There is a ton of nice things to bid on, so if I look at an iPad with 16GB WiFi + 3G.
The price on apple’s website is $629.00.
The high bid right now is $40.57 and climbing. Not bad to get a $630 item for a bit over $40. However, that’s really not what is being paid for this item. 4057 bids have been put in (at 1 cent/bid), which comes to $2434.
That is one hell of a markup on an item. 4x retail. But the winner doesn’t care, since they’ve paid much less than the $629. apple doesn’t care, since the item was purchased at cost (or close enough). So what’s the problem?
Isn’t this more like a raffle than a lottery? If I buy 10 bids, I’m out 6 dollars, not unlike buying a raffle ticket for an iPad. I lose, so I walk away. Basically the same thing on the website, but there are a few problems that I can see with this.
the website can easily create shill bidding accounts, to make sure that the item is never sold for less than the price that quibids.com pays for it.
Someone can get caught up in the bidding, and end up spending a significant amount of money without winning. I know that’s everyone’s tough break, but if you are actually on these websites, I can’t imagine you are very bright and are thinking things through. Plus, you get caught up in a bidding war, and see the price increasing by only a cent. if you quit, you lose that item and will kick yourself, so you stay in as long as possible.
quibids doesn’t have to maintain any inventory. Throw up any item they want, THEN they go buy it. Not a bad way to run a business, when you think about it.
I guess this seems like gambling to me. So the questions I have are:
How is this legal?
If it’s not gambling, what is the legal definition?
If it IS gambling, are these servers outside the US, and like internet poker, just work through a loophole?
just curious - has anyone used one of these sites, and if so, can you share your experience?
Oh, and the get-rich-quick folks are all over these things, which I take as a good sign they are big holes into which money vanishes, never to be seen again.
It is legal because it has not come to the attention of the authorities in a big enough way that someone thinks that they can advance their career by getting rid of this form of online gaming.
Thanks for the link. Not to be critical, but did you read the OP? **Stoid **was giving her experience on bidding (she didn’t understand how it worked… not good on a site like this!) and she was suggesting strategies to win. I’ll look through the thread, but I don’t want folks to mistake her thread for this, which, at least at the OP level, seems to be asking two different things.
Stoid was told repeatedly that there are no strategies, because it’s a scam. Did you not read this?
How is it legal? It’s not. The servers are not in the U.S. but even if they were there are thousands or millions of illegal sites and it often takes years to make a case that someone is illegal. By that time the original site may have gone out of business but 50 others have taken its place. That posts in that thread are good explanations of answers to your questions.
not initially. Based on her OP, I didn’t think the thread was asking the same questions. But it quickly does go in the direction of scam.
I don’t know Stoid, but I’m curious as to how many people out there truly think this is a good way to buy something. The link provided by **Tellyworth **is about swoopo.com, and that link leads to a few interesting articles.
The best quote from my searching is something like this: Joshua was right. “the only winning move is not to play.”
As I understand it, the element that makes them legal is, you still have to pay for it at the end.
Its like a variation on that furniture store that makes you buy a $5000 membership go get access to their great prices…Price Club or something like that.
Or you can pay $35 to join Costco and shop a limited selection of huge packages of things
I would be willing to bet you could make a working business model that is far less scammy just by bringing the bid fees down to $0.10-$0.25. Still pretty much printing money.
I am willing to bet many of these sites suffer from greedy management, see the money pour in, start assuming the money is endless, grab high dollar real estate, decorate office with picassos, jack up salaries, someone gets stupid, someone demands more, lawers engaged, everything unravels.
I guess I’m not seeing how they attract bidders. Do people think that they might get lucky and nobody else will bid? Or is it like a lottery and people think it’s like a lottery in that the odds are against them but they might make the winning bid? Or do they figure the bidding fee is a meaningless token and only think about the price they’ll pay if they win?
They attract bidders by showing past auctions/lotteries and showing how much the winning bid paid for the item. Who doesn’t want an Ipad for $27.75? If you don’t analyze how it works you might not notice for a while that you don’t seem to be winning any auctions. Eventually people will notice they don’t win any bids but the bidding fees are mounting up. So the site needs to advertise like crazy to keep the next set of uninformed people to keep things going.
Here is a linkto an interesting article about swoopo.com, which is currently undergoing some sort of financial issues.
He shows how the site works, the futility of bidding… it’s really a good read.
it’s not like a raffle at all, really. A raffle has a finite amount of tickets to be sold, with a guarantee winner. It’s not a lottery, either, since there is no guarantee of a winner in a lottery. It is a revenue generator, pure and simple.
think about the “auction” set-up. a 24 hour time limit. Think the first person has a chance to win? Nope. once the auction is discovered, and the automatic bid software begins to kick in, the only bids that have a chance are those placed within the last second of the 24 hours. And since each extra bid adds time to the auction, the auction can theoretically go on forever. It doesn’t of course, but that’s something else that can easily be controlled by software.
Winning seems to be pure luck, and not a good investment. I still can’t figure out how these sites are legal.
So if I’m understanding it, the only way to have any chance at winning is to use their automatic bidding option. Anyone using the autobid will be forced to make multiple bids by the way it’s designed but one of the autobidders will end up winning. The people who don’t do this and try to bid earlier are newbies who don’t understand how the system works because early bidders never win - it always comes down to a last second autobid.
I’m not sure I understand why they wouldn’t be legal. You are told all of this up front. There’s no deception involved. It’s not like a pyramid scheme where the creator is lying to you. I went there, and realized it was pretty unlikely to be worth it.
The reason I got there might be deception, though. I was redirected by someone on craigslist who said they’d already sold their item, but that they got it on quibids.com, and that I should try there. Seeing as the person used a hushmail address that would not accept incoming messages, I’m pretty sure they were a shill. I guess Google knew what they were doing when they called it spam.
Do they tell people up front that any bids made before the final few seconds won’t win? Or that only autobids will win? Or that you have to make multiple bids to use the autobidder?
I ran across a site like this once. Essentially it is time-based gambling, like betting on when a cow will wander onto the marked square at the county fair or what time the first runner will cross the finish line. “Bids” is a misnomer - you are staking claim to a time until the next bid comes along. Whoever has the “high bid” when the “auction” ends at some unpredictable time is the winner.
The system is totally random. The site I saw had no logic to the time element - which is how an ipod could go for $3.60; to hit the right time, you still would spend hundreds of dollars on “bid coupons” - assuming the site was in any way honest. With no element of skill, it is essentially a complete game of chance - aka gambling.
How is this different from state lotteries? Because state lotteries and casinos are legal, and supposedly regulated so the rules, odds, winners, etc are all open and above board. You cannot run your own lottery and sell tickets in the USA*; even if it is a legitimate foreign lottery you cannot sell entries in the USA. The US even attempts to block all foreign gambling websites, and has arrested executives of gambling sites if they visit the USA.
*except licensed lotteries, which have to abide by the laws and generally are only allowed to benefit registered charities.
Now I bet these sites could make a ton of money even if they’re legit - if they really sell the winner the item for the final price.
But is there anything keeping them from being a complete 100% scam that never has to actually acquire/sell any items? It seems to me that if the auction is about to end, they could just have a computer instantly generate a shill account to make one more bid. If someone outbids you again - great, you just made whatever the price of a bid is and kept the auction going - and if no one does, then the shill bidder wins the item, they don’t actually have to acquire that ipod to sell it to someone for $29.53, and the company makes all the money from the bids to that point. You could have 100% of your auctions won by your shill accounts, never actually pay out any items, and rake in the dough.
I can’t think of a way to actually ensure such sites aren’t a total scam, rather than the sort of real semi-scans they claim to be if they are indeed on the up and up.
