PC gifts -- It's the monitor, stupid

PC's are cheap (how cheap? Just a sec ...). And if you feel bad about last year's purchase, don't. You couldn't have predicted the effect the Asian economic crisis has had on PC component prices, which have fallen through the floor. How far? You can buy a 32X CD-ROM for $49. That's retail. PC makers are practically getting the things for free. Further, competition is fierce. According to ZD Marketing Intelligence, the AVERAGE selling price of a Packard Bell computer is around $700. It's so fierce that there are now plenty of places (like Gateway and Apple) that will lease you a PC for under $30 a month. It's so fierce that if you're PC shopping, you've already been besieged by rebate opportunities. This is new to PC sales -- even IBM is playing, offering $100 rebates on Aptiva models if you buy IBM's monitor.

Don't be a rebate victim
The rebate game can be misleading -- don't be a victim. For example, Compaq is offering $100 rebates on PCs, but only if you sign up with its Internet access service (you do get a free trial). Big computer retailers like Circuit City are often layering in their own rebates on top. That's how a powerful $1,159 system I looked at recently really cost $1,409 to take it out of the store -- the advertised price of $1,159 included $250 in rebates. That's computer math.

Rebates are among the oldest scams in retail, since most folks never mail them in. Know yourself -- don't consider the rebate in your decision unless you'll deal with the paperwork or you're getting an instant "in-store" rebate.

Don't take the monitor
This brings us to advertised models. Most electronics store circulars advertise PC prices less a rebate, and often less the monitor. So, I'm sorry to say, that $599 computer you went to buy will likely cost you $1,100 by the time you're done. Computer math again.

Which brings us to monitors. Surprise -- the monitor is often 30 percent of the price of your system. Yet while most people fight like heck to get the best PC deal they can, they then just take whatever monitor the vendor throws at them. Don't do that.

While PC prices are lower this year, what's more exciting is the plunge in monitor prices, and this is where you should spend your energy -- picking out a great monitor. Your wife or grandmother or teen-age son will appreciate that much more than the distinction between a Celeron 333 and a Pentium II 300.

Bigger is better
While PC prices always plummet, monitor prices have stayed relatively static since the beginning of PC time. Not any more. A year ago, you'd have paid around $700 for a 17-inch monitor. Today, the average selling price is under $400, and you can find some for $300. In monitors, size does count -- an upgrade from 15-inch to 17-inch should only cost you $100. That's worth it.

And you might consider a new class of monitors, the 19-inchers. These were just hitting shelves a year ago; used to be the next jump up from 17 was to the 21-inch size, so big it requires professional movers. Now 19-inch models, averaging a little over $600 (with some as cheap as $500), make a nice compromise. Most are cleverly designed to not take up more space than their 17-inch brethren. You'll see a lot more of that Web page on a 19-inch model.

Why fork over so much for a great monitor? "Because monitors outlive PCs at least 2-to-1," I was told. Their PC will be obsolete well before their monitor will. So two years from now, you can just give them a new box as a gift.

Now all this means you absolutely should shop for your monitor separately from your PC. Old-fashioned advice, but apparently unpopular. More and more people are buying their monitors as part of a package deal when they buy their PCs -- in fact, ZD Market Intelligence says 76 percent now do. This is often a mistake. As one PC search engine executive told me: "Never buy the monitor. That's where they make their money."

If you really must buy a package, I'd suggest ordering it online or over the phone from Gateway or Dell -- since their packages are custom built, you won't be forced into buying a cheaper "throw in" monitor that's not right for you.

How to pick a monitor
Buying a good monitor isn't hard, but there are some mistakes to be made. Here's a checklist:

See the monitor. Sounds obvious. But never walk out of the store without seeing the model you purchased. Monitor choice can be personal. You don't want your loved one to have a headache for the next two years or more.

See it at high resolution. Many monitors will boast of high resolution, like 1,280x1,024. In the store, change the resolution to the highest setting. The store might have software that stops you from doing this -- make a sales person do it for you then. Is it readable (open a text file)? Would you ever use it at that resolution? Or is it flickering, blurry and suddenly darker? If so, ignore the boasting -- compare monitors at their highest USEABLE resolution.

Viewable area. More computer math: Keep in mind that 15-inch monitors are usually about 13.3 inches (measured diagonally); 17-inch monitors are usually only about 15.3-inchers (the plastic around the glass counts in the common measurement). It's worth considering "viewable area" when comparing monitors. Thanks to a few class-action lawsuits, these are now listed in advertisements alongside monitor size.

Watch for restock fees. Some stores charge 15 percent for returned items. You might get the monitor home, look at it under different lighting conditions and hate it. Make sure you can bring it back no strings attached. If not, leave.

Technical information: If you really want to get down to it, compare monitor dot pitch ratings (get at least a .28, smaller is better) and refresh rates at specific resolutions (look for at least 75Hz, higher is better). Then make sure your computer has enough video memory to support the great monitor you're buying -- 4MB is preferable.

Don't buy the printer
Aside from "throw-in" monitors, retailers also make money by getting you to gobble up any old printer while you're excited about your PC purchase. ("C'mon, you know they'll need a printer!") There are enough complications with buying a computer -- don't confuse the matter by buying a printer you haven't had time to research.

Thanks to e-mail and the Internet, your giftee might not need the printer as much.

Or perhaps they'll get into making greeting cards and really want a laser printer. Either way, odds are that throw-in printer won't match their needs. Get it later, after you've figured out what they really need.

And while I'm on the subject, be careful about any "throw-ins." At one electronics store I visited, I listened to a salesman try to talk an older couple into buying a monitor with big attached speakers because "Some of the software will actually talk to you and tell you what to do, and you want to be able to hear it."

How cheap are they?
Whenever this topic comes up, I have two feelings. Describing computer prices is a lot like talking about the price of a company's stock -- the moment you say it, it's out of date. In fact, a Dell executive joked with me that Dell might start freshness-dating its computers.

Then there's the part of the conversation that sounds like two teen-agers talking about their hot rods in the '50s. "Oh, yeah? Well I got a Pentium 400 with 12 gigabytes and 128 DRAM for 1,200 bucks!"

Nevertheless, here are the kind of deals you can find (of course, you can do even better by buying one-of-a-kind, old models from retail outlets, if you dare.)

Yes, you can buy a PC for under $200. It's literally an empty box with a 300MHz Cyrix processor and video card inside. No hard drive, no software. I know, that's cheating. But I just wanted to prove price isn't everything. For less than $400 you can get a box with a hard drive but without Windows. Perfect if you're interested in trying Linux.

Slide up the scale a little, and there are a couple of sweet spots to look for -- $700, $1,000 and $1,300 (both with and without monitors).

Sweet spots
For $700, you should be able to get a 266-300MHz processor, about 32-64 megs of RAM, 2 megs of video memory, 2-6-gig hard drive, and all the other basics. No monitor. This is the price point established by Compaq and Packard Bell, and this computer will do just fine for folks who will browse the Net with a modem and do some word processing. If you sign up for Compaq's Internet service, you'll even get $100 in rebate, if you do the paperwork.

In the $1,000 area, you can get a faster processor (like a 333) and a bigger hard drive. At that price you can also buy a tidy package from Gateway (Last year Gateway's cheapest package was about $1,400). It includes a monitor (15-inch) and an Intel Celeron 333 processor.

For about $1,300, you jump up to 350MHz processor, 128 megs of RAM (or in some cases a 400MHz processor with 64 megs of RAM), 4 megs of video memory, an 8-12-gig hard drive and, in some cases, even a Zip drive. And at this level, you can buy a Dell package with a 333MHz Celeron processor and 128 Megs of RAM, but you must take a 15-inch monitor.

How do I tell the good deals apart?
All the cheap PCs out there are overwhelming. Do you really care if you have a 350MHz or a 333Mhz processor? Intel says you will. I say you won't notice. So what sets some deals apart?

Hard drive space -- Vendors tell me this is almost the only place left for PC makers to distinguish themselves. Hold out for 6 gigabytes instead of 4 if you can. But don't get hung up on it; does anyone really need 12 gigabytes worth of family pictures? You don't really need it unless you're saving digital videos for a good reason.

Warranty -- Some cheap PCs come with only 90 days. Not good enough. You'll find one-year warranties out there, too. But the industry standard is three years. (Dell, Compaq and Gateway all offer it on their desktops). Talk to anyone who's had a hard drive fry, and they'll tell you they wish they had a three-year warranty.

Restock fee -- Can't say this enough. You might make a mistake. Don't buy from a place that insists on charging a restock fee if you return your PC.

Reliability, service and support -- PCs do break, sometimes on their own, sometimes with your help. You will want to call for help someday at 1 a.m. when you decide to install some extra RAM. Will your vendor pass that test? Dell, IBM and Hewlett-Packard got the highest marks from ZD's reader survey this year. The annual survey results are a must read for anyone thinking about buying a PC.

What they really need
What you'll hear as advice from most sales people -- "Ask yourself, 'What do they plan to do with it?' Then buy accordingly." I'd argue that question's ridiculous; I'll bet you're doing things with your PC you never would have imagined two years ago. So I'd put it this way. Will this be their high-bandwidth PC? That is, do you expect cable modem or ADSL service in their area during the next two years, their computer's likely life? If you do, it's worth spending more to get 128 megs of RAM or more, a top-notch processor and lots of video RAM. With high bandwidth will come tons of processor-demanding applications, chiefly interactive video.

But if you aren't convinced that high bandwidth is coming, they don't need the Maserati. Hardware has way outpaced software and bandwidth. They don't need 128 megs of RAM for word processing or to deal with 50K per second worth of data coming through their modem. The hardest they'll push the machine is scanning photographs so they can e-mail your friends -- PC makers say that's this year's killer app. If they're sloppy with their hard drive, they might fill up 4 gigabytes, but then you either buy them a Zip drive or tell them to clean their room.

Meet or beat these specs
Here are my recommended minimums, based on price-points and real-life needs:

Processor: 300Mhz. Pentium IIs are preferable, but AMD's K6/2 has gotten excellent reviews. Remember, an Intel Celeron will not play games as well as a Pentium II, but that's fine if you're not an intense gamer.

RAM: 64 megs. 32 would be cutting it a little close for Windows 98 and Web browsing. It's nice to get more than that (plenty of deals boast of 96 or 128 Megs), but do you really need it to do word processing and surfing? No. Studies show performance increase is negligible for average users when they jump from 64 to 128 megs.

VRAM: 2 megs; 4 megs would be better.

Hard drive: 4 gigs. The bigger, the better. This is where you'll see the difference.

Modem: All should have 56K v.90.

USB ports: Buy an old machine without 'em, and you'll regret it.

CD-ROM: A bonus if you can get a DVD-ROM, but will you watch movies on your PC? Don't fret too much.

What about apple?
Another big change from last year -- Apple does have a place in this conversation. The iMac retails for $1,299, putting it pretty close in the sweet spots mentioned above. There have been reports that Apple plans to lower the iMac price to $999 after the first of the year, but Apple's Natalie Welch wouldn't comment on that, other than to say, "Price drops are inevitable." Apple's next lineup is the G3 series, with prices starting at $1,599.

Use the web
I'm probably preaching to the converted here, but the Internet is really your best friend when buying a PC. There are three great Web sites that partner with a host of PC vendors to sell you machines the same way travel Web sites sell you plane tickets --by hunting down the best price: Killerapp.com, Computers.com, and Computershopper.com. Try all three before you buy a PC; compare prices you see in a store to prices these virtual assistants will find for you. The big PC retailers sell online, too, of course -- Dell, Gateway and Compaq all have polished online "stores." I think you'll also find some interesting buys at PC maker online outlets, which sell refurbished, returned or outdated PCs at a discount: Like Dell and Compaq.

A gift for yourself
If you've paid attention to PC prices, you're used to the "after-Christmas" phenomenon. PC makers sell half their yearly computers in the fourth quarter; sales are usually bone-dry in the first quarter. This often means some great sales. Makers themselves say price wars are already in full swing, so don't expect drastic drops this year from them, but ... retail outlets stuck with extra inventory are likely to have some fire sales in January. So if you're in the market for a PC, you might as well wait. Prices sure as heck aren't going up.