and 'Low Cost' PC Offers.
You've probably seen the ads for
"low cost" PC's -
"PC's for $199" -
or even "free" computers. If
you're in the market for a personal computer, the Federal Trade Commission wants you to
know that "free" doesn't always mean free. Very often, certain conditions and
restrictions found in the fine print of advertisements for "free" or "low
cost" PC's can turn a so-called deal into a big ticket buy.
"Free" or "low-cost" PC offers often require "bundled"
Internet service contracts, which may last up to three years. In return for signing up for
Internet service, you can get as much as a $400 rebate on the computer purchase. While
some of these offers can be good deals, many are not as affordable as they may seem.
Frequently, important details about the rebate and Internet service offer are difficult to
ferret out because they're left out of the advertising or buried in the fine print.
To get a "low cost" PC, you may have to pay the full cost of
the computer up front - that is, the total price without any rebates. If the PC is
advertised for $199 after rebates, you may have to pay $599, plus any sales tax and
shipping charges, and then send for the $400 rebate.
Usually, you have to apply for the rebate in writing, mail in documentation of the sale
and then wait - sometimes months
- until you receive your rebate check. Sometimes
"instant" rebates are offered and you can get your deduction immediately. But
some offers allow you to spend the rebate only on other merchandise from the
manufacturer or retailer, meaning you still have to pay the full price for the computer.
When you buy a "free" or "low cost" computer, you often
have to sign up for three years of Internet service at $20-$30 a month
- a total cost of up
to $1,000 for three years. Technology is changing at a dizzying pace. It's possible that
the three-year Internet service you lock in today could be out of date in six months or a
year. And if you'd like to cancel your service, you'll likely have to pay a substantial
If you decide to cancel your Internet service for any reason, chances are you'll have
to pay back some or all of the rebate you received; you also may have to pay a
cancellation fee of $50 or more.
If you don't live in a major metropolitan area, you may have to pay long distance
telephone charges to access the Internet. Or you also may be able to use a
"toll-free" (800, 888 or 877) number supplied by the Internet Service Provider
(ISP), but you may be charged five or six dollars an hour to use their
"toll-free" number. Whether you choose to use the ISP's telephone number or pay
long-distance charges, your phone calls to access the Internet could add up to more than
you'll save through the rebate.
If the PC offer requires you to sign-up for Internet service, ask the retailer and the
ISP for the Internet access phone numbers closest to you. Then check with your local phone
company to determine whether you have to pay long distance rates to use those phone
numbers. You may want to consider another offer if the "deal" you're considering
requires you to call long distance or pay a fee to access the Internet.
It's possible that the cost of a monitor or other crucial system components
may not be included in the PC offer you're considering. The advertisements for the offer
may not be clear about what's included. If you have to buy a monitor, for example, plan on
spending at least an additional $150.
When considering a "free" or "low cost" PC offer, ask the retailer
about up-front costs, rebates, essential components, Internet access costs, long-term
commitments, cancellation policies, local or long distance phone access and any other
important issues. Details will help you make the deal that's right for you.
Filing a Complaint
If you think you've been misled about a "free" or
"low-cost" PC offer, contact the Federal Trade Commission.
The FTC works for the consumer to
prevent fraudulent, deceptive and unfair business practices in the
marketplace and to provide information to help consumers spot, stop and
avoid them. To file a
complaint or to get free information
on consumer issues, visit
call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The
FTC enters Internet, telemarketing, identity theft and other fraud-related
Consumer Sentinel, a
secure, online database available to hundreds of civil and criminal law
enforcement agencies in the U.S. and abroad.
FEDERAL TRADE COMMISSION
FOR THE CONSUMER