Wired News - 23 September 2004 (bolding mine)
In the last several weeks, FreeiPods.com has become more associated with spam and delays than free iPods, but the company claims it is sending out more music players than ever.
In August, Wired News reported that FreeiPods.com is a new marketing scheme that rewards subscribers to various online offers with a free MP3 player.
FreeiPods.com is one of several "customer acquisition" websites run by Gratis Internet of Washington, D.C. To get a free iPod, subscribers must sign up for various online promotions and persuade five other people to join up as well.
Subscribers are given a choice of about 10 different offers, including trials of The New York Times, America Online or Boca Java's coffee club. The offers are typically free and easily canceled, the site claims.
Once the trials are over -- for both the main subscriber and their referrals -- the free iPod is dispatched.
However, Wired News has been inundated with complaints about spam, mishandled accounts and shipping delays.
Earlier this month, Jim Youll, a 39-year-old CTO from Cambridge, Massachusetts, signed up with a virgin e-mail address and within hours started receiving spam.
"This is not an encouraging trend," he said, "and these are not targeted ads. They are garden-variety junk spams."
Aaron Shier, a 19-year-old student from Hamilton, New York, sent numerous unanswered queries to the company while waiting nearly 40 days to receive his iPod. When he did get it, it was from Hewlett-Packard, not the Apple Computer one he ordered.
"I am still getting spammed and so are the people who signed up for me," he said. "They stay true to their word that they will get you out a product, but their customer service is miserable."
"The terms and conditions are absolutely incredible," said Richard Strauss, who investigated the site before signing up. Strauss said the contract allows Gratis to substitute products, ignore complaints and change the number of required referrals.
"In other words, they can pretty much do, or not do, anything they feel like doing," he said. "Pretty amazing."
There are several records of complaints against Gratis Internet and its affiliate websites with the Better Business Bureau of Washington, D.C., but they are all listed as resolved.
A spokeswoman said the bureau has received about 30 complaints about the company, but was unable to elaborate. She said to her knowledge, all the complaints had been addressed.
As well as FreeiPods.com, Gratis Internet is also behind FreeCondoms.com, FreeDVDs.com and FreeFlatScreens.com. The company recently launched FreeDesktopPC.com and is planning to introduce a couple of similar sites in the next few days.
Gratis is run by co-founders Peter Martin and Rob Jewell. In a joint interview, the pair admitted there have been problems, but said they are victims of their own success -- they're swamped.
"Things have been going really well," said Martin. "We're continuing to grow and we're shipping out more and more iPods.... We're trying to play catchup with all this success."
Martin and Jewell said between 100,000 and 150,000 people have signed up for FreeiPods.com since August. To date, they have dispatched more than 4,000 free iPods, and another 1,000 are pending, they said.
Martin and Jewell admitted there have been shipping delays, but said they were caused by Apple's problems manufacturing enough iPods to satisfy demand.
"The wait is 100 percent due to Apple's manufacturing," said Martin. "Apple is on back order. The delay is three weeks plus. They sit in the queue and when it gets to the vendor, it goes out the door."
Martin said subscribers are advised to switch to Hewlett-Packard's iPod instead, since they are in better supply.
"If it was up to us, we'd ship them out tomorrow," said Jewell. "We want to get these iPods in users' hands. It hurts us to get them out slow."
As for spamming, the pair claimed users are not spammed, but do receive a small number of messages from select parties.
"We do withhold the right to send some marketing messages to our users," said Jewell. "It's not high volume and it's not a big source of revenue for us.... It's something we're upfront and clear about. We warn our users they may get some messages from our marketing partners."
The warning, Jewell said, is in the site's 900-word terms and conditions.
Martin and Jewell claimed the content and volume of the messages are within Truste's privacy guidelines. FreeiPods.com is certified by Truste and supposedly adheres to the organization's privacy standards.
Martin and Jewell denied e-mail addresses are sold to third parties, and said there's a clear unsubscribe mechanism for opting out of their marketing list. (Wired News received complaints that the unsubscribe mechanism doesn't work.)
After the interview, Martin and Jewell said they will discontinue sending marketing e-mails.
"We are suspending all marketing via email to our customers, and wanted to make sure you knew this was an important and sensitive issue for us," Martin wrote in an e-mail. "Sending promotions to users is a fairly standard practice for many industries, as an additional source of revenue, but we definitely want to continue to spread a positive and trustworthy image of our company down the road."
Martin and Jewell said they've had their own share of problems with users trying to cheat the system or complaining unfairly when they have failed to fulfill the offers' requirements.
Not everyone is unhappy with FreeiPods.com. Wired News got several notes from readers saying they'd earned and received a free iPod or flat-screen monitor.
And George Wedding of Elk Grove, California, said although he failed to find enough referrals to qualify for an iPod, he was happy nonetheless with his free trial of Blockbuster's on-demand movies.
"So far, no friends have signed up, and all have expressed that it sounds too much like a pyramid scheme," he said. "At least we are very happy with the Blockbuster service."
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