Commentary: Deals at the PC Thrift Store

I've never paid full price for a PC, and I'm not talking about bidding for junk on eBay. The best deals, both in price and reliability, come in refurbished--also known as "reconditioned"--PCs. These are models returned for some reason, occasionally for defect but mostly because the buyer changed his or her mind. Once returned, the seller can no longer sell the PC as new.

Most major PC makers sell refurbished computers online, including Dell, Gateway, Hewlett-Packard, IBM and Sony. Vermont-based Small Dog Electronics specializes in Apple refurbs, and PC Connection serves up a wide selection of reconditioned computers.

So maybe you're nervous about buying almost new? Don't be. Manufacturers lose money on almost every return, so they never want to see it again. One Sony refurbisher once confessed reconditioned models are looked over even more thoroughly than new ones. Once returned, refurbished and resold, the seller never wants to see that unit again.

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Refurbished PCs also can be really good deals because perception makes selling "almost new" models tougher than those coming out of pristine boxes smelling of fresh plastic. The refurbished model already is a loss leader, and the loss increases the longer the PC sits on the shelf. What's that, you ask? PC prices are already at record lows, so what difference does shopping for a refurb make? Buying refurbished means more computing bang for the buck. How would you like to save $500 on your next PC purchase?

Example: On June 28, 2002, HP listed a refurbished Pavilion 780n PC with 1.8GHz Pentium 4 processor, 512MB of RAM expandable to 2GB, 120GB hard drive, DVD recording drive, nVidia GeForce2 MX 400 graphics card, 10/100 networking and 56k modem for $1,150. The identical system sells for $1,600 new. I may have gotten a "D" in math, but even this old math dodger can tell when something costs a good 25-percent less than something else. Neither PC's price included a monitor.

Another: Dell listed a refurbished Inspiron 8200 notebook with 1.6GHz Pentium 4 processor, 15-inch display, 256MB of RAM, 30GB hard drive, 8X DVD drive, 32MB nVidia GeForce2 graphics card, integrated 10/100 networking, 56k modem and 802.11b wireless networking, Norton AntiVirus, MusicMatch 7.1, Works 2002 and Windows XP Home Edition for $1,722. The same system configured new would cost $2,136.

PC Connection's sweet refurb of the day: An IBM ThinkPad T23 notebook with 1.13GHz Pentium III processor, 14.1-inch display, 128MB of RAM expandable to 1GB, 30GB hard drive, DVD drive, 16MB of video memory, integrated 10/100 networking, 56k modem and 802.11b wireless networking and Windows XP Professional for $1,999. IBM sells a slightly newer model, virtually identical expect for double the memory and 10GB more storage, for $3,099.

Here's another one, offered the same day by Small Dog: Apple Power Mac G4 with 933MHz PowerPC G4 processor, 256MB of RAM, 60GB hard drive, DVD recording drive, 64MB nVidia GeForce 4 MX graphics card, 10/100/1000 networking, 56k modem and Mac OS X for $1,749. Apple sells the same model new for $2,299. Neither configuration included the price of a monitor.

Certainly these discounts seem too good to be true, and unquestionably not all deals are as good as these examples. Typically, the best refurb steals are like PCs with slightly older microprocessors. But other factors make big differences, too. DVD recording is still an infant technology, so companies are rolling out new models with the feature fairly quickly.

So, what's the catch?

Certainly buying refurbs is not without risk. You could easily pick up a lemon that never worked right and never will. But reputable PC manufacturers and retailers would rather have your repeat business than sell you a dud. Still, some precautions taken could ensure your refurb isn't some monster from a Mary Shelly novel. Start by finding out why the computer was returned in the first place. In the case of direct manufacturers Dell and Gateway, the PC's history is available--provided the sales person will disclose it. Don't give up until you get the information. You are the customer, after all.

You might be surprised to find some refurbs are models built to order that never left the factory. The buyer cancelled the order before shipping, forcing the manufacturer to move the computer to refurbished sales. This is more common at Dell than many people suspect, particularly when parts shortages delay shipment and sales people cancel orders of frustrated "I got to have it tomorrow" customers and take new ones in their place. Hence, Dell's huge selection of refurbished computers.

Another well-kept Dell secret is the dumping of refurbs through online auctions or computer dealers. Say what, you ask? That's right, supposedly sold-direct Dell PCs appear in unexpected places, such as catalog and online retailer PC Mall. Both online auction and dealer Dell refurbs tend to be older models or, as is the case with other PC manufacturer bidding sites, dented computers or those missing some software or other part.

Most major PC manufacturers and some retailers move overstocks, outdated items or refurbs not fit for reconditioned resale standards through online auctions. Because most reputable PC makers offer full warranty on refurbs, only those that are "as good as new" are moved through refurbished sales. Computers with dents and dings, but otherwise functional, go into the auction lot, as do seriously damaged systems.

Refurbished auctions are unquestionably buyer-beware situations. The old adage about getting what you pay for strictly applies. The deals can be sweet, but the purchase could come without warranty or means of return.

Refurbished PCs are sometimes confused with "open-box" items typically available from Circuit City, Staples and some other retailers. Open box doesn't mean refurbished. Computers sold as refurbished go through a strict reconditioning process. If returned for defect, the computer's problem is fixed before a final, thorough system check. Remember, the seller doesn't want to see this return again. Other than this process and a healthy discount, a refurb should otherwise be the same as new. Open-box items have a less illustrious history. Some are battered-and-beaten display models or returns resold the way they came back. In both cases, the open-box item is sold "as is," which could mean missing parts or software and no warranty or return policy. The amount of the discount should reflect these purchase defects.

Joe Wilcox has been covering technology since 1994 and now spends his days writing about Microsoft for CNET News.com. Joe can be found online at joewilcox.com.

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