Embedded Linux... is it really cost efficient?

I've been doing some research over the last few days. I began with the simple idea of putting together a resource for home brewed netbooks. Should be a simple enough matter, right? Not really. While embedded technology has come a long way in the last few years. I believe a majority of companies offering embedded solutions are still living in the dark ages.

I can pick up a powerful Arm cpu based home network router at my local office supply company for $20 to $40 dollars. But, a far less powerful board for development purposes may cost anywhere from $130 to $1000. Tell me, why would I pay $300 for an old 586 based board running at only 133 MHz? I wouldn't. This thread posted back in 2005 pretty much sums up the market today. While a couple of the links listed in it are dead, most of them are alive and have actual embedded main boards for sell. The problem I'm having is that entry level netbooks imported from China start at around $130 and go up to around $500. How can the complete machines be this cheap if the development boards cost more then the completed device.

This is just the tip of the iceburg. Next I began looking into displays. Touch screen makes more sense to me that just a regular display. So I started there. First I had to learn the difference between the various available technologies. TFT seems to be the standard right now. I found a couple of companies offering TFT LCD displays in various sizes. This company only charges $517 for a 10.4 inch display. I found another company that offeres an 8inch display module for only $205. The 7 inch version is only $139. This is really starting to get rediculous. If we add everything up so far, we are well over $500 and dont have a keyboard or case yet.

Since the project is already getting so expensive I thought I would check out touchscreen. After looking around for a little while I stumbled across this company. They claim to provide OEM touch screen technology. Now if you look at the price list a 10.2 inch touch screen kit is $150 dollars!!! $135 dollars at this company. No wonder none of those cool little gadgets come with touch screen.

Should the embedded market continue this pricing scheme, I really don't see the micro devices really catching on. I really expected to be able to put this whole thing together for under $200. Not counting the case of course. I am completely astonished that a company would expect me to pay over $300 for any 200Mhz board.

There is light at the end of the tunnel. One company I found is actively trying to bring down the prices in the embedded market. Marvel has put together what they call a System on an Chip. The latest version is called the Kirkwood Series. Marvel has unveiled this new chip in their Plug Computer product with a development version from GlobalScale Technologies at only $99. They expect the consumer version to drop down to $49 very quickly. The Kirkwood SoC is a 1.2GHz Arm processor based on Intel XScale technology. The best thing is that Marvel actually has multiple core SoC's available. With a complete embedded computer at only $49, I well expect the entire embedded market to begin to see some highly competitive pricing very quickly. VIA C7 - step aside. There's a new sheriff in town.

Now if only someone will put together a reasonably priced LCD display.