Issue #190, March 3, 1999  

Anyone Want A Free PC? There's A Catch 

By Stephen Lawton

     Some said it couldn’t be done.  Others said it was inevitable. Some thought it was just, plain silly. Finally, the concept of computers becoming so inexpensive that they become free is a reality. There’s a catch, of course, but the hardware is nonetheless free. 
     The catch is eyeballs — and demographics. Bill Gross of idealab! is the mastermind of the free PC.  In fact, Free-PC Inc. (Thousand Oaks, CA) is the name of the service he’s starting. Here’s the deal: If you come from a household with the right demographics, promise to log on to the Internet at least 10 hours a month, and agree to have part of your screen filled with Free-PC advertising for the next three years, then you could be a candidate for a free PC.  And this is no shoddy box with 1988 parts and a nine-inch monitor — we’re talking about a Compaq Presario with a 15-inch monitor.  This is a 333MHz desktop multimedia system with 32MB of RAM, CD-ROM, 33.6Kbps modem, Compaq’s Internet keyboards and a 4GB hard disk.  Well, it is a 4GB disk, but the user has only 2GB available — the rest is filled with adds and related data. 
     Incidentally, because the ads are stored on the hard disk and not fed from some remote server, ads will be displayed whenever the computer is being used, not just when the person is online. It’s not enough now to hit you with lots of ads when you’re checking out your e-mail, as is the case with many of the free e-mail services; now they get you offline too. 
     Of course, to make this happen, Free-PC is working with ISPs that are willing to provide the free (there’s that word again) Internet access. While 33.6Kbps might not be blazing fast speed compared to xDSL and cable modems, it works just fine for many of today’s major Web sites. 
     Does all of this make any sense?  In many ways, it does. Assuming that it costs approximately $500 for an ISP to sign up a new customer, giving away a $500 PC to guarantee a customer makes financial sense. At worst it’s break-even; at best it could be the start of something really big. 
     Just think of the ramifications: Today you need to commit to three years of ads for a “free” $500 PC. What if Ford decided to “give away” the Taurus. Many Taurus and former Taurus owners will agree that one of the best ads Ford could place around the windshield are the names, addresses and phone numbers for transmission mechanics. (Of course, you can localize it for a premium price, so you get just Orange Country mechanics if your Zip Code is 92705, for example.) And when you roll up the windows, you get a complete list of tire dealers. Pop open the trunk and down falls a 3-D foldout of auto insurance companies. And the rear-view mirror has a tiny screen running the latest infomercials on car wax (call now — operators are standing by). 
     This is just the beginning. Today the PC. Tomorrow the free car. By the end of next week, you’ll never need to spend your money on any infrastructure product — but then, you won’t have any money left anyway because you’ll have spent it all on the advertised products promoted on your computer, car, microwave oven door, telephone, et. al. 

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