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Tech Rumor of the Day: Verizon Netbooks

Verizon (VZ - Get Report) is preparing to enter the 3G netbook race.

At least one netbook has passed Verizon's rigid network compatibility test and others are in the works, says a company source who declined to name the computer manufacturers involved.

Analysts see the move as an answer to rival AT&T's (T - Get Report) recent netbook efforts. Earlier this month, AT&T announced it would sell netbooks for $99 through retailers like RadioShack (RSH) in exchange for two-year service contracts.

To date, Verizon has offered $100 and $200 rebates on more expensive laptops with two-year contracts, but the subsidized netbook category is an altogether new strategy for the New Jersey wireless joint venture half owned by Vodafone (VOD).

The subsidy war among wireless telcos really caught on last year after AT&T decided to discount Apple (AAPL - Get Report) iPhones. The move helped Apple more than triple the rate of iPhone sales, and it gave AT&T some sweet hand candy to lure customers away from competitors like Verizon, Sprint (S) and Deutsche Telekom's (DT) T-Mobile.

"Verizon and AT&T have each other in their respective cross hairs," says Nielsen wireless analyst Roger Entner, referring to the pitched battle to win the other company's customers.

Netbooks from outfits like Asus and Acer are wildly popular in these tough economic times. They sell for about $300 without a telco subsidy. If Verizon covers $200 of the tab and gets a customer locked in to a two-year contract, the payback will be six-fold. Verizon data plans are about $60 per month. Over two years, that's worth $1,440 to Verizon.
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