An introductory offer has always come in two parts. The first is the part people remember: a free glass of soda, a dozen records for a penny, a disc promising hours online. The second is the set of terms that says what the newcomer owes once the free part runs out.
The first part has barely changed since the 1880s. The second keeps moving, from nowhere at all on a soda fountain ticket to stamp booklets, mail-order reply cards, the credit card form on a trial disc and the conditions attached to a sportsbook’s sign-up credit.
Federal rules followed the terms from one form to the next, and one written in 1973 for plans that shipped merchandise unless a member said no reopened for public comment this year.
A Free Glass Of Coca-Cola Came First
Coca-Cola is widely considered the first company to use coupons, according to History.com’s account of how Americans started clipping them. Asa Candler began giving out tickets for a free glass in 1887, while the drink was still relatively unknown, and by 1895 fountains in every state were serving it.
The tickets reached people through newspapers, the mail and street handouts, and anyone holding one could trade it for a glass at a participating soda fountain. The food site The Takeout puts the total at more than 8.5 million free-drink coupons over the next 20 years.
The ticket asked for nothing beyond a walk to the counter. That made it the simplest offer in this history and the weakest at keeping a customer, because a free glass did nothing on its own to bring anyone back. Most later offers tried to fix that, and each fix added a condition.
Green Stamps Paid Out After The Shopping Was Done
Sperry & Hutchinson tied the gift to repeat business. Traveling salesman Thomas Sperry and investor Shelley Byron Hutchinson founded S&H in 1896 to print stamps and sell them to retailers, as Smithsonian magazine recounted in its April/May 2026 issue.
Shoppers got one stamp for every 10 cents spent at a participating store, pasted the stamps into booklets and redeemed full booklets at an S&H showroom. One booklet could get a porcelain lamp. A bicycle took six.
The reward now came after a long run of purchases, and the program still grew huge. In the 1960s S&H had about 800 redemption centers and more than 100,000 participating businesses, and by 1964 it was distributing a reported 32 million catalogs a year.
The slide began in the mid-1970s. By the late 1980s fewer than 100 retailers still took part, many stores ran rewards programs of their own, and a 2000 digital relaunch as Greenpoints never won back the old following.
A Penny Bought Twelve Records And A Membership
Columbia House launched as a record club in 1955, and its pitch was nearly free rather than free. A TV spot NPR played in August promised “Any 12 records or tapes, one penny,” and CNN recalled ads for “12 CDs for 1 cent.”
The penny bought a membership along with the music. After the first shipment, members had to buy more albums at the regular club price. The club also mailed out releases nobody had ordered unless the member sent back a reply card refusing them, and bills arrived each month until a customer opted out.
That card moved the work of the offer onto the customer. Doing nothing counted as a yes, so a card forgotten on the kitchen counter could turn into an album and an invoice.
The model held up for decades. At its 1996 peak, the company said, revenue reached about $1.4 billion, before the internet and digital music services such as iTunes wore the business down. Columbia House dropped music in 2010 to concentrate on DVDs.
In 1971 The FTC Spelled Out What Free Should Mean
By the time the record club turned 16, the Federal Trade Commission had written a guide to the word itself. Its Guide Concerning Use of the Word “Free” and Similar Representations appeared in the Federal Register on November 10, 1971, and the federal code still carries it under that 1971 citation.
Someone told that one item is free with the purchase of another, the guide says, “has a right to believe” the seller will not recover the cost by marking up the required item or substituting inferior goods. Every term, condition and obligation should appear “clearly and conspicuously at the outset,” and a footnote reached through an asterisk does not count.
Introductory offers get a clause of their own. A company launching a new product may call something free only if it expects, in good faith, to end the offer after a limited time and then sell the product separately at the same price. Another clause limits how often the same product can carry a free offer in one trade area.
AOL’s Free Hours Started With A Credit Card
When Jan Brandt joined America Online in 1993, the company trailed CompuServe and Prodigy, and most American homes had no computer, let alone one with a modem. Brandt chose direct mail and put the software itself in people’s hands.
She was sure a package would get opened. In her interview with the Internet History Podcast, Brandt called it “constitutionally impossible” to get a small box in the mail and leave it shut.
The first campaign cost $250,000. Direct marketers count a 2% to 3% response as a success, and Brandt reported uptake above 10%. Those responders, in her words, were “taking the disc, putting it into the computer, signing up, and giving us a credit card.”
That card is where the terms lived. Mental Floss counted trials of 500, 750 and 1,000 free hours, and the card on file turned a trial user into a paying member once the hours ran out.
Discs turned up in Blockbuster take-one boxes, on airplane seats, in cereal boxes and in Omaha Steaks shipments, where the floppies had to survive flash freezing. Brandt has claimed that at one point 50% of the CDs produced worldwide carried an AOL logo.
Sportsbooks Adopted The Offer After 2018
The newest version followed the Supreme Court’s May 14, 2018, decision in Murphy v. NCAA, which struck down the federal law barring states from authorizing sports betting. As regulated online sportsbooks opened, they competed for new accounts with sign-up promotions.
Many of those promotions pay out in bonus bets, a currency with its own rulebook. One large sportsbook’s house rules define a bonus bet as a promotional, non-cashable bonus that can only be spent on sports wagers.
The terms turn each offer into a contract. Under those same house rules, bonus bets have no cash value and expire after 7 days unless the offer states otherwise.
A winning bonus bet’s stake is left out of the payout, each bonus bet has to be used in full on a single wager, and some carry minimum odds. Bets placed with bonus credit also do not count toward a promotion’s wagering requirements, the playthrough that only real-money wagers can satisfy.
Those conditions differ from one offer to the next, so comparing offers means reading the terms as closely as the headline, the same standard the 1971 guide set for advertisers.
LineUps gathers current offers on its Sportsbook promos page, which puts that comparison in one place.
Some of these offers were once advertised as “risk free.” On March 28, 2023, the American Gaming Association updated its Responsible Marketing Code for Sports Wagering to ban all use of that phrase in advertising. The word bonus has its own history: the 1971 guide lists it, along with gift, among terms that “tend to convey the impression” that something is free.
The 2023 update also formalized an annual review of the code, so the rules for advertising these offers are likely to keep shifting. LineUps shares its sports betting coverage on Facebook, which is one way to keep up with those changes season by season.
Prime’s Sign-Up And Exit Ended In A $2.5 Billion Settlement
Online, the club’s reply card became a checkout screen. In 2023 the FTC sued Amazon over Prime, charging that the company misled millions of consumers into enrolling and made cancellation difficult, in violation of the FTC Act and the Restore Online Shoppers’ Confidence Act.
NPR’s report on the settlement described the alleged “manipulative, coercive, or deceptive” designs behind auto-renewing Prime subscriptions and a convoluted, multi-step cancellation process. Prime cost $139 a year or $14.99 a month at the time.
The trial had just opened in Seattle when Amazon agreed on September 25, 2025, to pay $2.5 billion without admitting wrongdoing. The total paired a $1 billion civil penalty, which the FTC called the largest ever in a case involving a violation of one of its rules, with $1.5 billion for an estimated 35 million consumers.
Comments quoted in the FTC’s announcement had employees calling subscription driving “a bit of a shady world.” Amazon said the company and its executives “have always followed the law.”
The 1973 Club Rule Reopened For Comment
The FTC first adopted its Negative Option Rule in 1973, and a record club that shipped a selection unless a reply card came back was exactly the kind of plan it covered. In November 2024 the commission published a far broader version for recurring subscriptions, with streamlined cancellation and stronger disclosure duties.
Businesses and industry groups challenged it, and on July 8, 2025, the Eighth Circuit vacated the 2024 rule, finding the FTC’s failure to issue a preliminary regulatory analysis “procedurally insufficient.” The FTC restored the older text on February 12, 2026, and a month later asked whether amendments were needed “to help consumers avoid recurring payments for products and services they did not intend to order.”
| Federal Action | Date | What It Covers | Status In September 2026 |
|---|---|---|---|
| Prenotification Negative Option Rule | 1973 | Membership plans that ship a selection unless the member declines, with at least 10 days to send back the form | In force |
| Restore Online Shoppers’ Confidence Act | December 29, 2010 | Online negative options: terms before billing details, express consent, a simple way to stop charges | In force, and part of the Amazon Prime case |
| 2024 Negative Option Amendments | November 15, 2024 | Recurring subscriptions and other negative option programs | Vacated by the Eighth Circuit on July 8, 2025 |
| March 2026 Advance Notice | March 13, 2026 | Public comment on possible new amendments | Comments closed April 13, 2026 |
A proposed rule with actual text and a second comment period would come next. Lawyers at Crowell & Moring noted that the vacated version took about three years to finish, which suggests a replacement will take a while.
Columbia House Set A Final Order Date Of September 15
The record club that once counted millions of members is closing in the same year. NPR reported in August that YouTuber Channel 33 RPM had spotted a notice on the Columbia House website saying it would take no new orders after September 15, 2026, and that a call to customer service confirmed it.
CNN’s report on the shutdown found the notice had since been removed, though a customer service representative still confirmed the company was soon ceasing operations. Its parent company had filed for bankruptcy in 2015, and the current owner, Edge Line Ventures, was selling only a dozen DVD titles.
One of them was BlackBerry, the 2023 film about another product that later competitors left behind.
