Carriers to sell majority of mobile devices by '13

More mobile carriers are offering Netbooks as a way to lure new customers--a trend that's likely to surge and encompass notebooks as well.

Hewlett-Packard Mini 1151NR via Verizon Wireless.

Credit: Verizon Wireless

By 2013, more than 60 percent of all mobile devices, including Netbooks and notebooks, are expected to be sold directly by wireless carriers, according to research released Wednesday by In-Stat. Almost 31 percent of notebooks alone will be sold through carriers, In-Stat predicts.

Bundling an inexpensive Netbook or notebook is a small price to pay for a carrier, which can then charge customers for a monthly data plan.

"In the U.S., carriers are charging up to $60 per month for a two-year contract with the subsidized purchase of a Netbook," In-Stat analyst Jim McGregor said in a statement. "While the subsidy costs the carrier $50 to $100, it generates $1,440 or more in service fees over the life of the contract."

Carriers such as Verizon Wireless, AT&T, and Sprint have already been dangling Netbooks as carrots to attract more mobile customers. Verizon is selling Netbooks from Hewlett-Packard and Gateway. AT&T is selling Dell, Acer, and Lenovo Netbooks, as well as a Nokia Booklet 3G. Sprint is also selling a Dell Netbook.

Thanks to the success of low-cost Netbooks, U.S. carriers are further testing the waters by bundling full-size notebooks along with a two-year contract. The strategy isn't just limited to the United States, noted In-Stat. Carriers in Europe and Asia are giving out Netbooks with a data plan, but often at lower prices than in the U.S. Asian carriers have also been offering the kissing cousins of Netbooks: mobile Internet devices and ultramobile PCs.

This trend will intensify as carriers boost the number of services offered and cut prices on those services due to higher competition and better bandwidth, In-Stat said. The mobile market itself is also expected to become more attractive, with richer content and increased bandwidth.

[vaibhav92]

Funny to see how US markets are still bound by carrier interests. To get the true feel of "The Free World" look how asian mobile markets have evolved in biggest market.

[john55440]

Qwest (telco) internet service includes free access to wi-fi hot-spots. (AT&T, I think.)

As a promotion, they recently offered a discount on a Dell netbook.

[MadLyb]

In-stat makes a fundamental assumption that data plans will continue to be doled out by device, instead of the consumer, which will fund subsidizing these devices and therefore making the price competitive with retailers.

However, I think we are all getting rather tired of paying for access in this manner versus traditional Internet access methods, so most consumers will not buy into this limited the sales of these devices through carriers. Then, if the carriers do get a clue and open up a consumer, not device approach, then they will not be able to subsidize the products off of contracts limiting their ability to compete with retailers.

In short, In-stat missed the ball on this one.

[gerrrg]

Doubt it.

[Renegade Knight]

I think this is wishful thinking, but I could be wrong. Power users won't want to be tied to what's essentially a slow, non shareable, data cap ridden, crappy, and expensive ISP. However perhaps most folks don't care enough to pay any attention and would rather pay more for the less they get because it comes in a handy montly payment.

[clamenza]

// However perhaps most folks don't care enough to pay any attention and would rather pay more for the less they get because it comes in a handy montly payment. //

Or maybe they don't need fancy touch-screens or massive data plans (or any data plan at all), and so are happy with free or almost-free devices doled out with a monthly contract they'd have to pay anyway.