If you intend to use a Windows Operating System, I would strongly urge you to consider only WinXP Professional. My son ignored this advice and got a machine about a year ago with WinXP - Home Edition, and I've had signficant experience fighting with the "minor differences." WinXP Pro is the "standard." The difference typically is about $200(?) if bought with a new machine.

I have numerous friends who've bought cheaper machines with "Works," and all of them have found problems with simple things they want to do and can't. Works does have a real Word now, but the "spreadsheet" is extremely limited and they don't even call it Excel. (I'm not sure it's fair to call it a spreadsheet, by modern standards.) I'd recommend getting a "real" Microsoft Office in one version or another. The difference between Office Basic and Works at one machine maker is about $99 (US) and well worth it - in my opinion. Note that there are several versions (7?) of Office, so look carefully at what you're getting, especially if you need/want anything other than Word and Excel.

If you are going to use Windows and Office, it will usually be cheaper to buy it with the machine and get it all preinstalled, even if it's an extra cost option with the machine you choose.

You can get freeware/shareware programs to do most things that the Office programs will do, and that's a viable choice, but you'll have to do your own picking and choosing. My own observation is that the ones who try to save a bit on software are the same ones most often prone to badmouth Windows and cry for "Windows help" - quite possibly because their "marginally compatible freeware" doesn't play well with others(?). Some of the alternative programs are excellent, but it's your responsibility to determine whether they're really compatible, and to solve any problems that come up. The ones who can say they've had no problems with mix-n-match software mostly are fairly advanced users, for whom it is a good deal.

Those selling "cheap" machines often cut corners on RAM and you do need to be wary of a machine with limited RAM and limited RAM expansion capabilities. Some cheaper machines are being offered with 256 MB RAM or less, and while 256 MB meets the "minimum requirement" for WinXP it won't give you particularly good performance. Consider 512 MB a minimum standard amount of RAM. Especially if you're going to do significant music and photo editing, extra RAM is needed. Good photo editing programs can use a lot of RAM, and benefit a lot from having more available than needed to just make Windows limp along. You need enough for the OS and for the programs you add.

Some machines with low RAM have only 2 slots for RAM chips and usually come with both slots filled. Cheap BIOS chips in some machines are limited in the amount of RAM memory they can access. It's much more expensive to replace existing chips and buy "bigger chips" than it is to add another chip or two of the same kind. Four 256 MB chips will usually be cheaper than two 512 MB chips, a machine with 4 chip slots is somewhat to be preferred, and I wouldn't suggest buying a machine now that won't allow you, at least theoretically, to install at least 2 GB of RAM. You're unlikely to need/want more than 1 GB, and may actually get by with 256 MB, before you've worn out this new machine, but a low limit on maximum installable RAM is a "symptom" of a cheap BIOS and Chip Set that can cause problems in other areas.

It is NOT ALWAYS TRUE that you can "always add more later," since the BIOS and CHIPSET may set a limit that can't be (easily) exceeded in some machines.

Bargain priced computers also often cut corners on Hard Drive sizes. Some "business lines" are available with 40 GB hard drives. This is barely sufficient for installing the OS, and is appropriate only where the machine is a client on a network where all the "productivity" programs and all the work output are stored on a server. It is NOT suitable for a home user unless it's for "granny in the care home," - and even granny might take an upgrade out of your share in the will.

Especially if you are intending to work with music files and/or photo editing of any kind, I would suggest something around 120 GB as an minimum for a primary hard drive. I personally would not opt for a very large HD (>180 GB?) as the only drive, due to reliability and backup considerations. I find it much more useful to have a pair of 160 GB externals for overflow, and those can easily be added later. You probably could get by with an 80 GB HD in a new machine if you anticipate adding an external HD fairly soon and make allowance for the addition.

Several makers offering the "Client" machines with small HD and limited Optical Drive (CD and DVD) options are also omitting any modem, so if you use dial-up at all, you will want to check that one is included. ($29?)

A good machine with reasonable expansion capabilities, pre-loaded with WinXP Pro and Office Basic, with 256 MB RAM installed and capable of 2 GB expansion, with a CD-R/W, and with 120 GB HD is more reasonably at about $1,200 (US) than at your $700 target. You likely can find bargains that meet your needs at something closer to your goal, but it will require you to do some careful "spec reading" to avoid later woes.

Consider the choices you made when you bought your present 5-year old machine, that now make it "not upgradeable"(?). Make choices now that will get you a machine that will offer some hope of lasting 7 to 10 years next time(?). By then, the "new Windows" (originally scheduled for 2002 release?) may be out and we'll all need *new machines.

* Almost any reasonably equipped machine you buy now may be able to run the "new Windows" should you eventually want to, but many really cheap ones probably won't. Quite a few 5-year old machines, and some much newer ones, are marginal for it according to beta reports.

John