Intel has partnered with a Mexican telecoms company to sell an affordable PC designed for first-time computer users in developing countries. It's the latest effort by technology vendors to develop products for emerging markets.

Intel said the machine would be a small, energy-efficient system with fully featured PC technologies. It will be cheaper than typical PCs, with the cost adjusted for local conditions and family incomes, Intel said, without providing a specific price.

It will use a low-power Intel processor running either the Linux OS (operating system) or Microsoft's XP Starter Edition, a stripped-down version of the Microsoft OS for poorer countries.

The company has yet to determine who'll manufacture the product, Intel said. It often produces reference designs for systems and then shops them around its PC-making partners. The PC sellers will decide which OS is used.

It's the latest candidate to put computers in the hands of everyday people in the developing world. The OLPC (One Laptop Per Child) group, under founder Nicholas Negroponte, is developing a rugged $100 (about £58) laptop for use in child education programmes. Participants in that effort include AMD, Google, News Corporation and Red Hat.

Plans for Negroponte's laptop call for a machine running Linux with a sunlight-readable screen, 128MB of RAM and no hard disk. Instead, the laptop would have 500MB of flash memory, as well as four USB ports.

The lack of a hard disk has been criticised by Microsoft chairman Bill Gates, who questioned the usefulness of a computer with reduced functions. Microsoft has, however, expressed interest in community computing projects in developing countries where networked terminals and devices could be widely shared.

Intel's PC will have a hard drive, as well as built-in graphics, audio and networking capabilities. It will come with four USB 2.0 ports, two PS/2 ports and a parallel port. Video is supported through a standard VGA system, and the computer has an S-Video TV-out connection, Intel said.

In Mexico City yesterday, Intel president and CEO Paul Otellini said the company's 'Discover the PC' programme, under which the system is being developed, will be expanded to other countries later this year, including Brazil, Egypt, Ghana and Nigeria. Intel also pledged to donate 5,000 PCs for education and other programs in Mexico.