Online auction site QXL today announced it will be taking bids for 500 PCs loaded with Windows XP, at a starting price of £1.

The 1.4GHz 'Addons XP' machines are being sold by computer hardware manufacturer Bargain PCs to coincide with Microsoft's launch of the Windows XP operating system on 25 October.

"I wanted to do something a little different to tie in with the launch of XP," said Simon Coe operations manager at Bargain PC.

When asked how QXL could afford to sell PCs so cheaply Coe replied, "Of course we're hoping that the demand will be so great that we won't have to 'afford' anything."

But the ambitious scheme may ring alarm bells for those people caught up in the Smartalk debacle last year, in which the company promised to supply top-of-the-range PCs for £100. Unfortunately, Smartalk was unable to meet the huge demand for such inexpensive computers, and eventually folded leaving hundreds of customers out of pocket.

QXL's insurance against history repeating itself is the strict limitation of the number of PCs under the gavel to 500.

"We have set the auction at 500 PCs, so there won't be any risk of over-demand. I can assure all our customers that we have the resources to fulfil the auction no matter what," promised Coe.

Bidding for this sounds-too-good-to-be-true offer closes on 25 October, and QXL says all PCs will be despatched within one week of that date. And although you'll probably be paying more than £1 for a machine once the hammer goes down, we've yet to hear of a cheaper way to get Windows XP on a PC.