This won't last long. Eventually people will realize they'll have more fun buying the iPod and playing craps instead.
Profitable Until Deemed Illegal
61–70 of 135 posts
Re: Profitable Until Deemed Illegal
#62I was in a game theory class and we were learning about auctions. Just don't ask me how much I paid for his $5 bill in his "all-pay" auction - it would have been evil if it didn't go to charity. ( http://en.wikipedia.org/wiki/All-pay_auction )
I've always thought this would make a great game show.
Re: Profitable Until Deemed Illegal
#63I don't see the difference between this and playing the slots in Vegas. In both cases the house has the advantage; in both cases more is paid for the final prize than what it's worth; in both cases the winner likely gets a good deal on the prize and the losers lose their investment.
There's nothing random involved in this, whereas there is with slot machines. Legally that makes a world of difference.
Re: Profitable Until Deemed Illegal
#64Earlier quoted context omitted.
He doesn't say that it is illegal, only that it's so shady that it's likely someone will make a law against it. It could fall under gambling laws, since you're basically buying chances to win the opportunity to buy something at a low price.
Oh, I don't think they'll need a new law in most jurisdictions as soon as they find out about the "Auctions for money". "Wait, so let me get this straight, people routinely 'buy' $100 for $20 on your service, and you profit $300 from the transaction from selling the 'bidding rights' to 'non-winning bidders'?" "Yes." "Oh, thanks. What determines who wins?" "Final bid price." "But paying $20 for $100, why, anybody shou…
"Ah, thank you for clearing that up. Now, in your copy of the state code, look up 'games of skill' which offer a monetary prize."
At which point they say "Don't be ridiculous. Every thrift store is a 'game of skill' with a 'monetary prize' by your standard. Have fun shutting down Aunt Ruth's House of Lamps and Doilies, pal."
Re: Profitable Until Deemed Illegal
#65I can't believe this company is offering a scenario where you pay an upfront cost to try to get something for less than it usually sells for.
I haven't seen anybody get away with that since basically every retail outlet in America charged an upfront cost -- time and inconvenience -- for the chance to buy stuff at a discount, on Black Friday. Unprecedented.
I have no idea why measuring certain things in dollars rather than hours or oranges or whatever else throws people off so. If this business freaks you out, and regular retail stores don't, you haven't been thinking hard enough about the latter.
Re: Profitable Until Deemed Illegal
#66Earlier quoted context omitted.
Wow. I need to play poker with those people.
After hearing about the outcome of this game you'd think that you'd have to be an idiot to get sucked in, but you'd be mistaken. We once did a dollar auction in an auditorium at Canada/USA Mathcamp -- not exactly a dimwitted group -- and bidding went up to $5.
Canada/USA Mathcamp: What year?
Re: Profitable Until Deemed Illegal
#67Earlier quoted context omitted.
Except you CANT guarantee yourself a win, and you certainly can't guarantee yourself a win at any price. It IS essentially random what the bidders competing with you do in response to your "last" bid.
I'm not sure how this is different from any auction at eBay, Christie's, Philips, or your local car auction.
For the purposes of this message, I define "pay" as "money out of your pocket, including the money spent 'purchasing' 'bids'."
In a real auction, if you are willing to pay twice the market price, you are almost (but not quite) guaranteed to win, and you will almost (but not quite) certainly be paying less than 2x market value. The only person who can beat you is someone willing to pay 2x+change. (When you lose, you don't have to pay anything, but that's not directly related to your point.)
In a Swoopo auction, if you are willing to pay twice the market price, you are only slightly more likely to win, rather than reasonably assured, and you can be beaten by anybody willing to put up $1+current bid, which, if you've poured twice market value into the bids, is still fairly low. (And when you lose, you still pay.)
An auction has a rational mechanism for manipulating the probability of your winning in proportion to your desire to win, as expressed by the money you're willing to pay. Swoopo's system is far, far less rational, and you can pour massive resources into an "auction" and be beaten at the end by somebody paying a mere fraction of what you are paying, even though they end up with the product.
It's a night-and-day difference. One system is rational and what most would consider mostly fair. One is crazy and what most would consider a scam.
Re: Profitable Until Deemed Illegal
#68Earlier quoted context omitted.
Its not an auction if bidding costs money regardless if you win or not. Its more of a raffle.
But you are buying the right to bid. One could argue that it's a separate service altogether, like a costco membership that's graded on how much you buy.
Have you seen their 100% Off auctions? You're buying the right to bid, to buy something for $0 regardless of the final price?
Come on, this is going to get slapped down so hard it isn't even funny.
Re: Profitable Until Deemed Illegal
#69Earlier quoted context omitted.
After hearing about the outcome of this game you'd think that you'd have to be an idiot to get sucked in, but you'd be mistaken. We once did a dollar auction in an auditorium at Canada/USA Mathcamp -- not exactly a dimwitted group -- and bidding went up to $5.
Canada/USA Mathcamp: What year?
2002 and 2003.
Re: Profitable Until Deemed Illegal
#70Wow. This is both genius, and despicable. It's amazing what kind of profit they drive, yet it seems like they're really taking advantage of people with gambling addictions, or poor money management skills.
Isn't that what most businesses do?
An annoying attitude. I spend 2 dollars on a box of crackers. Here's the rough process:
1. Farmer takes out a loan at Wells Fargo.
2. Loan clears, Farmer buys seed, etc.
3. Farmer grows 2000 acres of wheat.
4. Summer passes, farmer harvests wheat, and it travels 1000 miles to be processed.
5. Nabisco (Altria) buys wheat for a pre-agreed price (determined months ago by the Chicago futures exchange--a bunch of speculators who took risk on themselves so Nabisco and Joe Farmer could get to business.)
6. Nabisco puts the wheat (plus 10 other commodities) into its industrial mixers, ovens, packaging machines, fleet, etc, until it winds up at Walmart.
7. Walmart (which did 1001 separate things in order to make the deal go down) puts a $2.00 electronic price on the crackers.
8. I show up, put some plastic through a device, some digital numbers go through 2 thousand miles of wire to 5 different financial institutions, and then I get a box of crackers. Game over.
I've participated in 500 billion dollars worth of business without even realizing it, getting a day's worth of calories for a tiny percentage of my daily income. That's "evil" somehow?