It's essentially the concept of an apprenticeship as it works in the UK. The apprentice is paid a far below minimum wage salary, and is ostensibly trained by the company they apprentice with as part of their remuneration. The apprentice then works on commercial projects, again ostensibly with mentors.

Heck, throw in a ~$5/h wage and it's basically the UK apprenticeship model except with the guarantee of an actually qualified mentor. I agree that working for free is a bit of a steep ask, but I know I'd prefer to work for free with a properly qualified mentor than work at $5/h for someone totally unqualified (as my own apprenticeship turned out some years back).

EDIT: Yes, my last line is a false dichotomy. Ideally you'd be working for some sort of wage with a qualified mentor.

Facebook pays their interns over 5k/month. With how tight the market for CS graduates is, the idea of someone working for free for a company that makes a for-profit product is pretty crazy.

Unpaid (or, practically unpaid) internships are a sad reality of job markets where the supply far, far outpaces the demand - this is common in high prestige professions that do not require extensive qualifications - things like PR, fashion design, art galleries, magazine publishing, event organizing, etc.

Yes, but this is interns rather than apprentices. Interns are typically, as you've said, graduates. They're inexperienced, but they've had 3 years of theoretical training. Apprentices have had no training, much like the end user of askadev.

I agree it'd be fairly preposterous to hire a CS graduate for a very low or no wage salary. It just wouldn't be effective, what with the demand for CS at the moment.

EDIT: typo