Do “Free Laptop” Mobile Broadband Deals Offer Consumers Value For Money?

November 12, 2009

We’ve all heard the phrase “There’s no such thing as a free lunch.” Well, the same goes for laptops.

During the last week we’ve broken down the so called “Free Laptop” mobile broadband offers to reveal the real costs for each laptop. We then compared some of them with the prices charged for the same laptop at popular online retailers such as Amazon, LaptopsDirect.co.uk and www.PCWorld.co.uk. Findings were mixed, with some providing good value and others being far from it.

Here’s how we calculate the real cost of the laptop over the course of your mobile broadband contract, with an example from 3:

Contract details: £25 per month over 24 months for 15GB of monthly data allowance

15GB of data without the laptop would cost £15 per month, so you pay an extra £10 each month for the laptop deal.

This means that the effective cost of the laptop, over your 24 month contract is:
£10 x 24 months = £240

This deal actually works out reasonably good value for money and receives one of our best-buy awards (details below).

So how do the rest of the offers stack up? Do they offer consumers value for money and the equivalent of a cheap credit agreement, or are the mobile networks taking advantage of a new and potentially confusing marketplace to overcharge their users on hardware?

Out of the eleven offers that we compared, we found that five of them offered either good or reasonable value for money, whereas six of them offered poor value. We also found a huge range of price differences: the best of the mobile networks’ offers worked out around £20 cheaper then buying your laptop separately and up-front, and the worst worked out 71% more expensive.

3 came out way out ahead in terms of providing laptops at a fair cost, with five good or reasonable value laptop offers, whilst none of the other providers currently have any laptop offers that we consider to be good value.

The MBS Best Buy Laptop Awards

We have two separate best-buy awards, which will be awarded each time we publish this report on a monthly basis.

The first is based purely on price – a comparison between the effective cost of the laptop over the course of a mobile broadband contract, versus the price charged for the same laptop at various online retailers.

This is the MBS Laptop Value Award, and goes to 3 this month for their Samsung R720 laptop offer.

The second award is based on both price comparison and a study of laptop reviews from various reputable sources to gain an insight into laptop performance versus price. Here, we’re looking for a laptop deal that not only offers the laptop at a reasonable price, but which also offers a laptop with value-for-money performance.

This is the MBS Laptop All-Rounder Award and also goes to 3 this month for their Samsung N130 laptop offer.

A Detailed Comparison

The Good (5)

Samsung R720 – MBS Laptop Value Award

Provider: 3
Deal Details: £40 month, 24 months, 15GB
Same Data Without Laptop: £15 per month
Difference: £25 per month
Effective Cost of Laptop: £25 × 24 months = £600

Laptop available separately at:
www.amazon.co.uk – £619

Verdict: Thumbs-up. This laptop costs less with 3 than it does if you buy it up-front at Amazon (we didn’t find it anywhere else) and your payments are spread over 24 months. Great deal.

Toshiba T130

Provider: 3
Deal Details: £40 per month, 18 months, 5GB data
Same Data Without Laptop: £15 per month
Difference: £25 per month
Effective Cost of Laptop: £25 × 18 months = £450

Laptop available separately at:
www.amazon.co.uk – £469

Verdict: Thumbs-up. Another great value deal from 3. At £19 less than you’d pay for the laptop up-front with Amazon and payments spread over 18 months, this is great value.

Samsung N130 – MBS Laptop All-Rounder Award

Provider: 3
Deal Details: £25 month, 24 months, 15GB
Same Data Without Laptop: £15 per month
Difference: £10 per month
Effective Cost of Laptop: £10 x 24 months = £240

Provider: 3
Deal Details: £20 month, 24 months, 1GB
Same Data Without Laptop: £10 per month
Difference: £10 per month
Effective Cost of Laptop: £10 x 24 months = £240

Laptop available separately at:
www.amazon.co.uk – 231.85
www.pcworld.co.uk – £231.85
www.laptopsdirect.co.uk – £231.97

Verdict: Thumbs-up. You can spread your payments over 24 months and pay just £8.15 more than the cheapest price we found elsewhere.

Compaq Mini 311

Provider: 3
Deal Details: £35 per month, 18 months, 5GB data
Same Data Without Laptop: £15 per month
Difference: £20 per month
Effective Cost of Laptop: £20 × 18 months = £360

Laptop available separately at:
www.amazon.co.uk – £349.36

Verdict: Thumbs-up. This is a good deal from 3 – you pay just over £10 more than you would when buying the laptop up-front from Amazon, and you spread your payments over 18 months.

Compaq CQ61

Provider: 3
Deal Details: £30 month, 24 months, 15GB
Same Data Without Laptop: £15 per month
Difference: £15 per month
Effective Cost of Laptop: £15 × 24 months = £360

Laptop available separately at:
www.amazon.co.uk – £339.99

Verdict: Thumbs-up. You’ll pay around £20 more with the 3 deal, than you would buying the laptop separately, but you may find that spreading the payment is worth the extra cost.

The Bad (6)

Samsung R519

Provider: 3
Deal Details: £35 month, 24 months, 15GB
Same Data Without Laptop: £15 per month
Difference: £20 per month
Effective Cost of Laptop: £20 x 24 months = £480

Laptop available separately at:
www.amazon.co.uk – £429
www.laptopsdirect.co.uk – £389.96

Verdict: Thumbs-down. The effective cost of this laptop on the 24 month contract from 3 is around £90 more than you’ll pay at www.laptopsdirect.co.uk if you buy the laptop up-front. Even if you take the option to spread payment over 36 months (1 year longer than the 3 contract) at laptopsdirect.co.uk you’ll only pay £470 – £10 less than the 3 deal.

Samsung R519

Provider: O2
Deal Details: £34.26 month, 24 months, 3GB
Same Data Without Laptop: £14.69 per month
Difference: £19.57 per month
One-off Initial Payment: £29.38
Effective Cost of Laptop: £19.57 × 24 months + £29.38 initial payment = £499.06

Laptop available separately at:
www.amazon.co.uk – £429
www.laptopsdirect.co.uk – £399.97

Verdict: Thumbs-down. At almost 25% more than buying the laptop up-front from LaptopsDirect.co.uk, this doesn’t represent value for money.

Toshiba L300

Provider: Orange
Deal Details: £29.36 month, 24 months, 3GB
Same Data Without Laptop: £14.68 per month
Difference: £14.68 per month
One-off Initial Payment: £65
Effective Cost of Laptop: £14.68 × 24 months + £65 initial payment = £417.32

Provider: Orange
Deal Details: £34.25 month, 18 months, 3GB
Same Data Without Laptop: £14.68 per month
Difference: £19.57 per month
One-off Initial Payment: £90
Effective Cost of Laptop: £19.57 × 18 months + £90 initial payment = £442.26

Laptop available separately at:
www.laptopsdirect.co.uk – £269.97

Verdict: Thumbs-down. With the cheapest of these Orange offers, the effective cost of the laptop is 54% more than buying the laptop separately from www.laptopsdirect.co.uk – our advice: buy separately!

Dell Inspiron Mini 10

Provider: Vodafone
Deal Details: £30 month, 24 months, 3GB
Same Data Without Laptop: £15 per month
Difference: £15 per month
Effective Cost of Laptop: £15 × 24 months = £360

Laptop available separately at:
www.pcworld.co.uk – £249.99

Verdict: Thumbs-down. You’ll save over £100 buying this laptop elsewhere. The effective cost of the laptop with Vodafone is 44% more than if you buy it up-front from www.pcworld.co.uk

Samsung N310

Laptop available separately at:
www.amazon.co.uk – £289.20
www.pcworld.co.uk – £294.70
www.laptopsdirect.co.uk – £308.97

Verdict: Thumbs-down. The effective cost of this laptop on the Orange 24 month contract is 44% more than you’ll pay if you buy the laptop up-front elsewhere. This means that you’re paying more than £120 extra with the Orange deal.

Compaq Presario

Provider: Vodafone
Deal Details: £40 per month, 24 months, 3GB data
Same Data Without Laptop: £15 per month
Difference: £25 per month
Effective Cost of Laptop: £25 × 24 months = £600

Laptop available separately at:
www.amazon.co.uk – £378.69

Verdict: Thumbs-down. Save over £200 by buying this laptop up-front from Amazon.

Laptops we couldn’t find elsewhere.

We didn’t find comparable laptop specifications for the models below, so we’ll simply provide you with the cost calculations.

Compaq Mini 700

Provider: Orange
Deal Details: £29.36 month, 24 months, 3GB
Same Data Without Laptop: £14.68 per month
Difference: £14.68 per month
Effective Cost of Laptop: £14.68 × 24 months = £352.32

Provider: Orange
Deal Details: £34.25 month, 18 months, 3GB
Same Data Without Laptop: £14.68 per month
Difference: £19.57 per month
One-off Initial Payment: £15
Effective Cost of Laptop: £19.57 × 18 months + £15 initial payment = £367.26

Asus 1000H GO

Provider: Orange
Deal Details: £29.36 month, 24 months, 3GB
Same Data Without Laptop: £14.68 per month
Difference: £14.68 per month
Effective Cost of Laptop: £14.68 × 24 months = £352.32

Provider: Orange
Deal Details: £34.25 month, 18 months, 3GB
Same Data Without Laptop: £14.68 per month
Difference: £19.57 per month
One-off Initial Payment: £10
Effective Cost of Laptop: £19.57 × 18 months + £10 initial payment = £362.26

Asus 1005H

Provider: O2
Deal Details: £24.48 month, 24 months, 3GB
Same Data Without Laptop: £14.69 per month
Difference: £9.97 per month
One-off Initial Payment: £29.38
Effective Cost of Laptop: £9.97 × 24 months + £29.38 initial payment = £268.66

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