There is such a thing as a free PC

Last year there was much talk about ISPs giving low-end PCs away with a monthly subscription to their service. However, unlike the Americans, we Brits hadn't really been used to paying a monthly subscription for our phone calls, and the idea never really took off.

At the end of last month the US Federal Trade Commission issued a formal warning to those who may be tempted by the offers, saying that there had been a number of cases highlighting the need for more clarity.

According to the FTC, promotions by Buy.com, Value America and the Office Depot retail chain, had failed to disclose the true costs and important restrictions on the offers. The government body said that the companies had engaged in deceptive practices in advertising the so-called low-cost PCs.

"You shouldn't need a PhD to figure out the cost of a PC," said Jodie Bernstein, director of the Federal Trade Commission's Bureau of Consumer Protection. "These advertisers should have done a better job of disclosing the details so consumers could figure out the deal."

However, there must be a price point where it becomes appropriate for an ISP to offer free hardware in exchange for guaranteed Internet revenues. This business paradigm has worked well in the mobile phone networks and for digital television, where in exchange for a contract and monthly costs, the service company will give you the access equipment, be it a phone or a set top box.

As we move away from the unmetered access business model and people get used to the idea of paying a monthly subscription, there could still be a place for some kind of similar service from the ISPs. Whether it will be a PC or some other net appliance remains to be seen.

Personally, I'd be surprised if any PC that came bundled free with net access had enough oomph to be really interesting, especially if users had to sign a fixed term contract to get it. ®

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