Building the Perfect Laptop

The superslim ThinkPad X300 is Lenovo's bid for leadership in the high-stakes world of laptops

by Steve Hamm and Kenji Hall

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"Phyllis! Get me one of those interoffice mail envelopes!"

It was just after lunchtime on Jan. 15, and Peter Hortensius was storming through the cubicles at Lenovo Group's offices in Morrisville, N.C., shouting for his secretary. Hortensius, senior vice-president in charge of laptops, had just heard that Apple (AAPL) CEO Steve Jobs had unveiled the supersvelte, aluminum-clad MacBook Air by declaring it the "world's thinnest notebook" and dramatically pulling it out of an interoffice envelope. Lenovo's ThinkPad X300 notebook was due out in February, after a year and a half in development, and Hortensius was alarmed that it could be upstaged before it even made its debut.

His secretary, Phyllis Arrington-McGee, ransacked filing cabinets until she found one of the envelopes. She handed it to Hortensius, who gingerly slipped the X300 inside. "It fits! It fits!" he shouted.

Perhaps no one was more relieved than David Hill, Lenovo's chief designer, who stopped by Hortensius' office right after the envelope experiment. It had been his idea to create the superthin X300, which was originally code-named Kodachi. Hill shared a laugh about the test with Hortensius and later couldn't resist a poke at Jobs' latest creation. "I'm a bit tired of looking at silver computers," said Hill. "I'd never wear a silver business suit."

Such is life in one of the most competitive markets on earth: the portable computer business. The best engineers and designers at the most powerful technology companies slug it out with top-secret plans and ulcer-inducing deadlines. From Hewlett-Packard (HPQ) and Dell (DELL) to Acer, Lenovo (LNVGY), and Toshiba, design and production teams race to carve out their share of the fast-growing market. They fight over ounces and millimeters, but their victories are measured in billions of dollars.

For David Hill, Steve Jobs, and others in the fraternity, the questions are: What is the perfect combination of weight, price, and features? And what new technologies should be included? It's a sign of the intense competition that the revered Jobs received decidedly mixed reviews for Apple's Air, despite its eye-catching looks.

At Lenovo, Hill and his colleagues have a lot riding on the X300, part of its ThinkPad line of computers. The Chinese company bought IBM's (IBM) money-losing, $10 billion PC business in 2005 with hopes of using it to build a prominent global brand. IBM's ThinkPad had long been a favorite of executives and business travelers, but it lost cachet over the years. The goal now with the X300 is to deliver a machine that will burnish Lenovo's reputation worldwide. "We want to send the message that if there's a company in the industry that can continuously develop the most inventive and best-quality products with efficiency, it will be Lenovo," says Chairman Yang Yuanqing.

The X300 isn't perfect. Perhaps no computer can be. But its development over the past 20 months shows the journey of one team striving for perfection, while at the same time being forced to make hard compromises. Lenovo doesn't expect the X300, with prices ranging from $2,700 to $3,000, to be a huge seller. They believe it will be a "halo" product, leading to positive reinforcement for the corporate brand and for the more affordable ThinkPads. The X300 will be prominently featured at the Beijing Olympics, where Lenovo is to be one of the major sponsors.

Lenovo needs a hit, perhaps more than one, to win recognition as one of technology's premier brands. It trails behind leaders HP and Dell in the notebook market, and some competitors are dismissive of its prospects. "We have bigger rivals to worry about, except in China," says Michael S. Dell, chief executive of Dell in an interview.