Words on the streets (street = PC World) say that Intel is already working on a 3rd iteration of its infamous netbook, the Classmate PC.

Set to be announced in a month or so, the new Classmate PC will be sporting a new design based on feedbacks that Intel received from those who are using the Classmate PCs. A software upgrade is also in the offing which analysts say might be the Sugar Interface which is was intended for use by another netbook the OLPC XO Laptop.

To help you recall, Intel’s classmate PC was designed primarily for school children and it is being manufactured by various PC makers in its area of distribution. Currently, the Classmate PC is already sporting a 1.6GHz processor with 1GB RAM, 30GB HD and an 8.9-inch display. Previous specs of the Classmate PC was a 900MHz Intel Celeron processor and only 256MB of RAM

If indeed we’re looking at a new Classmate PCs with specs matching those of the major brands’ netbooks (Eee PC, Aspire One, MSI Wind), Intel should take into consideration the price that it would put on its new generation Classmate PCs.

For in the end, the only thing that would separate each of these netbooks would still be their respective prices.

The laptop now has Atom processors running at 1.6Ghz and supports up to 1G byte of RAM. Earlier versions of Classmate included an Intel Celeron processor running at 900MHz and supported up to 256M bytes of RAM. Intel originally talked about the inclusion of the Atom processor earlier this year. Other hardware features for the new Classmate 2 include an 8.9-inch screen and hard drive storage of up to 30G bytes.

Intel is working with the Portuguese government to ship some of the new Classmate 2 PCs with Atom processors to around 500,000 basic-level education students for the upcoming school year, Kwan said.

A post from the Asus Eee PC blog.

Intel Preps Up the 3rd Generation Classmate PC