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Sprint: One Buck for One Netbook

After the recent report of a free netbook from Linux, Sprint is trying to one-up it: a one dollar netbook. The notebook subsidizing trend is not a novel idea, by any means. Familiar friends like AT&T have been doing it, along with Verizon. However, Sprint’s venture into the subsidizing field is a bold one, with $1 leaving a large chunk of change for the company to bite off.

The deal from Sprint is brokered through Best Buy. Best Buy provides the computer, which is a nifty little Compaq Mini from HP. Some reviewers hail it as “the most attractive netbook going these days.” Its feature-enhanced design make it a popular choice for netbook customers who like the power of the notebook with the portability of the netbook. The 10.1 inch display, combined with a camera, Bluetooth, and a none-too-shabby speed, make it a pricy, although popular option, for the AT&T subsidy. Asking price without the big-time subsidy is close to $400.

Sprint provides the data plan, which is a two-year contract that gives users complete web access via their 3G network. There may be a 5GB limit per month, however. The price of the contract is where Sprint makes their money. Since the data plan has a price tag of about sixty dollars per month, the contract lifetime total is at $1,440. Add to that the customary mysterious fees that providers always throw in, and you’re watching the price sail well above the $1,500 mark. No, Sprint is not losing money on the deal.

Netbook subsidizing is the same thing that cell phone producers have been doing for years. In fact, you probably bought your phone through a subsidy, whether you realized it or not. In the netbook subsidy worl, you buy a netbook at a ridiculously low price, but buy in to a long-term data plan. The company that provides the data plan pays for the rest of the computer. You, in essence, pay the service provider back through the long-term data plan.

It’s a good time for Sprint to join the subsidy party, even though some say that they are late to the game. Netbooks are in. Even though desktop computer purchasing has all but bit the dust, and notebook computer market is taking a downward slide of its own, netbook sales are in a boom right now. Lower prices and the wanderlust of computer users needing anywhere-connectivity combine to form a powerful sales force that mobile providers can leverage to significant monetary advantage. Sprint is hoping to do just that.

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