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                                                                   EXHIBIT 10.16

                                Amendment No. 1
     to the Master Services and Supply Agreement Between Ford and PeoplePC

     WHEREAS Ford Motor Company ("Ford") and PeoplePC, Inc. ("PeoplePC") entered
into the Master Services and Supply Agreement effective April 4, 2000  (the
"Agreement") and Ford and PeoplePC desire to clarify and modify certain
financial terms of the Agreement; NOW, THEREFORE, Ford and PeoplePC agree to
amend the Agreement as follows:

1.   Modification of the Agreement:  The Agreement is modified as follows:

        (a)  A Section 8(a) of Exhibit A shall be superceded and replaced in its
             entirety with the following:

             "(a)   Ford's obligation to pay for each PeoplePC Solution shall
arise upon shipment thereof. PeoplePC shall invoice (or arrange for a Financing
Party to invoice) Ford daily or on the fifteenth and last day of each month, and
Ford shall send, mail or transfer (collectively, "Transfer") payment addressed
to an account at the Financing Party (as defined below), or such other account
as shall be agreed upon in writing by Ford, PeoplePC and the Financing Party.
Such Transfer shall occur as follows: (1) not later than the twenty-first day of
the month with respect to an invoice or invoices from day one through day 15 of
such month, and (2) not later than the six day of the month with respect to an
invoice or invoices from day 16 through the end of the prior month; provided,
however, Ford has a 10-business-day period to cure and notwithstanding the
foregoing, a Transfer need not be made, and the applicable due date for a
Transfer will not be, sooner than five days after Ford's receipt of an
applicable invoice. For purposes of this Agreement, a "Financing Party" shall
mean a financial institution vendor or distributor that has extended secured
credit to PeoplePC or purchased receivables from PeoplePC and shall be
identified as such in a notice delivered by PeoplePC to Ford. Once a Financing
Party has been designated under this Agreement, no additional Financing Party
may be designated without the written consent of such initial Financing Party."

        (b)  Section 8(b) of Exhibit A shall be shall be amended and modified to
             add the following language:

             "(b)   However, Ford or any Ford Affiliate will not assert any
setoff or counterclaim, or otherwise subject to netting, or fail or refuse for
any reason to pay (collectively, a "Setoff"), receivables of PeoplePC covered by
any invoice unless it shall have notified PeoplePC and each Financing Party in
writing of its intent to do so (and of the amount of the claims that it intends
to assert and the date of the invoice against which such Setoff shall be
applied) at least 14 calendar days' prior to the date of such invoice, and any
such Setoff will be invalid and void if such notice shall not have been given or
if it exceeds the amount specified in such notice or if such Setoff is against
an invoice other than the one specified in such notice. PeoplePC also agrees to
notify Financing Party immediately upon receiving such notification from Ford,
provided that this shall not affect Ford's obligation to provide such notice to
each Financing Party directly.

        (c)  Section 15.3 shall be amended and modified to add the following
phrase prior to the current text of Section 15.3:

             "Ford acknowledges and agrees that PeoplePC may assign its rights
to receive payments hereunder, whether as security or by sale, to a Financing
Party. Such Financing Party shall have the rights of a third party beneficiary
of this Section 15.3 and of Section 8 of Exhibit A of this Agreement. If a
Financing Party is or is to be collateralized by or has purchased or is to
purchase obligations owed to PeoplePC under this Agreement, this Agreement will
not be amended or modified in a manner that reduces, extends or otherwise
adversely affects such obligations or that adversely affects the position of
such Financing Party as a creditor secured thereby or a purchaser thereof
without the prior written consent of such Financing Party, which consent shall
not be unreasonably withheld."

2.  No Other Modifications. Except as provided above, the terms and conditions
    of the Agreement remain unchanged. In the event of conflict between the
    terms and conditions of the Agreement, and the terms and conditions of this
    Amendment No. 1, the terms and conditions of this Amendment No. 1 will
    control. Where applicable, the defined terms in the Agreement shall have the
    same meaning in this Amendment No. 1. This Amendment supercedes the
    Amendments No. 1 previously executed by the parties hereto.

3.  Termination of Amendment. Other than the provisions relating to the timing
    and payment of invoices, this Amendment shall terminate and be of no further
    force and effect upon the termination of, and payment in full of all
    obligations of People PC under (i) the anticipated 364 day credit facility
    between The Chase Manhattan Bank and PeoplePC (as the same may be amended,
    supplemented, extended or otherwise modified from time to
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    time, excluding any extensions beyond such 364 day period not approved by
    Ford in writing), and (ii) any credit facility by a vendor or distributor
    that PeoplePC is using in connection with the Ford Program with a term of
    not more than one year unless approved by Ford in writing.


IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to be duly
executed, effective as of this 18th day of July 2000.


PeoplePC, Inc.:                    Ford Motor Company:

By: /s/ Glen Kohl                  By: /s/ Michael Radojevic
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Name:   Glen Kohl                  Name:   Michael Radojevic
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       Senior Vice President,
       Corporate Secretary and            Ford Motor Company
Title: General Counsel             Title: Purchasing
      --------------------------         -------------------------

Date:   July 18, 2000              Date:   July 18, 2000
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