Consider how much prices drop on computer component, by the time when your 3 year $400 warranty reaches the end, your laptop losts 2/3 or more of its value.
Reliability problems usually come with a bathtub curve: lots of initial defects that should be fixed under warranty free, then a long period of reliable operation, then the problems start to show up. So by the time you use the extended warranty, you are using your $400 warranty on a $500 laptop (statistically).
Also consider the fact that when you can choose to bail on the $500 laptop by either buying a used one on ebay (well, assume it is a legit seller selling a good laptop) or craigslist with $100 overhead, or put up with the problem insurance company throw at you and all the stress, I wouldn't call extended warranty a good deal at all. There is a reason they make so much money, with a 1/27 claim rate it is more money than selling you the laptop. Also when you already paid, the insurance company has much fewer incentives to keep you happy and/or offer you a better deal (personal experience with car extended warranty not covering head gasket, WTF).
Also consider the fact that the most frequent and expensive repair (battery) are not covered, and used parts are so plentiful and cheap used on craigslist or ebay, why bother buying so much insurance?
If you can't afford to take a risk on not having the insurance, buy it, but if you need to buy it for a small item like laptop, you probably should buy a cheaper laptop or spend more on a better quality laptop anyways. Just like a car, I would rather buy a reliable car with $1000 more than a lemon and a free $1000 value warranty.
It depends on how much you pay for the laptop initially and how important it is for you to keep your system running without a lot of down time. As I pointed out in the article, I think failure rates for laptops are WAY higher than 1/27. That sounds like failure rates for a desktop in the first year, if that. My experience with laptops is that before the second year is over, failure rates may be as high as 50%; certainly 33%. Some laptops are better than others, but even if it's only 10-20% that's still a lot.
If you grab a business notebook from Dell or HP (or similar companies) you can get a 3-year warranty with on-site service. Usually, that means going to a local service center, but there's certainly no huge hassle with tech support. If you get a cheap warranty where you have to send in the laptop, it may not be worth the trouble.
So, if you buy a ~$2000 laptop, after two years it's still usually worth at least $1000. By the end of three years it's down to around $700. After that your warranty is over regardless. Very likely, you will have something break before the three year period is over... at least if you carry your laptop around a lot (which is ostensibly the whole point of a portable computer).
That's true, it matters how much it cost as a percentage of the initial price, and how good the service is (instant replacement and keeping your original HD would be nice, as IT dept of work place).
My experience with cars and manufacturing warranty is usually not as easy as getting replacement parts myself and fix it, or sell it on ebay and buy another one.
I just configured a Dell laptop that cost $1350.00 While I didn't get the spiffy in home warranty I did buck up for the 3 years at the price of 149.00.
I hadn't read this blog at the time but you know I figured it was worth it overall when it comes to a laptop. A one year standard warranty is not enough, not when you consider that most are intended for use for atleast 2-3 years.
I have a Toshiba R-100 ultraportable. Now nearing the end of its 4th year. A pretty expensive "executive class" laptop ($3000 but I got it for about half that price) and very well built. I had the LCD screen develop major spottiness problems and had to be replaced in the first year and I had a hard drive failure in the 3rd year. Plus another hard drive failure early on which I fixed and paid for myself because it was my fault (and 1.8" drives are very flimsy).
Luckily though, Toshiba provides 3 year warranty on their executive class notebooks. Plus all you need to do is find an authorized service depot in your town (there's at least a dozen in Vancouver), take it there and wait about a week for them to fix it.
There's no way I would ever buy a laptop that doesn't have either at least a 2 year warranty - or alternately get an extended warranty. However, this only applies to buying a laptop that costs well over $1000. I wouldn't get an extended warranty for a cheap laptop. But an expensive laptop should come with at least 2 year warranty anyway - if it doesn't, it's a major strike against that model when it's time to make a purchasing decision. After all, extra several hundred dollars is a pretty important factor.
I got a 3 year warranty when I bought my laptop 2 years ago. Just a few weeks ago the graphics processor went out on it. Called up support and I had a guy at my door the next day with a new part.
How much more transparent can the intent of this blog be? Obviously you are in bed with the laptop companies. How many extended warranties have you purchased for your personal laptops?
Yes, I'm making the laptop companies very happy by saying, "I have serious concerns about the long-term reliability of laptops. Most seem to start having problems withing three years." If I'm lying about that to try to get people to buy unnecessary warranties, I'm trying to sell people on buying a lemon car with a good warranty rather than a good car with no warranty. I haven't done car sales, but I don't think that would work.
"Hey, you should get this Camry, but make sure you get an extended warranty because the car is really only good for the first 50K miles. After that, you're going to have regular repair costs! Upgrade to the 100K warranty and then all you have to do is take the car in for service every 5-10K after the first five years of use. Isn't that super convenient?"
LOL... I'm sincerely hoping that you were just kidding. If not, can you tell me whom I need to contact to get my kick-back checks? Because I haven't seen any. :(
Tell you what, Jarred. Next time you buy a laptop, send me $400 and I'll save it for you. If it fails at some point in the following three years, call me up and I'll speak with an Indian accent and give you the runaround for a few days. If you're persistent, I might actually let you send me the laptop, at which point I'll lose it for a few weeks. Then I'll fix your laptop and send it back to you, only I'll reformat the hard drive.
Then buy a Thinkpad. You talk to someone in Atlanta when you call, you get a DHL box the next day, and your system back a day or two after that.
I've long given friends the same advice as here. In a desktop, extended warranties are a ripoff as for most systems any one component is worth roughly as much or less than the cost of the warranty. So if you only have to replace one thing you come out even or ahead, multiple repairs and you might lose out. Laptops OTOH I recommend the warranty for, as far less stuff is user-replaceable and parts are more expensive. Also, I don't know anyone who has a laptop that sees even moderate use and has not had some issue with it. A friend in college had the screen of her laptop replaced at least 3 times under warranty, as it kept developing bright spots at the same location on the screen, and the on-campus repair place was willing to replace it under warranty.
Did I forget to mention I would want local support - the "at home" service is the way to go. If I have to ship my computer off for a few days, I'm not going to be pleased at all....
If the notebook/laptop spends more time turned on than powered down, then I would suggest a extended warranty is a must for most notebooks. At one point I went around telling people I was Folding@home on my laptop, and I got a kick out of how many people were shocked, either because they thought a laptop wasn't designed for heavy use or because of overheating concerns. (A little undervolting negated any heat/fan noise issues, even after the notebook cooler itself had long perished)
My point is, the longer extended warranties also serve a second purpose that can directly benefit you, besides peace of mind or insurance. Sure that old beast of a laptop may not compare to the new advances in technology sitting on the shevles, but meanwhile until then you can get full use out of your laptop knowing when it breaks and they can't replace the part, they give you an upgrade or a off-the-shelf comparable system.
No heavily used laptop will be lasting four years including those that are regularly maintained and well treated, so the longer 3-5 year warranty plans guarantee you a new system in the future. My Dell notebook lasted one year and one month before the GPU went bad, and I got a GPU upgrade from a GO 6800Ultra to a GO 7800GTX for nothing. Of course other parts wore out soon after that, but today if anything breaks I’d be getting one heck of a laptop upgrade as not even the Pentium M CPU is used anymore.
I was a bit surprised to read the last paragraph. This is the first time that I have seen someone that is fairly knowledgeable about computers recommending an extended warranty. Granted, that recommendation is only for a specific case, but since notebooks are being purchased more than desktops now, it becomes a significant issue.
With that said, I can't say that I completely disagree with the conclusion either. It is far too easy to damage a notebook computer. Anything that is being used for business purposes is bound to get significant abuse compared to a desktop. The good thing with work computers though is that they are often supplied by the employer. So, it is up to the IT staff to decide what should be done with regard to warranties, and you would really have to look at your own environment with relation to economies of scale to determine the need for extended warranties in that case.
If you own a personal laptop, you can probably gauge your own need for an extended warranty by any other extended warranties you may have used (or needed) on portable electronic equipment (PDA, cell phone, iPod, etc.) in the past. If you are hard on your devices, you are likely to need that warranty. If not, it's probably money down the drain.
Overall, I still don't think that an extended warranty is worth it for personal use unless you just don't know how to take care of your stuff. If you're in an IT department, economies of scale make extended warranties less attractive as well, but that doesn't mean that they aren't worth it in some circumstances.
I should probably clarify that if I were to go out and buy a laptop right now, more likely than not I would be shopping in the small business offerings that often include a 3-year warranty. I don't use laptops for gaming - that's what my desktop is for - so if anyone asks me what laptop to buy these days I'm more likely than not going to recommend HP, Dell, Gateway, or Apple. ASUS is decent as well, but prices are usually higher. If they specifically want something with the ability to run games, things change a bit.
I've had an iBook for about 5 years and so far so good. I've had a PowerBook for 3 years, and so far so good. At the same time, I have a friend that had a REALLY high end PowerBook go out in about 15 months and he didn't get a warranty, it cost $800.00 to replace the motherboard. (Somehow I feel that since he spent a little over $3000.00 on that computer, it should have been covered under some special "damn you're a REALLY good customer complimentary service agreement".)
Anyhow, it's all about your comfort level, knowing how to prevent bad situations and firm gentleness (I don't "baby" my laptops, I just handle them steadily). By comfort level, I mean it's like any other insurance. I think in the case of the $3000.00 laptop, it was clearly a bad call not to get an extended warranty... but EVEN THEN, the cost of repair was $800.00. What would you rather, pay $300.00 FOR SURE, or maybe pay $800.00?
If you get a decent $800.00 laptop, adding another $200-$300 to insure it to a limited degree really sours the deal for me. Especially since it could still be stolen or lost (More likely than dropping it, at least for me). Another way to look at it for me is, it would have been $250.00 to insure the iBook, and $300.00 to insure the PowerBook... so let's just pretend I socked that insurance fee money away instead. Now I have $550.00 already, so adding another $200.00 to that and I have one heck of an insurance plan... it covers up to $750.00 of damages on my $800.00 laptop. Isn't that something?
As for insurance, at least where I come from, house insurance can usually cover if you drop your laptop and break it. Of course that is if you have house insurance of any sort. Then of course your premiums go up a bit too.
I think insurance is best left for things that can really derail you. There's a reason there's huge margins on computer insurance.
When you get insurance work it's also not quite the same. For instance, you may decide that you want to maintain your laptop with a RAM upgrade. In fact, a common thing that gives your laptop longevity is having a healthy battery (so it probably needs to be replaced every year or two)... but it doesn't cover you.
See in this case, it's so affordable to provide your own insurance, that you should do so. You will be far more flexible than any company on what to repair, what to replace etc.
To each their own, I know I will continue to not buy insurance on most of my computers and just deal with issues as they come if they come.
One more thing though: if you have a $3000.00 and are completely uncomfortable using it b/c it's so pricey and you're afraid you might loose it, then by all means get the insurance so that you can go on with your life.
True - there's a balancing act to consider. I'm thinking more along the lines of $2000 laptops. I wouldn't bother with a $400 warranty on a $1000 laptop, and it's odd how often warranty prices seem to be static with some bigger OEMs. The same warranty that costs $400 to cover anything and everything on a budget notebook applies to high-end $4000 notebooks. My own experience is that long-term, most notebooks tend to have significant problems within three years.
As technology rises laptop evolves its quality. It is the user responsibility on how to expand the life of his laptop. Anyway we can also consider this blog reading
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PandaBear - Thursday, December 13, 2007 - link
Consider how much prices drop on computer component, by the time when your 3 year $400 warranty reaches the end, your laptop losts 2/3 or more of its value.Reliability problems usually come with a bathtub curve: lots of initial defects that should be fixed under warranty free, then a long period of reliable operation, then the problems start to show up. So by the time you use the extended warranty, you are using your $400 warranty on a $500 laptop (statistically).
Also consider the fact that when you can choose to bail on the $500 laptop by either buying a used one on ebay (well, assume it is a legit seller selling a good laptop) or craigslist with $100 overhead, or put up with the problem insurance company throw at you and all the stress, I wouldn't call extended warranty a good deal at all. There is a reason they make so much money, with a 1/27 claim rate it is more money than selling you the laptop. Also when you already paid, the insurance company has much fewer incentives to keep you happy and/or offer you a better deal (personal experience with car extended warranty not covering head gasket, WTF).
Also consider the fact that the most frequent and expensive repair (battery) are not covered, and used parts are so plentiful and cheap used on craigslist or ebay, why bother buying so much insurance?
If you can't afford to take a risk on not having the insurance, buy it, but if you need to buy it for a small item like laptop, you probably should buy a cheaper laptop or spend more on a better quality laptop anyways. Just like a car, I would rather buy a reliable car with $1000 more than a lemon and a free $1000 value warranty.
JarredWalton - Thursday, December 13, 2007 - link
It depends on how much you pay for the laptop initially and how important it is for you to keep your system running without a lot of down time. As I pointed out in the article, I think failure rates for laptops are WAY higher than 1/27. That sounds like failure rates for a desktop in the first year, if that. My experience with laptops is that before the second year is over, failure rates may be as high as 50%; certainly 33%. Some laptops are better than others, but even if it's only 10-20% that's still a lot.If you grab a business notebook from Dell or HP (or similar companies) you can get a 3-year warranty with on-site service. Usually, that means going to a local service center, but there's certainly no huge hassle with tech support. If you get a cheap warranty where you have to send in the laptop, it may not be worth the trouble.
So, if you buy a ~$2000 laptop, after two years it's still usually worth at least $1000. By the end of three years it's down to around $700. After that your warranty is over regardless. Very likely, you will have something break before the three year period is over... at least if you carry your laptop around a lot (which is ostensibly the whole point of a portable computer).
PandaBear - Friday, December 14, 2007 - link
That's true, it matters how much it cost as a percentage of the initial price, and how good the service is (instant replacement and keeping your original HD would be nice, as IT dept of work place).My experience with cars and manufacturing warranty is usually not as easy as getting replacement parts myself and fix it, or sell it on ebay and buy another one.
I also don't spend more than $1000 for a laptop.
Christoph Katzer - Sunday, December 9, 2007 - link
I had an ASUS laptop for about 5 years now and in all that time it has been running great. I hope my next one from Dell will stick up to that time...just4U - Tuesday, December 11, 2007 - link
I just configured a Dell laptop that cost $1350.00 While I didn't get the spiffy in home warranty I did buck up for the 3 years at the price of 149.00.I hadn't read this blog at the time but you know I figured it was worth it overall when it comes to a laptop. A one year standard warranty is not enough, not when you consider that most are intended for use for atleast 2-3 years.
andrew007 - Tuesday, December 4, 2007 - link
I have a Toshiba R-100 ultraportable. Now nearing the end of its 4th year. A pretty expensive "executive class" laptop ($3000 but I got it for about half that price) and very well built. I had the LCD screen develop major spottiness problems and had to be replaced in the first year and I had a hard drive failure in the 3rd year. Plus another hard drive failure early on which I fixed and paid for myself because it was my fault (and 1.8" drives are very flimsy).Luckily though, Toshiba provides 3 year warranty on their executive class notebooks. Plus all you need to do is find an authorized service depot in your town (there's at least a dozen in Vancouver), take it there and wait about a week for them to fix it.
There's no way I would ever buy a laptop that doesn't have either at least a 2 year warranty - or alternately get an extended warranty. However, this only applies to buying a laptop that costs well over $1000. I wouldn't get an extended warranty for a cheap laptop. But an expensive laptop should come with at least 2 year warranty anyway - if it doesn't, it's a major strike against that model when it's time to make a purchasing decision. After all, extra several hundred dollars is a pretty important factor.
iootnega - Tuesday, December 4, 2007 - link
I got a 3 year warranty when I bought my laptop 2 years ago. Just a few weeks ago the graphics processor went out on it. Called up support and I had a guy at my door the next day with a new part.CandiKane - Tuesday, December 4, 2007 - link
How much more transparent can the intent of this blog be? Obviously you are in bed with the laptop companies. How many extended warranties have you purchased for your personal laptops?JarredWalton - Thursday, December 6, 2007 - link
Yes, I'm making the laptop companies very happy by saying, "I have serious concerns about the long-term reliability of laptops. Most seem to start having problems withing three years." If I'm lying about that to try to get people to buy unnecessary warranties, I'm trying to sell people on buying a lemon car with a good warranty rather than a good car with no warranty. I haven't done car sales, but I don't think that would work."Hey, you should get this Camry, but make sure you get an extended warranty because the car is really only good for the first 50K miles. After that, you're going to have regular repair costs! Upgrade to the 100K warranty and then all you have to do is take the car in for service every 5-10K after the first five years of use. Isn't that super convenient?"
LOL... I'm sincerely hoping that you were just kidding. If not, can you tell me whom I need to contact to get my kick-back checks? Because I haven't seen any. :(
Foxy1 - Tuesday, December 4, 2007 - link
Tell you what, Jarred. Next time you buy a laptop, send me $400 and I'll save it for you. If it fails at some point in the following three years, call me up and I'll speak with an Indian accent and give you the runaround for a few days. If you're persistent, I might actually let you send me the laptop, at which point I'll lose it for a few weeks. Then I'll fix your laptop and send it back to you, only I'll reformat the hard drive.strikeback03 - Tuesday, December 4, 2007 - link
Then buy a Thinkpad. You talk to someone in Atlanta when you call, you get a DHL box the next day, and your system back a day or two after that.I've long given friends the same advice as here. In a desktop, extended warranties are a ripoff as for most systems any one component is worth roughly as much or less than the cost of the warranty. So if you only have to replace one thing you come out even or ahead, multiple repairs and you might lose out. Laptops OTOH I recommend the warranty for, as far less stuff is user-replaceable and parts are more expensive. Also, I don't know anyone who has a laptop that sees even moderate use and has not had some issue with it. A friend in college had the screen of her laptop replaced at least 3 times under warranty, as it kept developing bright spots at the same location on the screen, and the on-campus repair place was willing to replace it under warranty.
JarredWalton - Tuesday, December 4, 2007 - link
Did I forget to mention I would want local support - the "at home" service is the way to go. If I have to ship my computer off for a few days, I'm not going to be pleased at all....Kougar - Tuesday, December 4, 2007 - link
If the notebook/laptop spends more time turned on than powered down, then I would suggest a extended warranty is a must for most notebooks. At one point I went around telling people I was Folding@home on my laptop, and I got a kick out of how many people were shocked, either because they thought a laptop wasn't designed for heavy use or because of overheating concerns. (A little undervolting negated any heat/fan noise issues, even after the notebook cooler itself had long perished)My point is, the longer extended warranties also serve a second purpose that can directly benefit you, besides peace of mind or insurance. Sure that old beast of a laptop may not compare to the new advances in technology sitting on the shevles, but meanwhile until then you can get full use out of your laptop knowing when it breaks and they can't replace the part, they give you an upgrade or a off-the-shelf comparable system.
No heavily used laptop will be lasting four years including those that are regularly maintained and well treated, so the longer 3-5 year warranty plans guarantee you a new system in the future. My Dell notebook lasted one year and one month before the GPU went bad, and I got a GPU upgrade from a GO 6800Ultra to a GO 7800GTX for nothing. Of course other parts wore out soon after that, but today if anything breaks I’d be getting one heck of a laptop upgrade as not even the Pentium M CPU is used anymore.
hands - Tuesday, December 4, 2007 - link
I was a bit surprised to read the last paragraph. This is the first time that I have seen someone that is fairly knowledgeable about computers recommending an extended warranty. Granted, that recommendation is only for a specific case, but since notebooks are being purchased more than desktops now, it becomes a significant issue.With that said, I can't say that I completely disagree with the conclusion either. It is far too easy to damage a notebook computer. Anything that is being used for business purposes is bound to get significant abuse compared to a desktop. The good thing with work computers though is that they are often supplied by the employer. So, it is up to the IT staff to decide what should be done with regard to warranties, and you would really have to look at your own environment with relation to economies of scale to determine the need for extended warranties in that case.
If you own a personal laptop, you can probably gauge your own need for an extended warranty by any other extended warranties you may have used (or needed) on portable electronic equipment (PDA, cell phone, iPod, etc.) in the past. If you are hard on your devices, you are likely to need that warranty. If not, it's probably money down the drain.
Overall, I still don't think that an extended warranty is worth it for personal use unless you just don't know how to take care of your stuff. If you're in an IT department, economies of scale make extended warranties less attractive as well, but that doesn't mean that they aren't worth it in some circumstances.
JarredWalton - Tuesday, December 4, 2007 - link
I should probably clarify that if I were to go out and buy a laptop right now, more likely than not I would be shopping in the small business offerings that often include a 3-year warranty. I don't use laptops for gaming - that's what my desktop is for - so if anyone asks me what laptop to buy these days I'm more likely than not going to recommend HP, Dell, Gateway, or Apple. ASUS is decent as well, but prices are usually higher. If they specifically want something with the ability to run games, things change a bit.gochichi - Tuesday, December 4, 2007 - link
I've had an iBook for about 5 years and so far so good. I've had a PowerBook for 3 years, and so far so good. At the same time, I have a friend that had a REALLY high end PowerBook go out in about 15 months and he didn't get a warranty, it cost $800.00 to replace the motherboard. (Somehow I feel that since he spent a little over $3000.00 on that computer, it should have been covered under some special "damn you're a REALLY good customer complimentary service agreement".)Anyhow, it's all about your comfort level, knowing how to prevent bad situations and firm gentleness (I don't "baby" my laptops, I just handle them steadily). By comfort level, I mean it's like any other insurance. I think in the case of the $3000.00 laptop, it was clearly a bad call not to get an extended warranty... but EVEN THEN, the cost of repair was $800.00. What would you rather, pay $300.00 FOR SURE, or maybe pay $800.00?
If you get a decent $800.00 laptop, adding another $200-$300 to insure it to a limited degree really sours the deal for me. Especially since it could still be stolen or lost (More likely than dropping it, at least for me). Another way to look at it for me is, it would have been $250.00 to insure the iBook, and $300.00 to insure the PowerBook... so let's just pretend I socked that insurance fee money away instead. Now I have $550.00 already, so adding another $200.00 to that and I have one heck of an insurance plan... it covers up to $750.00 of damages on my $800.00 laptop. Isn't that something?
Ratinator - Tuesday, December 4, 2007 - link
As for insurance, at least where I come from, house insurance can usually cover if you drop your laptop and break it. Of course that is if you have house insurance of any sort. Then of course your premiums go up a bit too.gochichi - Tuesday, December 4, 2007 - link
I think insurance is best left for things that can really derail you. There's a reason there's huge margins on computer insurance.When you get insurance work it's also not quite the same. For instance, you may decide that you want to maintain your laptop with a RAM upgrade. In fact, a common thing that gives your laptop longevity is having a healthy battery (so it probably needs to be replaced every year or two)... but it doesn't cover you.
See in this case, it's so affordable to provide your own insurance, that you should do so. You will be far more flexible than any company on what to repair, what to replace etc.
To each their own, I know I will continue to not buy insurance on most of my computers and just deal with issues as they come if they come.
One more thing though: if you have a $3000.00 and are completely uncomfortable using it b/c it's so pricey and you're afraid you might loose it, then by all means get the insurance so that you can go on with your life.
JarredWalton - Tuesday, December 4, 2007 - link
True - there's a balancing act to consider. I'm thinking more along the lines of $2000 laptops. I wouldn't bother with a $400 warranty on a $1000 laptop, and it's odd how often warranty prices seem to be static with some bigger OEMs. The same warranty that costs $400 to cover anything and everything on a budget notebook applies to high-end $4000 notebooks. My own experience is that long-term, most notebooks tend to have significant problems within three years.abieanarna - Tuesday, May 8, 2012 - link
As technology rises laptop evolves its quality. It is the user responsibility on how to expand the life of his laptop. Anyway we can also consider this blog reading