The online giant is offering 700 hours of free Internet access, but the fine print explains that the offer is only good for the first month. That means new members would have to stay online almost 24 hours a day to take full advantage of the promotion.
"As if anyone wanted to give up sleep for what is in effect a $19 value," said Rick Bruner, vice president of interactive marketing research at IMT Strategies.
An AOL representative said the promotion is good for families, as it allows for seven screen names.
But only one screen name can be connected to the service at a time. And families new to the Internet are less likely to be "power surfers," motivated by all the hours they can surf for free, Bruner said.
Bullish marketing tactics like this are becoming widespread as companies struggle to attract new customers and beef up revenues. Analysts had doubts last week about a marketing ploy involving online photo upstart Shutterfly.
The company,by Netscape Communications co-founder Jim Clark, offered consumers 50 free photos for one month with the purchase of a digital camera from Toshiba. But Shutterfly already gives a month of free photos to any new customer who signs up for its service.
These ploys are not so different from ones offered by cellular phone carriers or other Internet service providers, analysts say.
"If you read the fine print from cell phone carriers offering 500 minutes free, it's not such a good deal," said Marissa Gluck, an analyst at Jupiter Communications. "You usually only end up with about five minutes of prime-time use free."
Many Internet businesses are using giveaways as a way to differentiate themselves in this cutthroat market. Marketing executives push free goods and services as the best way to draw consumers online, according to a recent report from Forrester Research. Online promotions are booming as a result, and Forrester estimates that spending will triple to $14 billion by 2005.
"Just about everybody is looking at different gimmicks to drive people to the Internet. The Internet is the great giveaway, and people are not willing to shop online unless they get something free or with added value," Gluck said.
"It's the Gap syndrome: People aren't going to buy that sweater because they know it will go on sale in two weeks," she said.
Dulles, Va.-based AOL may alienate some of its new recruits if they have not read the promotion closely, analysts say.
One Web surfer said the company's previous "500 hours free" promotion was bad enough.
"That would mean you would have to be online over 16 hours a day and get 7.9 hours of sleep in a 31-day month. That was insulting enough," he said.
"I am amazed that they can make such an offer and even more amazed at the people who are lured by it," he said.