Netbooks - Subsidized or Overpriced??

Read on and decide for yourself

Now-a-days more and more netbooks are being offered at a subsidized price by mobile/cellular operators. It all started long ago when wireless operators, as a part of their marketing efforts, started selling subsidized mobile handsets to users in lieu of a long term service contract. Users could avail high end mobile phones at less than half of their price in the market when they signed a contract for using wireless services of the operator for a specific period of time, usually 1 to 2 years.

With the rise in popularity of netbooks which obviously offer more functionality than the mobile phones, the wireless operators decided to subsidize these machines too in lieu of a long term data contract. Let us now look at the main cellular operators in the US and the UK and what they have on offer for you.

Verizon Subsidized Netbooks

Verizon recently added 2 HP Mini’s in its arsenal. On offer are HP Mini 110 and HP Mini 311 at subsidized rates.

Spec sheet for the HP Mini 311 netbook is as follows:

HP Mini 311-1037NR

• Processor: 1.6GHz Intel Atom Processor N270
• Storage Hard Drive: 160GB
• System Memory: 2GB
• OS: Windows 7 Home Premium
• Mobile Broadband and Global Access Service Capable
• 11.6-inch diagonal HD LED BrightView Wide Screen Display ( 1366X768 pixels)
• Wifi: 802.11 b/g/n, Bluetooth capability
• HP webcam with integrated digital microphone
• 5-in-1 integrated digital media reader for SD, multimedia cards, memory stick, memory stick pro or xD picture cards
• NVIDIA ION for Windows 7 with upto 895 MB total graphic memory
• External Ports: 3 USB 2.0, 1 HDMI, 1 RJ-45 (LAN), 1 VGA (15 pin)
• Audio: Altec Lansing Speakers
• Dimensions: 11.4(L) X 8.03(D) X 0.78-1.2(H)-inches 
• Weight: 3.22 Lbs
• Power: 65W AC Adapter; 6 cell Lithium Ion Battery (upto 6.5 hrs)

Spec Sheet for the HP Mini 110 is as follows:

HP Mini 110-1046NR

• Processor: 1.6GHz Intel Atom Processor N270
• Storage Hard Drive: 160GB
• System Memory: 1GB
• OS: Windows XP Home Edition
• Mobile Broadband and Global Access Service Capable
• 10.1-inch SD LED Anti Glare Widescreen Display (1024X576 pixels)
• 5-in-1 integrated digital media reader for SD, multimedia cards, memory stick, memory stick pro or xD picture cards
• HP webcam with integrated digital microphone
• Wifi: 802.11 b/g
• External Ports: 3 USB 2.0, 1 RJ-45 (LAN), 1 VGA (15 pin)
• Audio: HD Audio, stereo speakers and integrated microphone
• Dimensions: 10.3(L) X 6.77(D) X 1.04-1.29(H)-inches 
• Weight: 2.57 Lbs
• Power: 30W AC Adapter; 3 cell Lithium Ion Battery (upto 3.5 hrs)

Now let us do some maths, here in the U.S. the HP Mini 311 is being offered at $250 with a two-year data contract ($60 per month) with Verizon which definitely sounds better than the $399 price tag of the same machine in the market. After doing a bit of calculations I found out that it isn’t really cheap. Not only will you pay $250 up front for the netbook, but you also have to add in a whopping $1,440 for data charges over two years. Total cost: $1440 + $250 = $1690. Whoa! That is one freaking expensive netbook.

Similar is the case with the HP Mini 110. It will be offered at a subsidized price of $200 with a 3G modem. That’s $100 less than the original price of $300. Now add the two year data charges which takes up the price of the netbook to a whooping $1440 + $200 = $1640.

Are you ready to put in that amount of money? I shall leave that decision up to you.

AT&T Subsidized Netbooks

Moving on to AT&T which is currently providing 3 subsidized netbooks priced at $199.99 after mail in rebate, it does seem they are a steal deal but on a reality check they don’t seem so at all. The netbook models that are available are as follows:

Spec Sheet for the Lenovo S10 is as follows:

• Processor: 1.6GHz Intel Atom N270
• Storage Hard Drive: 160GB SATA
• System Memory: 1 GB, 667 MHz DDR2
• OS: Windows XP
• Ports: External VGA Monitor Jack, Multimedia Card Slot, 4-in-1 card reader, 2 USB Ports
• Display: 10.1 inches (1024 x 576 pixels)
• Netbook Size: 9.8 x 7.2 x 0.9-1.1 inches
• Weight: 2.65 pounds
• Battery: 3 Cell battery which offer about 2.5 hours of usage time

Spec Sheet for Acer Aspire One is as follows:

• Processor: 1.6GHz Intel Atom N270
• Storage Hard Drive: 160GB SATA
• System Memory: 1 GB
• OS: Windows XP
• Ports: External VGA Monitor Jack, Multimedia Card Slot, 5-in-1 card reader, 3 USB Ports
• Display: 10.1 inches (1024 x 600 pixels)
• Netbook Size: 10.04 x 7.2 x 0.75-1.06 inches
• Weight: 2.2 pounds
• Battery: 3 Cell battery (2200 mAh) which offer about 3 hours of usage time

Spec Sheet for Dell Inspiron Mini 10 is as follows:

• Processor: 1.33GHz Intel Atom Z520
• Storage Hard Drive: 160GB SATA
• System Memory: 1 GB, 533 MHz DDR2
• OS: Windows XP
• Ports: Microphone Jack, Speakers, Multimedia Card Slot, 3-in-1 card reader, 3 USB Ports
• Display: 10.1 inches (1024 x 600 pixels)
• Netbook Size: 10.28 x 7.19 x 1.12-1.25 inches
• Weight: 2.86 pounds
• Battery: 3 Cell battery which offer about 3 hours of usage time

AT&T is offering 2 data plans for 2 years. They are

1. A $40/month 200MB plan (only good if you want to check e-mails on the go as the data limit is way too less)

2. Just for an added amount of $20/month one can get a 5GB plan for $60/month which makes much more sense than the previous plan.

So with the $60/mo plan clubbed in, the total price of the netbooks escalates to a whooping $1440 + $149.99 = $1590

Even a modest cellphone plan adds up to a lot in the long term, but we expect something in return: effectively unlimited data, decent calling plans, and a free or at least heavily subsidized handset. Here the only thing you're getting is an oppressive transfer cap and about $100 off street price on a few modestly-spec’ed netbooks.

Considering all the pointers, it sure isn’t a great deal.

Sprint Subsidized Netbook

Lastly, lets talk about Sprint which is currently offering the Dell Inspiron Mini 10 with an integrated EVDO Rev, similar on the lines of AT&T but with a higher price tag than AT&T. AT&T is currently selling it at $149 upfront but Sprint has priced it at $199 after rebate plus a mandatory two year contract with sprint for Sprint Mobile Broadband Connection @ $60/month.

My personal suggestion would be choose your plan wisely and buy these subsidized netbooks only if you really need to work on the internet on the move in which case you can’t live without the support of a wireless carrier. Else, if you are a home user just go and buy a netbook of the shelf and get an internet connection which does not bind you to a contract. But, I would still like to leave the choice of the netbook, the wireless carrier, and the contract terms to the end user.