I've previously written about why thin-client is a not-now and not-soon solution.
The $249 "CherryPal" box reminded me of another twist on the problem ... one that comes into play when the thin client isn't just software (like Skyfire's screen-scraping browser) but a new hardware device.
See, here's the thing about building your own new hardware in smallish quantities: it's really expensive on a per-unit basis. Or, another way, you can't offer a fraction of the capability per dollar that a Dell or Sony can. Your $249 thingamabob is going up against other $249 devices that have way more stuff (e.g., entire laptops) because they are produced in high-volume orders of established designs/modules/parts.
To be more precise, there is a spreadsheet you can put together that maps your bill of materials, plus any special physical design issues into a cost per fabricated unit. It includes multipliers that will make you sad, like your $2 can't-live-without-it chip might end up adding $20 to the finished product cost... depending on where it fits in, affects other parts, quantities, and other stuff.
It's tempting though, especially since the last 5-10 years have brought the ability to fabricate in China for lower cost and in much smaller quantities than would have been practical before. (Of course the costs aren't really lower, they're just externalized into a bunch of other areas ... but those are politics/economics/policy areas more than tech, so I'll leave them be for now.)
So, whereas before you might have needed to sell 700,000 units to break even on something, now 20,000 units will do it: increased temptation.
But if you're CherryPal, you still need to convince someone that a $249 thin-client is more useful than a $299 laptop with 10x the horsepower, a screen, storage, and all the rest.