It sounds far too good to be true. They give you a free, brand-new PC, a modem and monitor, and a free Internet access account.
And the catch? Well, you have to supply some fairly detailed personal information (age, income, family status, information about personal tastes and so on). Then they use this data to target specific advertising at you - directly on your new PC's desktop. Even when you're offline.
This is the business plan of Free-PC, a US start-up founded by that well-connected Internet entrepreneur Bill Gross. Net Zero, another company aligned with Gross's IdeaLabs investment group, will provide the free Internet access.
All things considered, the PC is fairly impressive: a 333MHz Compaq Presario with 32MB of RAM, a 4GB hard drive, a 33.6
modem, CD-Rom and floppy drive, Windows 98 and a 15-inch, highres monitor. A great deal, even for a choosy PC buyer.
As the US prices of personal computers dipped below $1,000 and kept falling, it was only a matter of time before they started giving them away.
In the FAQs on Free-PC's website, the company explains: "Free-PC was founded in 1998 by Bill Gross to provide the power of personal computing to those who might not otherwise be able to have access to computers and the Internet." But if you strip away the pseudo-altruistic guff, there's an interesting business model here. It's a perfect example of modern "webonomics", and how giving things away for free can actually pay.
The free PC idea is bold and appealing, and it ties in to the willingness of advertisers to pay a lot for targeted consumers. But how does Free-PC expect to make its money? By advertising and e-commerce.
Bill Gross quotes studies showing that the annual e-commerce revenue per person in the US will soon overtake the cost of a PC. Free-PC pays up-front for the machines, then takes a 5 to 10 per cent cut of all e-commerce transactions, and sells the ad space - it has already signed up over 100 advertising partners. And its users might even like being targeted. As the people at Free-PC put it: "consumers don't dislike ads, they just dislike ads about products they aren't interested in."
Customers are also forced to use a particular start page: AltaVista. As for the adverts, they pop up in a border that frames the working area of the desktop, whether the PC is online or not.
This is the clever bit: the initial crop of ads is stored on the hard drive that ships with the PC. So, unlike the current wave of "banner ads" on the Web - animated gifs that look very flat and take ages to download - these PC-based ads can be far more "media-rich" and even include full-motion video.
But what happens when this pool of ads on the free PC goes out of date? This is the other clever bit: the pool will be updated in the background while the PC is online. So you can forget about half of that hard drive they've just given you. Free-PC says it will be using "at least 2 gigabytes" to store the ads. There's also the warning note in the small print that you don't get the machines for ever: they will be "made available free of charge for two years" to an initial wave of 10,000 "qualified applicants" - people fitting Free-PC's chosen demographic mix, which also means applicants from Ireland are unlikely to be considered.
mick@volta.net