Niue has become the first nation to dish out one of the OLPC’s XO laptops to every school child in the country.

Every middle and high school student on the South Pacific Island of Niue has received one of the low-cost laptops from the OLPC foundation. While this is a milestone for the OLPC project (the distribution of the laptop to a whole country of children), the announcement isn’t actually all that impressive when you consider the fact that Niue’s population is just 1,500 and the number of laptops distributed was just 500. To date, distribution of the XO laptop is matched by Intel’s Classmate PC despite the fact that there’s been considerably less mainstream press coverage for the Intel rival.

The OLPC project created a huge stir when it was first launched. People were divided as to whether or not the project would succeed and questioned the notion that putting a laptop into the hands of every child was really what was needed to bridge the digital gap in developing nations. We’ve also seen a boom in the netbook and nettop market since then, which is driving the prices of producing decent, low-cost netbooks down and potential competition for the likes of the XO latop the Classmate up.

The cost of one XO laptop right now is at about $200 but you can get an ASUS Eee PC for roughly $400. The former has always been touted as the bare essentials, only the basic parts of a laptop with none of the frills thrown in to keep the price as low as possible. The OLPC foundation has always made a huge deal of how much effort goes into producing the XO machine for the price it is. However the likes of the EeePC manages to achieve the same for just double the price, something that a lot of people wouldn’t have thought possible a couple of years ago. So while Niue is an achievement for OLPC, it’s a small achievement in a fast paced market and compared to Intel’s deal to supply 500,000 Classmates to Portuguese school children, it’s not really that much.