Solid $500 Laptops

Is the idea of getting a capable notebook from a major vendor for just $500 too good to be true? Not if your needs are modest. Although such deals involve definite catches, our tests revealed that new bargain-basement models work well if you want a machine that handles e-mail, Web surfing, word processing, and other run-of-the-mill productivity chores.

We tested laptops from Acer, Dell, and HP's Compaq line; each company sells basic models for around $500 (after rebates). Gateway and IBM are also getting into the act: As we went to press, both were advertising units starting in the $500 range after rebates.

These ultralow-priced systems challenge the adage that even the most inexpensive laptops are costlier than the lowest-priced desktops. "Now consumers can buy the computer they want, not just the desktop they can afford," says Stephen Baker, an analyst who follows the retail PC market for NPD Techworld.

Thanks to strong sales of budget notebooks, in August 2005 more laptops than desktops sold at retail stores for the first time ever. Notebooks represented 52 percent of retail PC sales, according to NPD. The rise in sales corresponds to a fall in prices: The average cost of a notebook during August 2004 was $1350; in August of this year, it was $1100, NPD says.

See features comparison chart: "Acer Leads the Value Pack."