The $1 Netbook: What's Next?

By  Susan Nunziata — July 13, 2009

Netbook shipments are on track to exceed 30 million units by the end of 2009, according to DisplaySearch's Quarterly Notebook PC Shipment and Forecast Report for 2Q 2009.

In the U.S., netbook shipments are expected to reach 8.8 million units by year's end, up from 3.7 million shipped in 2008. The growth is due, in part, to new subsidized pricing plans from wireless carriers that mirror the contracts more commonly seen for cellphones and smartphones.

For example, Radio Shack is offering the Acer Aspire netbook for free in some of its stores if buyers sign on for a two-year mobile Internet plan from AT&T for $60 per month plus activation fee.

Verizon Wireless is selling HP mini notebooks at its retail stores for $200 with a two-year contract.

AT&T is planning to offer netbooks from Acer and Dell at its stores nationwide this summer.

Indeed, as this report notes, the wireless carriers are employing the same subsidized-pricing business model with netbooks that they're applying to cellphones and smartphones.

The latest entrant is Sprint. Best Buy is selling a Compaq Mini 110C-1040DX netbook in its retail stores for 99 cents to those U.S. buyers who sign on to get their mobile Internet via a two-year Sprint subscription plan.

Sprint's data plan prices reportedly average $60 a month for 5 gigabytes of data or $1,440 over the two years.

The same netbook at Best Buy comes with a markedly higher price tag (around $200) if two-year data plans are chosen from other carriers, such as Verizon or AT&T.

Sony is reportedly bringing its 10.1-inch Vaio W netbook to the U.S. market in August 2009 for around $500, minus the 3G or GPS features of some of its competitors.

Meanwhile, Dell is offering the option of a $69 add-on Wireless 700 card for its Mini 10 netbook that will give users integrated WiFi and GPS.

Netbooks running the new Google Chrome OS are expected by mid-2010 from hardware makers HP and Acer. Google's Eric Schmidt says he expects Chrome and the company's Android smartphone OS to "merge even closer."

Some are predicting that netbook sales could begin waning by then if innovative new products move in to fill the gap between smartphone and full-fledged notebook.

Indeed, Intel is reportedly in talks with Google to support Android-based mobile Internet devices such as tables.

Nontheless, there's speculation in the analyst circles that the Chrome OS could have a negative effect on Android development.

A number of companies -- including Acer, which is also marketing a Chrome OS netbook -- are reportedly looking at Android capabilities beyond the smartphone, for devices such as Mobile Internet Devices (MIDs), netbooks, set-top boxes and even televisions.

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