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I'm sure it's possible to work out a per-copy price for Linux, but that number probably came from the cost of Windows XP Starter Edition, and the reporter got it muddled up.

http://www.google.com/search?q=windows%20%243

The nice thing though is that if you have some upfront developer/consultant cost for Linux that cost gets amortized over every netbook you crank out. I have no idea how the economics of this really works, but it would seem at least that the per-machine Linux price would keep falling toward zero.

I know that you can charge what ever you want for Linux and that the per unit price might be x dollars, but my gripe is that the New York Times article makes it sound like The Linux Company sets the price at $3/copy without any kind of explanation. You would think that they would give some background info on Linux, explaining why, as open source, it is fundamentally different (e.g. no single company controls it)and can affect the netbook pricing in this way.