Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Disk Drive Sector Discussion Forum -- Ignore unavailable to you. Want to Upgrade?

To: Robert Douglas who wrote (7788)	1/13/2000 12:37:00 PM
From: Mark Oliver	Respond to of 9256

Snafu prompts Microsoft to suspend some PC rebates By Michael Kanellos Staff Writer, CNET News.com news.cnet.com. January 7, 2000, 1:25 p.m. PT Microsoft has suspended its MSN rebate programs in California and Oregon because a contract provision unintentionally allows customers in those states to wring $400 out of the software giant. Because of the way the California and Oregon contracts are written, customers effectively can cancel their MSN service contracts but still qualify for Microsoft's rebate. MSN has been offering $400 rebates to computer buyers who agreed to subscribe to the Internet service for three years through Best Buy, OfficeMax and Office Depot, among other stores. In 48 states, the contract is fairly clear. Customers have to subscribe to MSN for three years to qualify for the $400 rebate, said Tom Pilla, a Microsoft spokesman. If customers cancel the contract, penalty provisions kick in that allow Microsoft to recover part or all of the rebate. California and Oregon, however, have passed consumer protection laws that prevent companies from linking the purchase of goods to loans. Microsoft worried that its rebate program could be interpreted as a loan, Pilla said. To get around the law, Microsoft inserted the following clause--"You are not obligated to continue as an MSN Internet access member for any particular length of time"--into its contracts for California and Oregon. Subsequently, the California Department of Corporations informed Microsoft that the law didn't apply to its deal, Pilla said. Microsoft will be able to offer rebates to customers and still keep its recapture provisions, he added. Pilla said that the suspension of the rebate program was temporary, indicating that it could come back soon. The three-year/$400 rebate has been a spark plug for the PC industry this year. Consumer PC sales grew by 30 percent during the summer while MSN and CompuServe, a once moribund division of AOL, saw subscriber rates jump because of these rebates. Under these deals, consumers either get cash back through a mail-in rebate or qualify for instant in-store credit. CompuServe said it will cancel its cash rebate deal at the end of the month, although a store credit deal at Circuit City will continue into June.