$25 ARM Powered Desktop

The Raspberry Pi Foundation (a UK non-profit) plans to develop, manufacture and distribute an ultra-low-cost computer, for use in teaching computer programming to children. They expect this computer to have many other applications both in the developed and the developing world. Their first product is about the size of a USB key, and is designed to plug into a TV or be combined with a touch screen for a low cost tablet. The expected price is $25 for a fully-configured system.

Here are the specs:
700MHz ARM11
128MB of SDRAM
OpenGL ES 2.0
1080p30 H.264 high-profile decode
Composite and HDMI video output
USB 2.0
SD/MMC/SDIO memory card slot
General-purpose I/O
Open software (Ubuntu, Iceweasel, KOffice, Python)