Millions of children will soon have access to virtualised desktops in India in a deal that will serve a crushing blow to the One Laptop per Child (OLPC) project.

The computers will be supplied by NComputing, which managed to secure the deal over other low-cost computer providers including OLPC and Intel that also target the developing world.

The IT firm was contracted by the Indian state of Andhra Pradesh to supply 5,000 schools and their 1.8 million students with the NComputing X300 system, which enables up to seven users to share one PC at the same time.

The system will run on Microsoft's Windows Server operating system and use the Microsoft Office suite.

"At about $70 per seat, our solution is the ideal platform to enable schools, businesses and governments to maximise their PC investment," said Stephen Dukker, NComputing chief executive.

Raj Shah, chief marketing officer at NComputing, added: "This computerisation project shows how forward-thinking governments can use proven and practical technologies like NComputing to bridge the digital divide."

NComputing is offering the Indian government a cheaper alternative to OLPC's laptop priced at $188 per user and Intel's Classmate PC priced at $200.