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Why Netbooks Will Soon Cost $99 221

CWmike sends along a ComputerWorld piece which predicts that "netbooks like the Asus Eee PC, the Dell Mini 9 and the HP 2133 Mini-Note will soon cost as little as $99. The catch? You'll need to commit to a two-year mobile broadband contract. The low cost will come courtesy of a subsidy identical to the one you already get with your cell phone. It's likely that HP is working with AT&T (they're reported to be talking), which announced a major strategic shift a couple of weeks ago that should result in AT&T stores selling nonphone gadgets that can take advantage of mobile broadband, including netbooks. What's more interesting is that low income and cheapskate buyers are starting to use iPhones as replacements or substitutes for netbook, notebook and even desktop PCs. The author's take: A very large number of people are increasingly looking to buy a single device — or, at least, subscribe to a single wireless account — for all their computing and communications needs, and at the lowest possible price."
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Why Netbooks Will Soon Cost $99

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  • by Laebshade ( 643478 ) <> on Saturday November 01, 2008 @08:20AM (#25594007)

    I'd hardly call using an iPhone as a replacement or substitute for a net/note/lap/dog-book or desktop being a "cheapskate buyer".

  • by CastrTroy ( 595695 ) on Saturday November 01, 2008 @08:20AM (#25594009) Homepage
    It would be better just to buy it outright. With free wireless broadband being so easy to get, and the cost of these netbooks dropping, you are probably just better off buying it outright, and not being tied into a provider.
  • by Coeurderoy ( 717228 ) on Saturday November 01, 2008 @08:29AM (#25594035)

    Actually calling them incompetent buyer would be more accurate, but the parent article is still quite right.
    Most people are impulse buyer and will pay anything if the "first byte" is not too painful.
    You will see things like:
    59$ down payment 19.9 for the three first month (and in small 29.9 for the super premium student value subscription or 59.9 for the standard and 99.9 for the business (the only one that is actually of any use to you) subscription...

  • by ciaohound ( 118419 ) on Saturday November 01, 2008 @08:51AM (#25594139)

    Because the iPhone is expensive? For a cell phone, sure it is. But most cell phones aren't handheld computers (yet).

    With telecom in many developing countries, buyers skipped having a land line and went right for cell phones. Buyers in developed economies often realize they don't need a land line. I'm not one of them, but, in today's economy, if someone buys a cell phone and it's also a usable web browser, why pony up for a desktop, laptop, or even a netbook?

  • by wild_quinine ( 998562 ) on Saturday November 01, 2008 @08:57AM (#25594153) Homepage
    1. Predict Something that has already happened.

    2. ??????WTF?????

    3. Look like an idiot.

  • Frankly (Score:5, Insightful)

    by Colin Smith ( 2679 ) on Saturday November 01, 2008 @08:57AM (#25594159)

    I don't understand why I can't simply "dock" my 300MHz 64Mb RAM, 2Gb storage mobile phone into a cradle and use a normal keyboard, mouse and screen to edit documents, write emails, browse web etc.

    Psion had fully featured word processors, spreadsheets and cardfile databases running on 16bit hardware a decade ago, the problem isn't the OS or hardware... All the current crop of smartphones are up to the job.

  • If only (Score:5, Insightful)

    by kurtis25 ( 909650 ) on Saturday November 01, 2008 @09:03AM (#25594183)
    If mobile broadband were fast enough to watch TV online, if the bandwidth caps were high enough to connect to my firm's remote server 8 hours a day and watch 5 hours of TV shows online a week and it was less than the $30 a month I pay for internet now I would sign up in a heartbeat.
  • Predictions (Score:5, Insightful)

    by markdavis ( 642305 ) on Saturday November 01, 2008 @09:14AM (#25594231)

    1) MS-Windows only
    2) Overpriced monthly service
    3) Hardware hard-wired for only a single carrier

    How wonderful, I can hardly wait.

    Why don't we do this with cars next- "Get this wonderful car for only $8,000; just sign this $800 per month, 3 year contract for Exxon gas- and oh, by the way, it will only run on Exxon gas, and you are only allowed 20 gallons per month".

  • by walter_f ( 889353 ) on Saturday November 01, 2008 @09:19AM (#25594261)

    ... will indeed be able to get things done with a well-chosen netbook. The more intelligent among them (be their income low or relatively high) will prefer to buy their netbooks the traditional way, not as a part of a two-year service contract.

    On the other hand, whoever expects to satisfy their computing needs with an iPhone or a similar device will end up dissatisfied, and doubly so when on a service contract that has to be paid for monthly from a low income.

  • Re:News? (Score:2, Insightful)

    by jawtheshark ( 198669 ) * <slashdot@j a w t h e s h> on Saturday November 01, 2008 @09:37AM (#25594353) Homepage Journal

    As it is in Europe, providers can extort pretty much any rate they want on incoming calls, and the market doesn't punish them -- because


    My wife and I used to be on different carriers. If she called me from cell to cell, yes, she had to pay more for that call (which is outgoing for her). Incoming, I paid exactly nothing at all. Inter-carrier rates for incoming calls are non-existent where I live and I know they don't exist in Belgium, France, Germany and The Netherlands. Maybe Danmark is special in this case?

    Technically, I can have a cellphone and it will cost me nothing if I never ever call with it. Incoming calls are always free (roaming being an exception, of course). I have a "pay-as-you-call" plan. I effectively pay only when I call. No monthly fees, no recharge cards. Only a slightly higher rate for my outgoing calls. Still only 0.09€/min My bills are pretty much 15€ per month, and that's with my wife and my phone tied to that bill.

    Now if you're talking about *roaming* you open another can of worms, but roaming is a special case.

    Finally, what you say makes no economic sense. If you had to pay for incoming calls at one carrier, and the next carrier asks less or even nothing, who are people going to flock to? Indeed...

  • by tyme ( 6621 ) on Saturday November 01, 2008 @09:40AM (#25594367) Homepage Journal

    There is a big difference between the subscription plan you buy with your mobile phone and subscription plans like this: with the mobile phone, the thing the customer is actually interested in isn't the physical phone, but the ability to make phone calls on the network, so paying the subscription fee makes sense for the consumer; the cost of the phone, which is usually indexed to the customer's desire for features/prestige/etc. is incidental to the actual thing being sold: access to the wireless network. With all these plans to sell full-fledged computers by tacking their price onto some other service, the problem is that the other service is usually incidental to customer's actual interest: the computer. If the customer doesn't really want the thing you are trying to sell, then you will have a tough time keeping them in the subscription plan.

    This was tried by a number of companies in the late nineties, and all failed miserably. Apparently there are a bunch of young MBAs out there who didn't learn the lesson of the iOpener.

  • by Registered Coward v2 ( 447531 ) on Saturday November 01, 2008 @10:02AM (#25594491)

    "Free" and "easy to get" is relative - try traveling around the US on a frequent basis and it becomes neither free nor easy to get.

    Lets see... last time I checked there were about 5 unsecured wireless routers in range, and there were a lot more last time I went into a major city.... Its both free and easy to get.

    Yes, and you have no idea whose router that is or what they are doing with your data stream; nor how long they will be up. Besides the security issue, if you are moving or inside a building may unsecured routers go away.

    Not to mention "major city" leaves out a lot of the US.

    Finally, leaching bandwidth is not free.

  • by Registered Coward v2 ( 447531 ) on Saturday November 01, 2008 @10:25AM (#25594597)

    Contract plans only make sense because the majority of people sign them for a cheap phone. If less people signed contracts, there is a good chance phone companies would work harder on customer retention, rather than acquisition, and prices would drop for non contract and pay as you go (and they are getting better anyway, Virgin Mobile offers unlimited voice for $80 a month with no contract, which is somewhat competitive/comparable with the $100 unlimited plans from the big carriers, except for data/messaging, which aren't all that expensive).

    Contract plans only make sense because the majority of people sign them for a cheap phone. If less people signed contracts, there is a good chance phone companies would work harder on customer retention, rather than acquisition, and prices would drop for non contract and pay as you go (and they are getting better anyway, Virgin Mobile offers unlimited voice for $80 a month with no contract, which is somewhat competitive/comparable with the $100 unlimited plans from the big carriers, except for data/messaging, which aren't all that expensive).

    Except that by not being able to spread out the cost of the phone over 12 or 24 months many people would not buy a phone. If there truly was interest in pay as you go you'd see a lot more uptake on those plans.

    However, consumers find contracts a better value and so chose them. There are plenty non-contract alternatives at a wide range of prices. Overall, however they are not as popular as contract plans because consumers find more value in a contract with a subsidized phone. While VM offers a good deal at $90/month (voice and text) there phone selection is a bit limited.

    In addition, the ability to add on additional lines on contracts and share minutes is a selling point for many users as well. Four phones on a family plan is cheaper than four monthly non-contract pay as you go plans.

  • by TeamMCS ( 1398305 ) on Saturday November 01, 2008 @10:35AM (#25594659)
    I'm sorry, maybe a mixture of demand and my ignorance has confused me but wern't these netbooks (i'm looking at you 701) should have cost $99? Now we've got netbooks creeping past £400($600-700USD). I love these devices but my XPS 2.5Ghz Penryn, 4gig ram (yadyada)cost barely a few hundred dollars more. The size difference isn't that amazing on the new 10" models. Speaking of which, why the seriously crap resolutions? 1024*600, 800*480. My Sony U3 [that was subsiquently stolen :@], which is knocking on 5-6 years old had an 4:3 XGA resolution. Christ, my 15" laptop has a 1920x1200 screen so the technology is avalible and cheap enough to have high density screens - why not include a nice 1280*1024?
  • by fredmosby ( 545378 ) on Saturday November 01, 2008 @10:52AM (#25594779)

    But in 2008 most people use a computer mainly for web browsing and email, so for most people a computer is useless without an internet connection.

  • by gelfling ( 6534 ) on Saturday November 01, 2008 @10:54AM (#25594797) Homepage Journal

    Seems like not so much a bargain. But that's just me.

  • by Phizzle ( 1109923 ) on Saturday November 01, 2008 @12:05PM (#25595279) Homepage
    Its called Deflation, and its here.
  • by Jorophose ( 1062218 ) on Saturday November 01, 2008 @12:58PM (#25595685)

    Speaking of which, why the seriously crap resolutions?

    It's because of people who want XP on these machines. Microsoft does not want XP on machines with resolutions bigger than 1024x768, with more than a single core 1.6GHz CPU, and 1GB of RAM.

    So unless the OEMs are going to grow some balls and sell machines with dual-core atoms and 1280x768 equipped with Linux, you're going to have a technically inferior machine with XP or the better one with choice of Linux or Vista. (see: HP Mininote. 1280x768, runs Vista and SUSE.)

    These are also LED-backlit; I don't know if that makes it instantly more pricey than traditional methods (I know the 2133 uses CCFL).

  • by TBoon ( 1381891 ) on Saturday November 01, 2008 @01:01PM (#25595713)
    Might I ask *which* EU-country you were living in, and when? EU is a big place, with significant differences when it comes to things like this...
  • Re:Ahh convergence (Score:3, Insightful)

    by mollymoo ( 202721 ) on Saturday November 01, 2008 @06:04PM (#25597949) Journal

    But now netbooks appear, and there are some compelling reasons why they could displace cell phones as the one device everyone owns and carries. I suppose their two big problems are battery life and size.

    A lot of people are saying that netbooks with become the portable convergence device of the future. I can only assume they have never actually seen a netbook in the flesh. They are small compared to a laptop, but they are huge compared to a PDA or cellphone. You wouldn't want to lug one around all day just to read the odd email, browse some news while you waiting for a bus or update your Facebook status. The reason netbooks won't become the one device everybody carries is simple: you cannot fit a screen and keyboard large enough to be used like a laptop in your pocket. Until we have folding screens and keyboards a fraction of their current size it just will not happen. Pocket size is the limiting factor in what people are willing to carry. If it doesn't fit in a pocket sometimes you're going to have to leave it at home, which for your mobile communications device is unacceptable. For women who always carry handbags the size limitations are similar - it has to fit in the tiny going-out bag.

  • Re:News? (Score:3, Insightful)

    by amorsen ( 7485 ) <> on Saturday November 01, 2008 @06:24PM (#25598107)

    That doesn't matter to me as a customer.... You do realise that?

    It should matter to you that a call can be produced for 0.03EUR/min and you're paying at least 0.10EUR/min for it. Twice that if you're calling from a land line. That's the cost of not having a competitive market.

  • by jonbryce ( 703250 ) on Saturday November 01, 2008 @07:45PM (#25598631) Homepage

    In the UK a typical deal is

    Mobile broadband on its own - £15 per month
    Mobile broadband with a "free" eeePC worth £200 - £35 per month for two years.

    So you are paying £240 for the free laptop. That works out like a loan at 8.6% APR. Better than most store HP deals but still definitely not free.

  • by rtb61 ( 674572 ) on Sunday November 02, 2008 @02:20AM (#25600771) Homepage

    A netbook is only really a laptop replacement, when the laptop is in the portable range and not spending most of it's life on a desk ala the 17" screen desknotes. What is happening is smart phones are being bound back to more portable size, the PDA sized phone and even the PDA itself are going to lose ground to the netbook. So compact smartphone, netbook and, desknote/desktop become the standard connected persons digital line up.

    Likely the netbook will end up the most populus device in the western market, as it will end up on every school desktop and as the portable adjunct to the desktop device be it a notebook or a desktop. The netbook is going to end up being pretty abused, so durability (spills and drops), low cost (frequent replacement) and battery life are going to be the big drivers and, performance will take a back seat.

    With hardware performance being limited to achieve the other goals that means the software must be really efficient, no bloat and fast, and lets forget silly stuff like it can run what ever bloated operating system, what counts is how well the applications on top of the operating system run, so the big comparisson will be Openoffice on Linux vs M$office2007 on Vista and which is more fit for purpose or even capable of running in an acceptable fashion.

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