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Call it the Netbook halo effect: small and cheap is infectious. A quick peek at the lineups of new laptops slated for the Windows 7 (October 22) roll-out make it clear that the prices of mainstream and higher-end laptops are diving, even as the technology gets better.

"There's a new reality in laptop pricing," said Bob O'Donnell, an analyst at market-researcher IDC. "It's getting harder and harder to sell anything over $800." O'Donnell cited a data point that showed the average selling price of notebooks falling below desktops briefly in retail. "That may have been an anomaly, but the fact that's it's even close is indicative of this phenomenon."

That said, let's start with HP, the world's largest PC supplier. Svelte, well-built business laptops have historically been priced at a premium--starting at more than $1,000. Not anymore. On October 22, HP will begin selling the 13-inch ProBook 5310m that is about 0.9 inches thin, less than four pounds, and clad in an aluminum display enclosure and a magnesium alloy bottom case for $699.

That's about $800 less than the HP EliteBook 2530p business notebook series introduced in August of last year (that started at about $1,500). The 5310m is priced at $699 with an Intel Celeron dual-core processor and $899 with Intel Core 2 Duo chip. Both come with the Windows 7 operating system.

That's what I call a sea change in pricing.

But it gets better. Then there's the 4-pound HP Pavilion dm3 notebook that starts at $549 (no, it's not a Netbook) and will likely range up to about $700 in price for a reasonable memory and hard drive configuration. The 13-inch laptop comes with power-efficient Intel Core 2 Duo or AMD Neo dual-core processors and a standard 6-cell battery that delivers--so HP claims--up to 10 hours of battery life.

I was able to play with a dm3 at a function sponsored by Advanced Micro Devices recently in San Francisco. My immediate impression was that this was a light but solid design.

The Apple $999 MacBook is suddenly… Read more