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A NOTEBOOK FOR EVERY STUDENT?

How Microsoft and Toshiba are scrambling to stoke the education market

At first, Anthony Amato thought someone was playing a bad joke. The community superintendent of New York City School District No.6 in Harlem had flown all the way to Redmond, Wash., to check out Microsoft Corp.'s plan to put thousands of notebook computers in schools. When he arrived, he was shown a video of upper-crust Australian schoolchildren using Microsoft spreadsheets.

''Here was this beautiful school with well-manicured children talking in prim English accents,'' recalls Amato, whose district spans some tough streets in Harlem. ''God knows what would happen if our kids walked down the street with notebooks under their arms,'' he remembers thinking. But that evening, Amato had an abrupt change of heart. Whatever the challenges, he decided, his students deserved the latest technology.

A year later, parents in District No.6 are thanking him for the decision. On any given morning, 20 fifth-graders in the Harlem pilot program are plotting graphs on Toshiba notebook computers using Microsoft Excel and clipping them into Word documents. Parents are learning how to use the computers, too--and splitting the cost with the school. ''We've had overwhelming support from the community,'' says Amato, beaming.

He's not the only one smiling: Fifty-one other American pilot schools are getting upbeat results in the same program, called ''Anytime Anywhere Learning.'' Kathy Klock, curriculum director at the Snohomish School District in Washington State, says engineers who visited one of her fifth grade classes were blown away by PowerPoint presentations given by young students.

Not surprisingly, Microsoft and its co-organizer--Toshiba America--are also enthusiasts. ''This program enhances critical thinking skills, and the way children analyze data,'' says Kathryn Yates, director for K-12 at Microsoft's Education Customer Unit, which supports teachers with online materials and technical help. Adds Toshiba America program manager Thomas J. Healey: ''The children learn to work with tools that they will use throughout their lives.''

As the program gears up, Microsoft could take its biggest step yet outside the business market. But there will be hurdles. Historically, Apple has dominated the school market and still holds a 51% stake, according to a survey by New York's IDC/Link Inc. Apple executives are skeptical about notebooks in schools. ''They're not rugged enough,'' says Apple Computer Inc. marketing manager Robert H. Kondrk. Instead, he's offering schools a sturdy version of the Newton PDA called eMate for $699.

Anytime Anywhere participants address this issue by coaching children on how to care for computers. In Harlem, parents help patrol children going to and from school. So far, none of the 52 pilot schools has reported a case of theft or loss.

Schools and parents in the Anytime Anywhere program purchase or lease their notebooks from Toshiba resellers. Hardware and software are discounted, as are service and insurance contracts. The only real guidelines in the program: Notebooks must be high-end models that the students have available 24 hours a day. And students must learn their way around a business suite called Microsoft Office (table, page 92).

STALLED HOME MARKET. If all this sounds a little self-serving--coming from Toshiba and Microsoft--it probably is. Penetration of PCs in American homes is stalled at about 40%, so hardware makers like Toshiba are scrambling to seed new markets. Believe it or not, Microsoft faces a similar challenge. Its hugely successful Office package--worth about $3.3 billion last year--has close to 90% of the market for business suites, according to International Data Corp., a market research company. But growth isn't accelerating. ''Where do you get new users?'' asks IDC consumer software analyst Mary Loffredo Wardley.

CONSTRAINTS. Enter the education market, which bears a striking resemblance to the corporate market. ''Schools have line-items that say 'software,''' says Wardley. ''Money is pre-budgeted, and decisions to purchase are made at a high level.'' The Anytime Anywhere approach also suits school agendas, she says, because the National Bureau of Educational Standards is asking teachers to go beyond math games to programs that impart higher-order skills. ''When you use graphing software, you see relationships, and you can make predictions,'' Wardley says.

Indeed, Microsoft's timing seems perfect. The Washington (D.C.)-based Software Publishers Assn. expects U.S. schools to pump about $4 billion into software and computer gear this year. Software will likely account for just $494 million of the total. But the number is bound to grow. Last October, Congress allocated $200 million for the President's new Technology Literacy Challenge Fund, aimed at upgrading technology in schools.

State and city matching grants will double or treble the total grant value. Big chunks of Title One antipoverty grants are earmarked for the same purpose. And on May 8, the Federal Communications Commission is expected to mandate discounts of up to 90% on Internet access for schools. After that, districts may try to get more Net-ready PCs on school desks.

This gush of grants and discounts springs from a strong bipartisan movement to prepare students for the high-tech workplace. Microsoft's new thrust into schools is in perfect synch with its emphasis on portable technology that parents and students share. ''It's a well thought-out program,'' says Anne Bryant, executive director of the National School Board Assn. (NSBA) in Alexandria, Va., which contributed expertise to Microsoft early on. School districts are struggling to bring parents into the learning process, she points out. ''One portable computer per student is every educator's dream.''

How big could the new notebook initiative become? In a word, humongous. About 52 million children are enrolled in public elementary and secondary schools, according to the National Center for Education Statistics (NCES). Another 5 million attend private schools. Every child is a target and every parent a potential cheerleader. ''The response from parents has been phenomenal,'' says Mirian Acosta-Sing, principal of the Mott Hall School for gifted children in Manhattan's District No.6, which Microsoft has used in videotapes and brochures to publicize its initiative.

Microsoft's success in the schools is practically guaranteed, say education market analysts, since teachers are already enthusiastic about its Office suite. Quality Education Data--a Denver-based education research firm--did an intent-to-purchase survey before Microsoft even dreamed up Anytime Anywhere. Recalls Jeanne Hayes, president and CEO of QED: ''Microsoft Office was at the top of the list.''

Australian teachers who have run a similar program for six years are among the most persuasive advocates for the new initiative. About 20,000 Australian children now tote notebooks to school each day. The teachers' reports from the front lines--conveniently packaged in Microsoft's public-relations material--dazzle American educators. ''The children help their friends with difficult programs,'' exults Ken Rowe, principal of Frankston High School in Melbourne, who is on a whirlwind tour of U.S. schools arranged by Microsoft and Toshiba. ''They take control of their own learning.''

If America has fallen behind, its high-tech multinationals intend to help it catch up. As Anytime Anywhere spreads, other PC companies are certain to jump on board. Compaq Computer Corp., for one, already has a program in place to make high-end notebooks available to college students at very competitive prices. ''This is something we could do in

K-12 schools as well,'' says Sue Collins, Compaq's director for education marketing.

Telecom service companies are also gearing up. Over the next five years, AT&T alone will spend $150 million to train teachers and help usher more schools into cyberspace. ''Today, 45% of private-sector employees must use high-technology tools in the workplace,'' says Joan Fenwick, director of the AT&T Learning Network, which disburses the funds. In 2000, she says, the number will exceed 60%. ''This investment is critical to our economic future.''

To help Anytime Anywhere, AT&T has given six months of free Internet service to the Mott Hall School in Harlem. That's a perfect gift for Yaa-Afriyie DuBerry, 10, a laptop-wise African American in the pilot program. She scrolls quickly through a PowerPoint demo of her story on how human beings got taste buds. Pausing for a minute, she defers credit for the animations. ''It's clip art,'' she says. ''I only had four days to put it together.'' Just imagine what she can accomplish in the next 10 years.

By Neil Gross in New York, with bureau reports



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