Warning: Free PCs Not as Cheap as You Think

A free lunch? Well, maybe. What about a free PC? That offer has surfaced in recent months. In fact, at least five companies plan to offer what appear to be sub-$30 PCs. PC World took a hard look at some of these offers, and guess what? There's still no such thing as a free PC--but there are some deals to consider.

Almost every company "giving away" a PC requires you to buy Internet access from it for three or four years--often at a slightly inflated price. In most cases, you shell out about $900 to $1000 over three years or so and get both the computer and Internet service. One company--Free-PC--plans to offer free PCs with no service-contract strings attached, but your screen will be cluttered with annoying advertising.

Free for a Fee

You have to do some math to figure what you'd ultimately pay for an Internet-supported PC. Take the monthly fee, subtract what you'd expect to pay for an ISP--say, $20 a month--and multiply the remainder by the number of months you must subscribe. Then add any fees and shipping costs.

You may incur another cost by committing to an ISP for several years. If an ISP grows too fast or loses key personnel, its service can suffer. Moreover, you could be locked into 56-kbps modem service while your neighbors enjoy much faster cable access.

Mixed Reviews

We tested two ISP-provided PCs--Gobi Computers' System and InterSquid's Basic Model--and we saw a demonstration of the Free-PC, the only advertisement-supported model announced at press time. Because all three products are either brand-new or not yet shipping, we couldn't test the vendors' service and support or the quality of their Internet access. Our conclusion: These PCs have attendant risks, but if you're short of cash, you can get a worthwhile bargain in a low-end home machine.

Gobi charges $75 for start-up and shipping fees, plus $26 a month for Internet access, and requires a three-year commitment. That adds up to $1011. But if you figure you'd probably spend $20 a month for access in any case, the real hardware cost is more like $291 over three years.

And the Gobi handled itself surprisingly well. Its PC WorldBench 98 score of 154, though nothing to e-mail home about, is more than acceptable for a Celeron-300 system. In fact, the Gobi came in just ahead of Emachines' Etower 366i, a $738 Celeron-366 system (for details, see "The Best PCs for Under $1000: How Low Can They Go?" ).

The Gobi you get is likely to have a faster processor than ours. After we'd tested the machine, the company announced that it was switching over to Celeron-333s. Gobi adds its own active desktop-based interface over Windows. Boot up, and you'll get wallpaper with links to popular sites; a help button; and a HotBot-based search field--nice for novices but annoying for experienced users who already know where they want to go. This desktop has one major problem: The optional wallpaper is designed for screen resolution of 1024 by 768 (Gobi's default), but viewed on the Gobi's 15-inch screen, that setup can be hard on the eyes.

The InterSquid Basic Model costs $30 a month for 30 months of access. Add shipping and handling charges, and you wind up paying $400 just for hardware. And judging from the review unit we tested, the system isn't worth it. We found the machine to be badly designed, flimsy, and rather slow. This Celeron-333 system scored 144 on PC Worldbench 98, not keeping pace with the Gobi despite its faster processor. InterSquid is contracting out to more than one manufacturer, so you might receive a better system than we did.

Microworkz Computer has plans to offer a low-priced Webzster Jr. system (which was not available for testing). When fully configured it will run you about $300, after you deduct the cost of a year of included Internet access. (For more about Microworkz, see On Your Side.)

Good Deals and Bad

Other companies with free offerings didn't have systems ready for us to sample. Both Simple Solutions and DirectWeb keep their monthly price at $20 (at least for their low-end systems) and hope to make a substantial portion of their income from electronic commerce and advertising.

If you want the whole Simple Solutions Enchilada, you have to pay for the company's Internet service for four years. DirectWeb doesn't ask you to subscribe for a set period of time, but if you hold on to the system for 36 months, you get to keep it. You can cancel your subscription whenever you want by returning the computer. And at the end of three years, you can buy the computer by forfeiting the otherwise-refundable $150 deposit.

Advertising Overload

While some free PCs subject you to advertising, only the Free-PC beats you over the head with it. Granted, you don't pay a dime for your Free-PC--it even comes with 30 months of free Internet access. The company hopes to make a profit by selling ads. In addition, you must provide personal information to the vendor in order to qualify for its largesse.

The PCs are given away through a lottery, so you may or may not get one. If you do win a Free-PC, you'll find nearly a third of the screen occupied by thick bands filled with blinking, ever-changing ads. Even when you're offline, working in your word processor, the busy screen looks like a garishly overdone Web site.

Like the Gobi, the Free-PC defaults to 1024 by 768 resolution. As a result, it renders text and images too small for you to view comfortably on the provided 15-inch monitor. But unlike the Gobi, the Free-PC doesn't let you change this setting. In fact, you're not permitted to do a lot of things on the Free-PC. You can violate the customer agreement by reinstalling your operating system, by partitioning your hard drive, or by using your computer for less than 10 hours a month.

Free-PC received over 1 million applicants for the first 10,000 systems, which are slated to ship in early June to winners of its lottery. The company expects to offer more PCs later this year, increasing your odds of getting one.

Free-PC is one of the few companies with free offerings that provides a name-brand machine. At press time, the company planned to give away Compaq systems based on Cyrix's 333-MHz M II chip.

Gift Horse?

If you need a second PC in the house, primarily for Internet access and word processing, a solid ISP-supported system such as the Gobi is worth considering. These PCs generally have basic support policies and full warranties similar to those of systems acquired in more traditional ways. The vendors also act as your ISP and handle support issues.

These systems make no sense for an office, where you probably already have Internet access--maybe with something faster than a modem--and don't need to pay a separate monthly fee to connect one system over the phone lines. And with a few higher-priced exceptions, such systems are too slow to make good gaming machines.

Offers of "free" PCs are alluring, and in some cases, the temptation is worth acting on. But be sure to check the fine print, and do the math.