In early June, Asustek Computer and Intel announced at Computex Taipei that they would soon be releasing a low-end $199 subnotebook PC, the Asus Eee PC 701. It appears to be on schedule, and when it arrives in customers’ hands in late August or early September it will be running a variation of Xandros Desktop Linux.

At a fraction of the cost of most laptops, the Asus Eee PC cuts corners on features. Still, Intel and Asustek are certain that there’s a growing market for low-priced subnotebooks. In addition to the Linux-powered result of the OLPC (One Laptop Per Child) project, there is the also Linux-powered but slightly more pricey Foleo, recently released by Palm.