Sunday, July 25, 2010

Newsmax Free Radio -- What Are They Selling?

Newsmax free radio ad from Parade magazine
Here's what this ad from today's Parade magazine was offering:

  • An emergency radio (AM/FM and shortwave, with a hand-crank generator in case the batteries fail and an emergency flashlight built in)
  • Four issues of Newsmax magazine
  • Six issues of the Franklin Prosperity Report
All for free, except a $5.95 charge to cover shipping and handling for the radio.

I read the text several times, and $5.95 really does appear to be the only charge. So I went to the web address provided to make sure that was really what it meant.

Yes, that is what it meant, but the web page did make the details much clearer in the smallish print: After the first four issues of Newsmax or the first six issues of Franklin Prosperity Report, your "subscription" will be automatically extended for a full year at a cost of $39.95 for Newsmax and $49.00 for Franklin, about $90 a year.

So by sending in your $5.95, you are officially subscribing to two publications. From what I can tell, each is a monthly. At a cost of $3.33 and $4.08 per issue, that's a fairly typical magazine price these days, if you actually meant to subscribe to it and want to read it.

If you wanted only the free issues, though, you would have to be sure to cancel your subscription before it's extended.

This type of free trial subscription is not uncommon in the magazine publishing world. And it's well-known that most people won't remember to cancel the subscription in time, and will end up paying for at least a partial subscription. Just like people who finance a new refrigerator with "no payments until January 1," then forget to pay the new appliance off before the date and get socked with back interest and a higher rate. There's a reason why businesses make offers like this (as far as I'm concerned, they should all be filed under "free lunch, no such thing as a").

Newsmax's terms of service state that subscriptions will be automatically renewed unless canceled -- I assume this means all subscriptions, not just the trial subs. (Which seems a bit counter to the language in the smallish print on the signup form, which said, "I'll always receive advance notice of annual renewals, and I can cancel at any time for a full refund of the unused portion of my subscription.")

Perhaps more objectionable than the offer itself is the way the emergency radio is presented. In the Parade ad, the free offer is bracketed by two other pieces of copy:
  • A red bar with white letters reading URGENT MESSAGE
  • A sentence in bold type that says, "The U.S. Department of Homeland Security advises that every American home have an emergency radio."
So that's a bit alarmist and maybe even manipulative. But the web page is much worse:

Screen snapshot of Newsmax free radio offer on July 25, 2010

OH MY GOD -- I'd better get a radio right now!

But if I really need one, maybe I should just buy one for under $30.00 and forget the extra subscriptions that'll likely end up costing me more in the long run.


Blissed-Out Grandma said...

Not only do you get their magazines, but they get your contact information so they can sell you more stuff to keep yourself safe.

Daughter Number Three said...

Good point -- it does sound as though there are lots of other financial advice publications and products where these first ones came from.