Shipments could reach one million units in the first year in regional markets including Japan, China, South Korea, Indonesia, Thailand and India, the Nihon Keizai Shimbun newspaper said, citing sources close to the firm.

The operating system and application software, including spreadsheet, word-processing and other business applications, will be procured from Japanese companies, the Nihon Keizai said.

Because the PCs will use Linux instead of the more costly Windows platform, they will likely be priced around 400 dollars to 1,500 dollars -- or 44,000 yen to 165,000 yen -- making them 20,000 yen to 40,000 yen (180 to 360 dollars) cheaper than comparable Windows-based PCs, the newspaper said.

HP has chosen Asia as the launchpad for its Linux business because demand for PCs priced around 100,000 yen is particularly strong in the region, the Nihon Keizai said.

A major focus of HP's Linux PC business will likely be the Chinese market, the Nihon Keizai added.

It aims to develop a profitable business through focused volume sales in the region and expand it to the United States and Europe later, the Nihon Keizai said.

After-sales service will be comparable to that offered for Windows machines, the newspaper said.

SPACE.WIRE