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Need your PC fixed? Get ready to pay up

Demand for PC support is booming, even as retailers and PC vendors pare down standard warranties. Chart: How services stack up

Technology is a wonderful thing, when it works. Just as cars run reliably but lawn mowers never start, many people wonder why humans are capable of creating amazing technology but can't make PCs that average people can understand.

As a result, demand for PC support services is booming even as retailers and PC vendors pare down their standard warranties. Fed up with pleasant but unsatisfying support answers, PC users are increasingly willing to pay for support from those companies. Third-party PC support is becoming big business, with Best Buy aggressively promoting the services of the Geek Squad and vendors like Dell jumping to provide their own touch.

It's not completely clear how big the market is for premium consumer support, said Matt Healey, an analyst with IDC. However, the overall market for Windows support last year was $7.8 billion, which includes everything from corporate server support to consumer PCs. It's safe to say the market size for consumer support measures in the "billions," he said.

Click for chart

Geek Squad grew out of that tried and true method of PC support: the starving college student. Founder Robert Stephens, or as he prefers to be called, chief inspector, started the company in 1994 and hasn't looked back. Geek Squad now has almost 12,000 "agents," about 2,000 of whom make house calls, while the rest work in Best Buy's stores, or "precincts."

Geek Squad charges flat rates for all its services for both Windows and Macs, regardless of how long the service takes. For example, an operating system restoration costs $99, which includes erasing the "blue screen of death" and updating the PC with patches and antivirus software. The remote phone service is available 24 hours a day, and customers can also drop off systems at Best Buy stores nationwide for service.

But Geek Squad is known for its white-shirted special agents that show up at a customer's house in the GeekMobile. Customers are likewise charged flat rates for services such as setting up a wireless network, updating antivirus software, or installing new memory.

Other companies are experimenting with remote services, where the technician never has to enter the house but can diagnose many common operating system problems over a high-speed Internet connection. One such company, PlumChoice, says it can solve around 85 percent of common PC issues through its online service, said Ted Werth, founder and chief executive officer of the company. PlumChoice is the support partner for Circuit City's stores.

To use the service, a PlumChoice customer creates an account on the company's Web site, and then downloads a piece of software onto their PC that lets a PlumChoice technician take control of their computer. The program requires a key unique to each session to allow the remote technician to take control of the system. From here, the technician can walk the user through the diagnostic procedure over the phone, or just quickly find out how long it's been since the user downloaded a Windows patch, Werth said.

"The hardware has become more mature over past years. It tends to have fewer problems. People tend to have more problems around the complexity of software and virus issues," Werth said.

Because it doesn't have to travel to your house, PlumChoice can charge by 15-minute increments. The company also offers flat rates for solving certain problems, such as $99.99 for a "PC tune-up" that includes spyware removal, system tray cleanup and installation of Windows updates. And monthly subscription plans are available that include unlimited online support as well as antivirus and antispyware software.

Services such as Plumchoice and Geek Squad are thriving as PC vendors scale down their warranties. This gives the vendors and their retail partners an opportunity to lower the overall cost of a PC and sell profitable extended warranties, said Sam Bhavnani, principal analyst with Current Analysis.

Savvy customers know from their television and vacuum cleaner purchases that extended warranties are usually not worth the extra expense. But PCs are far more complicated beasts that can be rendered inoperable by a virus even if the hardware covered under those warranties works as designed.

The warranty "opportunity"
Vendors are realizing they can make money offering premium services through their own programs. Dell, which has been knocked over the past few years for its customer service, now offers extended at-home and online services through its Dell On-Call services, said Lou Mabley, senior manager for Dell On-Call services.

Dell launched Dell On-Call last November to help customers with problems such as virus removal and networking for $49 in the first 30 days with a new PC. The service can be extended beyond 30 days for an additional fee.

Dell is also experimenting with a remote service called Tech Connect, which it rolled out to its Dell On-Call technicians, Mabley said. Consumers have access to in-home support through the service, as well as under certain warranties.

Hewlett-Packard offers a metered calling card service called Smart Friend, which allows customers to call with security or networking questions, said Brent Potts, director of support planning and infrastructure. Smart Friend is similar to Dell On-Call in that it is designed to handle inquires beyond basic troubleshooting such as how to hook up peripheral devices to a PC, he said.

HP also unveiled its PC Tuneup service at the 2006 International Consumer Electronics Show along with Smart Friend. PC Tuneup involves having a technician talk the customer through a series of tasks such as antivirus updates and the clean-up of temporary Internet files.

The need for PC support services is expected to grow as consumers hook up more devices to the PC and software takes on more roles, Geek Squad's Stephens said. Even though PC vendors are working to make business PCs more manageable, complexity in the home PC means more business for services like the Geek Squad.

But for many people, local service technicians remain the most accessible means of PC support. Timothy Lugosi has been running Pasadena Computer Works for more than five years, providing support services to Southern California residents. Most of his business involves repairing the damage caused by viruses, or setting up home wireless networks, he said. He charges about $75 an hour or flat rates for certain common jobs, depending on the customer's needs.

When services such as Geek Squad started moving into Southern California, Lugosi was nervous at first. But many of his customers have been turned off by the "big box" approach that he says Geek Squad and other large vendors take to PC support, and are looking for a more personal touch.

However, those big companies have their sights locked on the premium services market, since hardware margins show no signs of expanding, IDC analyst Healey said. As the technology behind remote services improves, PC vendors are likely to find services just as important as, and far more profitable than, their main business, he said.