AT&T's wireless netbooks come with strings

It looks like the netbook, that cheaper, no-frills class of laptops, is increasingly going to be sold by wireless carriers much as they now sell most cell phones—that is, at a reduced price in exchange for signing a two-year service contract.

So how promising a development is this for consumers? We’ve looked the netbook deals with AT&T, the carrier that’s already selling netbooks this way, and reviewed our knowledge of the way reduced-price cellphone contracts work.

Here’s our take:

Less cost upfront, but… Starting this month, AT&T has been selling Acer, Dell, and LG netbooks in Atlanta and Philadelphia for between $50 and $250, depending on features.

That’s up to $250 less than you’d regularly pay for those models. However, you’ll have to sign up for either a $40- or $60-a-month AT&T data plan for your device. That adds up to $960 or $1,440 over the two-year contract period.

While we obviously don’t have data yet about how AT&T or other providers may cover the price difference between the retail and reduced price of these contract netbooks, our analysis of the way carriers pay for reduced-price cellphones suggests the answer: They’ll recoup the money from you.

That is, our look at the balance sheets of the cellphone carriers has revealed that carriers actually take a portion of each monthly cellphone bill and use it to reimburse them for their upfront cost of providing you with that “free” or discounted phone.

So if netbook contracts are set up like those of phones—and there’s little reason to think they won’t be —that low-cost netbook will be less like a discounted model and more like one that’s bought on the installment plan.

Plans have data limitations.  The $40 AT&T plan has a data limit of a paltry 200 megabytes a month, barely enough to cover a few e-mails and one YouTube download. Drive over the limit and you'll pay an additional 10 cents per megabyte – meaning viewing Susan Boyle’s YouTube video again could cost you another 30 to 40 cents. The $60 plan expands the data bucket to a more practical 5 gigabytes, but comes with higher overage charges: 49 cents per megabyte.

You can, however, stretch your data dollar by using these netbooks at Wi-Fi hotspots, which have no data limits and are generally faster. And, we’d suggest disabling any automatic operating-system updates (which can run to dozens of megabytes) and update manually—or download any new software— only when you’re on a Wi-Fi connection. AT&T’s plans include unlimited access to AT&T’s normally fee-based Wi-Fi hotspots.

The netbook is locked to the carrier. Don’t expect to shop around for another carrier after your two-year contract is up. The subscriber identity module (SIM) card that enables the AT&T netbooks to access the Internet via the company’s data network is locked to the carrier. (Wi-Fi access is unrestricted). That means you won't be able to use these netbooks with, say, Verizon's EV-DO data network after your AT&T contract runs out.

The takeaway: The so-called subsidized netbook will require some careful shopping, and consideration of its pros and cons.

Right now the  AT&T netbooks are the only computers offered at reduced prices by a major carrier that can wirelessly connect to the Internet when Wi-Fi isn't available. That may make them worthy choice for some people. (As Engadget reports, Verizon plans to roll out a netbook promotion by this summer.)

We're currently trying out one of the AT&T netbooks with its service, and will share our findings with you soon. Meantime, check our latest Ratings of netbooks, available to subscribers, as well as our buying advice on laptops and netbooks. —Mike Gikas

Comments

[cbryant1990]

Bridgee,

Go ahead an buy your netbook at fry's or best buy or amazon. Just don't get the bundled deal with 3g data access from att or verizon. That way your netbook is just like a stand alone laptop. But for me the benefit of the netbook is that you can throw it in the car, hold it in one hand, and use it at wifi hotspots.

[bridgeee_3]

I dont get it. can someone help me!?!? it is now 11/03/09 and I dont know if the netbook internet changes over time. but if i get a netbook for Christmas, and i have wireless at my house, and my house is the only place i will use the netbook, do i still have to but something every month? I really wouldnt use the netbook for business and I would only use it for facebook and fun stuff! HELP PLEASE! thanks(:

[Ted]

Netbooks! Why would somebody want one ? I want one to use exclusively for banking and confidential correspondence. In the event of an evaculation it is easily transportable and contains what could be vital info. They seem to have longer battery life than my larger laptops and it should be small enough to be locked in a small fireproof safe or just a secure close drawer. The next question is where would I use it. A desk area in my home with a 19" monitor, a usb hub connected to a full size keyboard, trackball, speakers (?), DVD-RW or DVD-RO, and a SSD or HDD. So what ports should it have ? USB's, ethernet, external monitor, internal telephone modem, headphone/mike jacks. I think 2 GB RAM would be nice and 1.6 GHz or better speed with a 20 GB SSD. I do not know if any netbook is configured like this yet but it is just a matter of time.

[Yacko]

"NETBOOKS ARE WORTHLESS, just get a 13 or 15in laptop if u want it to be small, and wifi is available a lot of places."

Your missing the point. The wireless carriers would like to muscle in to usury financing. Low or no down payment and $xx.xx per month. I could see them doing it with larger devices, different devices and the user forgetting what a regular computer used to be.

[Rachel]

I have an acer one ZG5 and it does NOT work at AT&T hotspots. The advertising makes it seem like it does but read the fine print. You must have AT&T connection manager. Acer's come with ACER connection manager. You can not change the hardware. There is no fix. You can not log into an AT&T wifi hotspot....but you can use 3G. Just watch you don't go over the 5 gig per month limit for $60. The $60 includes access to AT&T hotspots but Acers can't log in so you pay for something you don't get. When I complained they did not offer me a free dongle with some hours of hotspot access. They only offered me the option to return it since I was within the 30 days. I did not. I like having it for 3G and wireless at home. Just annoys me that part of that $60/month is for hotspot access and AT&T won't discount it despite the fact that they advertise this netbook on the AT&T website and stores. Like I said: read the fine print. If you do not have AT&T connection manager you are not logging into their hotspots.

[jacob]

NETBOOKS ARE WORTHLESS, just get a 13 or 15in laptop if u want it to be small, and wifi is available a lot of places. if no wifi then if u are smart u can just tether a phones 3g to the notebook and wallah a good computer and cheap wireless access.

[digirandi]

net books are really simple and nicer to work with, and also its size is handy