capabilities.

The laptop hints towards a trend of lowering PC prices. Last week, a company called CherryPal introduced a $249 mini-desktop, also running a 400MHz processor, with 256MB of RAM and 4GB of internal flash storage.

In a recent interview, former OLPC CTO Mary Lou Jepsen said she would bring out a $75 laptop by 2010. Now running her own company, Pixel Qi, she cited the falling prices of RAM and components as a way to bring down laptop prices.

The low-cost laptop industry's poster child is Asus's Eee PC, which was introduced last year and sold 350,000 PCs in its first quarter.

See also:

Eee PC 901 review

Eee PC 701 review