"Why the skepticism?"
Well for one... lets start with the ever changing form factor and abilities.
Started out as about the size of 2 USB sticks. With HDMI on one end, and then USB on the other. Now its to credit card size, 256MB. (Yes, I read their fora about the 512MB PoP memory issue. thanks)
Next, plans to use Ubuntu, which this is perfect and right up Canonicals alley, so you would think! WRONG! WRONG! Canoncial (see https://bugs.launchpad.net/ubuntu/+bug/848154 ) PULLED the plug on the ARM V6 support and only supports the OMAP, basically TI is paying them to support the Beagleboards, so anything else ARM based is hosed, and you will have to go to Debian, or others. Thats fine, BUT... your targeting this to be used to do things like oh, play MP3's.. well then you have just run a foul of the DFSG, and 99.9999% of the Debian stuff has NO MP3 support unless you RECOMPILE IT! So your not going to do apt-get install mediaplayersoftware as it has NO MP3 support. Its great that it supports Ogg, but I provide Ogg formatted streams, and NO ONE USES them, but me. No arch or fedora doesn't count, first RPM based, and thanks but I've had enough dealings with RPM's on CentOS to say NO THANK YOU! Versus on Debian based DEBS and apt, simple as apt-get install, done.
Lets move on to connecing to see something..
HDMI? fail. Sure for the tech user side this not an issue. But if you aiming as stated by RPI that they want to see this in schools and developing areas, then HDMI is not a choice. Tons of old VGA monitors.
Oh..but we have compsite... Ok.. is that NTSC, PAL, or SECAM? And if its selectable how will I select it to start? If you need to keep costs under control your not going build 10K NTSC, 10K PAL, 1 SECAM, thats an inventory nightmare and cost issue right there.
Next, peripherals? Yes, the techies will walk over to their parts bin and pull out a USB hub, keyboard, mouse, no problem. Don't have it pick up some via ebay or if your lucky a decent local source. Again the techies aside, no problem. Back to that other target area, schools and developing areas. They are not likely to have spares of this available, and/or resources, namely $$$$, to fund purchase. And those touting get them from ebay etc... Ok... how is that going to work in the middle of the Africa for an area which may or may not have any data access, no ebay account, and no paypal account, let alone where its going to be shipped. Oh... groups/companies will donate those for projects. Great. You've got 100% commitments for 100% fulfment on these projects? Otherwise sourcing the various components for power supply, keyboard, mouse, hub etc. are not cheap, and easily will outpace the cost of the $25/35 board itself. And counter to what their spokeswoman on their fora thinks, this is not a "straw man" arguement. This IS an issue, and you need to have a plan on how your going to provide the WHOLE SYSTEM to users, and its not going to be $25 or $35, more like $75-99 with power supply, SD card with OS, keyboard, mouse, hub, HDMI cable, and/or VGA converter..... I love all those touting these $3 HDMI cables on ebay, and $7 s/h, again thats fine for the techie crowd who needs to pick up a few items, its not so good for some school in the middle of the Africa!
Now. I think this a FANTASTIC IDEA.. And I am game for 10 of the $35 Model B's right now, ship them over. If I can get their version of Debian to work with my project then I've solved a huge problem. I am very interested in this project... but I have doubts about the ability of this project to be viable OUTSIDE THE TECH ARENA, ie: those using the Ardurinos and Beagleboards. I am clearly in the techie developer side of this. I've got a price point I need to meet and trying to use a $150+ beagleboard don't cut it..
Personally, its a great idea, but dump the schools and delvoping areas aspect of this, and focus on competing in the Ardurino/Beagleboard arena, where there are people willing to pay for this device. I easily would pay $50 for the model b, and $99 for a 512MB version with other features. Oh, and you need to get others to beat down on Canocial to get their ARM V6 support back (Thats what the BBC article used, Karmic last V6 compatible), IF you want to continue to float the schools and developing areas portion. Why? Like it or not (and I have huge issues with canoncial on things) they've done more to make Linux a viable option to many users and make stupidly easy to get software installed and going with a few clicks or a simple command line. You might push the compile method/mode for the tech school users, but the other side of this, DO NOT CARE ONE bit! They want to install software and get on with it. And Canoncial has done that, and the support for it is far more widespread than the base Debian. Sure some of the Ubuntu stuff will install back to Debian, but you've lost the PPA's etc. that make some of this so easy to install along with the driver support, codex support etc..
I think the various areas they want to support are pulling them in opposite directions and are causing them problems. They need to pick a side tech (Ardurino) or schools/developing areas. There is no middle ground on this.