All 5 of your friends must sign up *AND* complete offers (and are accurately and correctly recorded, which may or may not happen correctly -- take rebates for example). Then, assuming that the entity that is orchestrating all of the referrals (a) stays in business, and (b) actually gets paid by the referring companies without them balking for lots of quickie signups and cancellations, and (c) decides to honor their commitments, then you might get your IPOD/FlatScreen/PorscheBoxter/HouseInTheHamptons.
However, lots of signups mysteriously don't get properly credited. Many emails later, they might. Also, some of the companies that pay these referral credits all of a sudden get huge influxes of signups with near immediate cancellations.... they could very well decide not to pay on the basis that they're not "bona fide" signups. Finally, the company that actually is promising you your IPOD/other item is based in some foreign country where you have ZERO chance of enforcing your rights. Basically, they send a few IPODs to a few people that actually complete the offers, and then word gets around, and they're awash in referral cash and they mysteriously vanish.
Finally, this has become such a huge phenomenon that lots and lots of "copycat" sites are springing up, so that even if one or more of the sites is "for real," but the copycats have no intention of actually doing it.
So, go ahead and give it a try, and cross your fingers. But don't expect anything.
Consider this:
A 20GB iPod costs about $294 on eCost.com, the site that freeipods is said to order from. A referral for AOL, one of the many offers that a participant can complete, can bring in about $7 to Gratis Internet. Since Gratis does not seem to be in the business of losing money, and has made no indication that they will, that means that only 1 story out of 42 can be successful in order for Gratis to just break even. And since it is doubtful that Gratis dreamed up such a risky endeavor just to break even, the chances for success are probably even less than that.
this is ugly.... Can anyone seriously report any luck with those Ipod things. I'm going to check it out! But you must have your name on every freaking mailing thing. Whats next, are they going to draft you into the army!? I tried skimming those Terms & privacy acts... 
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