FreePC/eMachines To Merge - Twice

FreePC/eMachines To Merge

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Low cost PC-maker eMachines and FreePC today signed a definitive agreement to merge.

Financial details of the deal were not disclosed, but FreePC shareholders will swap their stock for eMachines'. The company will retain the eMachines name and its CEO Stephen Dukker will hold the same position in the new organization. FreePC CEO Donald La Vigne will join eMachine's board of director and take the title executive vice president.

Dukker said eMachines will utilize software and technology developed by FreePC that will allow the company to maintain a relationship with its customers well after the PC purchase is completed. This "bidirectional" link will allow eMachines to send targeted marketing and advertising to consumers and supply them with value-added content.

FreePC will cease offering free computers through its web site, but will continue to support the 30,000 units the company has given away since the program went into effect last February. FreePC's business model gave consumers a free computer in exchange for their viewing a continuous stream of advertising on their computer screens.

The Internet service software will be pre-loaded onto all eMachines computers but the consumer can decide whether to participate in the bidirectional relationship, Dukker said. How the value-added content will be delivered to the end user is not finalized. It may take the form of desktop icons or something similar to a task bar with buttons that can take the consumer to specific areas on the web.

"You will not see eMachines computers boot up with ads on the screen," said Bill Gross, chairman of FreePC.

EMachines' revenue will come from deals struck with the companies that will be represented on the PC. This additional income will not immediately effect eMachines' retail pricing, but Dukker would not rule out a change in the future.

For previous TWICE Online coverage see.
Sears Stocking eMachines Starting Today, 18-May-1999
Micro Center Testing Free PC Program, 26-May-1999
Jury Is Out On Free PC, ISP Promos, 09-Jul-1999
'Legacy-Free' Development Cuts Costs, Boosts Features, 23-Aug-1999

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