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Something is fishy about these offers of free or low-cost Personal Computers

The price of computers has come down over the last couple of years as the cost of computer chips and other components have decreased. More and more consumers are seeing advertisements for the sale of computers at extremely low prices ($199) and even for free. But there might be some strings attached.

Before rushing out and buying such computers ask yourself the following questions?

• Are you getting all the components as part of your purchase? Many offers exclude monitors, keyboards, modems, speakers and other components. Many components such as the monitor can be quite expensive.

• Does the offer require you to sign up with a particular internet service provider? If so, ask yourself:

1. What is the length of time and what is the price that you are being charged for this service? You might find that the cost of this service over the length of the contract will be more than the cost of a computer.
2. Is there a penalty to cancel? The cancellation fee might be quite high.
3. Is the service you have signed up with using outdated technology that provides a slow connection?
4. Is the telephone number to which you connect a long distance number? Your long distance bill will be quite high.

• Are there any hidden costs? Is the computer being shipped to you and is the cost of shipping and handling exorbitant? Who pays for taxes?

• Are you getting a new or reconditioned computer? Is the computer loaded with old chips or using old technology? Buying a 486 computer today would cost you close to nothing; however, it does not provide you with the capacity to install today's software applications.

• Are you getting any technical support? If something goes wrong with the computer and you can't call anyone, you might end up paying more for a computer technician to look and repair the computer than the actual cost to buy a new one.

• Does the company have a 1-800 number or do you have to pay long distance charges for support? Some companies actually charge you to pay for the use of their 1-800 number.

• Are you getting the low price or free computer offer only by completing a mail in rebate? In other words are you paying the full price of $1,500 with a mail in rebate of $1,200? Getting your rebate can sometimes take months and in some cases you might not receive the rebate. You might find that the company offering the rebate just went bankrupt in which case you will not get any money back. Some rebates require you to purchase other merchandise, which in total will cost more than it would have otherwise cost to buy a normal computer without the special discount.

• How do you get your computer repaired? Is there a local outlet or do you have to ship to the computer away for service? You might find that the cost of shipping and handling to get it back is expensive and that it takes months to get back your computer.

• Is there a warranty that comes with your computer? Are the replacement parts free but the labour extra? You might find that the actual labour costs are quite high.

• Does the computer come with any manuals? Some manuals contain valuable manufacturing information that is needed when you want to upgrade the computer.

As in the case of any other purchase, read the fine print and fully understand the offer. The so-called low price or free offer might not be so low or free after all.

Software Piracy: Cheaper Price, Expensive Cost

Thousands of jobs and billions of dollars in tax revenues is lost to software piracy every year. Most of the well-known programs are illegally copied every year and sold to many people who don't know they are buying pirated software.

In a recent study of online auction sales of software, 60% were found to be pirated. The online auction venue allows scammers to fence software to unsuspecting buyers who think that they are buying licensed software at a low price. While the cost of pirated software is less expensive than buying licensed software, the disadvantages outweigh the short-term benefits of lower price.

Why is pirated software a problem to buyers?

• Pirated software might be infected with viruses.

• Pirated software might not work.

• Pirated software will not get technical or upgrade support. This is important especially as it relates to the Y2k bug.

• Owners of pirated software will not be notified by vendors of any bugs or fixes since the software has not be licensed and the vendors have no idea that the owner of pirated software owns the software.

How can you tell that software being auctioned is pirated?

• Tremendous price differences between the recommended retail price of a product and its auction price

• Statements such as "CD-R Copy," "Backup Copy" or "Compilation CD" describe the software.

• Sellers at online auctions of such software sometimes demand only money orders or personal cheques for payment. This is also a sign that the seller may be a scammer who will fail to deliver auctioned goods after payment is made.

Keep a watchful eye when buying software online. If the price is too good to be true, it probably means that the software is pirated.