PC On The Not-So Cheap
- by David Matthews 2
Not too long ago, one of the things about personal computers that served as a hindrance to people buying them was the price. An average computer used to cost about $3000. "Average", of course, being a subjective term when it comes to computers, but let’s just say "average" constituted a system that was relatively recent.
$3000 is a lot of money for what some joked was a machine that was obsolete before it could even make it out of the box. Back then you could buy a halfway decent car for the price of four computers.
Eventually the price of computer components went down with more suppliers, thereby reducing the price of an "average" computer system. That, along with mail-order computer companies like Dell and Gateway, helped bring the price of the computer down from $3000 to $2000 to $1500 to $1000. Now a "basic" Internet-ready computer can cost you about $600.
But what if you could buy one even cheaper that that? Say… $200 or less?
Sure, you heard about the "free PC" offers. When those first broke, ten thousand people eagerly put their names down for one. But those "free" offers came with a price.. namely you had to give up your privacy to marketers, you had to be online for a certain period of time per month, and you lost about a quarter of your 14" screen space for ads which you couldn’t remove. Sure, it’s "free".. but is the price worth it? Not too many people thought so when they saw what it cost them.
But now to entice the families of wannabe computer users high on this notion that you "HAVE" to have a computer, computer retailers are making an offer that is proving to be hard to pass up.. a $400 rebate. You’ve probably seen them. Matter of fact, you can’t open up a shopping insert that doesn’t have that rebate offer included. It seems EVERY computer being offered has that $400 rebate on them, making the overall prices appear to be that much cheaper.
Or are they?
Reading the fine print on these rebate offers spells a completely different story.
First of all, each of the rebates offered at $400 are by online service providers such as Prodigy, CompuServe, and MSN. They don’t offer these rebates for nothing. In exchange for them paying $400 of your computer bill, you agree to sign on with them for three years at their regular membership rate of $21.95. This is non-negotiable, and you cannot cancel your membership once you purchase the computer until those three years have expired.
Now do the math… Three years, or thirty-six months, of membership at $21.95 per month comes to $790.20! You’re almost paying TWICE the price of the rebate to the online services! Not exactly a great deal when you think about it, especially if you are comfortable with your service provider and you aren't looking to get a second one.
And that’s the problem.. not too many people ARE thinking about it!
A few weeks ago I was computer shopping with my mother. She was going through the options in the store’s "build your own PC" system when the salesman made the mistake of talking about that $400 rebate.
"I don’t want the rebate," my mother said.
The salesman was incredulous. "Why?" he asked.
"Because it would actually cost her $800" I replied.
The salesman.. a young puppy who looked like he knew more about how to win at Quake II than reading the fine print of an offer.. scratched his head for a moment, trying to figure out how that could be so. So I explained it to him.
"OH!" he exclaimed as he finally got it. "That doesn’t sound like a good deal."
Gee.. you think?
Now let’s get brutally honest here.. how many people WOULD do the math and figure it out? And how many others would simply look at the money amount and figure it would be something like a coupon?
Of course, my problem is not that there are people who would be foolish enough to buy a computer with that rebate. PT Barnum and I both agree that there’s a sucker born every minute. But what my problem would be is what happens after people take up that rebate and discover they’re getting a raw deal. How many of them would chalk it up to one of life’s little lessons? How many of them would turn to Big Babysitter government and demand new legislation and regulation?
Look, I didn’t pull those rebate numbers out of thin air. The real cost of these rebates aren’t some classified secret kept locked away in the Pentagon. They’re in plain sight, written in plain English, right underneath the computer offers. You just have to look for the fine print, the same as you would with a sweepstakes offer or a bank loan. It’s tricky, but it’s neither illegal nor unethical.
Everyone loves to get something for nothing.. or at least as close to nothing as they can get.. but unless you don’t have a computer, and unless you don’t already have an online service, this $400 rebate is probably something you would best want to steer clear of.