The Australian Competition and Consumer Commission (ACCC) has added its concern to IT industry analysts over the proliferation of "free PC" deals.
The ACCC's anxiety stems from deals that generally offer a PC for a small up-front cost, or no cost at all, with the consumer then paying a monthly fee that includes an Internet access fee, repayment for the PC and a credit charge.
Acting ACCC chairman, Allan Asher, does not contend the concept of the free PC, in fact he welcomes the competition it encourages. However, Asher has witnessed "competition distorted by misleading or deceptive conduct" and worries that consumers will pay more in the long run through such deals.
"The ACCC is concerned that some of the deals are so complex that the headline price is meaningless. There is a risk that consumers will be misled if important conditions and the real price are only revealed in the fine print or flashed onto the TV screen for a few seconds," explains Asher.
Asher also warns that deals that force consumers into long-term contracts are detrimental to the end user in an industry renowned for its dramatic transformations. "Three years ago the June 96 edition of Choice showed the Internet access price for 30 hours per month was almost $100. Now $30 for virtually unlimited access is commonplace. In 1996 a state of the art PC had a 200MHz Pentium chip and cost more than $4000. Today you can buy twice that power for half that price," said Asher.
To counter such charges those in the industry utilising the new free PC marketing model must clarify several issues and be ready to face a barrage of questions from sceptical consumers. "Consumers should at least find out how much it costs to end the agreement early," stresses Asher. He also suggests that buyers should ask how the price of the package compares to the total price for the separate goods.