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View Poll Results: Would you like to see penny auction ads disappear from Macrumors?
You betcha! Penny auction ads have no business here. 58 44.96%
Meh. I don't care one way or the other. 34 26.36%
Keep 'em. If MR pulled every ad that somebody didn't like ... 37 28.68%
Voters: 129. You may not vote on this poll

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Old Nov 9, 2011, 08:03 PM   #101
FloatingBones
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Old Nov 10, 2011, 09:09 AM   #102
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Originally Posted by FloatingBones View Post
WTF does "overstock" mean? Is dealfun.com saying they are somehow overstocked on iPads, iPhones, and iPod Touch devices? How would that happen?
They are lying. "Overstock" means someone built too many and has to try to get rid of them at a cheap price. Hasn't happened to Apple for ages. And when Apple has leftover devices after introducing something new, the old devices get sold as "refurbished" by Apple itself. (Just recently Apple sold a lot of refurbished iPad 1's at very good prices; I would have bought one if I didn't have one already).

They are also lying when they talk about "buying" and about "auctioning". The essence of "buying" is that a merchant offers goods for some price, and if I want it I pay that price and get the goods, and if I don't want it, I pay nothing and get nothing. The essence of "auctioning" is that the merchant offers the goods but not at a fixed price, anybody can bid, and the highest bidder pays the bid price and gets the good, while everybody else pays nothing and gets nothing.

Notice the combination "gets nothing and pays nothing". All these penny auction sites make their living from people who pay good money to bid and end up paying lots of money and getting _nothing_.
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Old Dec 19, 2011, 10:58 AM   #103
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They're baaaaack!



Consumer reports finally weighed in on penny auctions with this article.

Quibids has contended that their "buy now" program means they are not a ripoff. They published a report from an independent auditor which found that they do indeed fulfill on auctions from winning bidders and users of their "buy now" program. That program allows losing bidders on an auction to purchase the item and to lower their purchase price by the amount of [paid] bids the bidder placed on that item. Unfortunately, the "buy now" prices are typically inflated -- much higher than the amazon.com price for an item. Also, I've never seen any of the penny auction sites that do "buy now" actually list the "buy now" price for items up front. I believe the program is a facade: I would guess that far less than 1/100 of 1% of bidders know that "buy now" even exists.
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Old Dec 19, 2011, 02:57 PM   #104
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Originally Posted by FloatingBones View Post
Consumer reports finally weighed in on penny auctions with this article.
Good read!

I was amused by the penny auction industry's excuse-making:
The [penny auction] websites reject the gambling label. The main reason, they argue, is that there's no element of chance, as there would be when you play a state lottery, for example. They also say that you control how often you bid and when to stop.
Of course there's an element of chance. QuiBids' own site says "you win by being the last to bid" and you don't know who else is bidding or even when the bidding will end.

By their definition playing slot machines isn't gambling because you are allowed to stop whenever you want!
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Old Dec 21, 2011, 07:04 PM   #105
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Still serving up ads today:




Quote:
Originally Posted by Doctor Q View Post
Good read!

I was amused by the penny auction industry's excuse-making:
The [penny auction] websites reject the gambling label. The main reason, they argue, is that there's no element of chance, as there would be when you play a state lottery, for example. They also say that you control how often you bid and when to stop.
Of course there's an element of chance. QuiBids' own site says "you win by being the last to bid" and you don't know who else is bidding or even when the bidding will end.

By their definition playing slot machines isn't gambling because you are allowed to stop whenever you want!
Agreed. Heaven forbid if there were two bidders in an auction who wished to have "no element of chance": they would continue to bid up the auction forever.

These are gambling sites. They only continue as long as the sites attract fresh rubes participants.

Last edited by FloatingBones; Dec 21, 2011 at 07:12 PM.
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Old Dec 21, 2011, 07:12 PM   #106
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I agree that penny auctions are simply scams, but honestly guys, just install AdBlock if it bothers you that much. No one's forcing you to click the ads and the sites themselves tell you exactly how they operate, so it's not like you're being tricked into anything.

Opening one of those sites is a very nice way to make profit, though, I must say. The iPad that went for $51.54 in the previous picture would have probably made the site $5,154 revenue!
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Old Dec 21, 2011, 09:07 PM   #107
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Originally Posted by 0dev View Post
I agree that penny auctions are simply scams, but honestly guys, just install AdBlock if it bothers you that much. No one's forcing you to click the ads and the sites themselves tell you exactly how they operate, so it's not like you're being tricked into anything.
Ad-blocking software in general has already been discussed in this thread. I do not mind viewing ads here for a couple of reasons:
  • Pertinent hi-quality context-sensitive ads are actually educational.
  • Advertisements are the primary source of revenue for the site. Users that don't contribute to the site who block their ads are a drain on the site.
I do block Flash advertisements, but I don't block regular HTML ads here.

Quote:
Opening one of those sites is a very nice way to make profit, though, I must say. The iPad that went for $51.54 in the previous picture would have probably made the site $5,154 revenue!
It's not quite that simple:
  • Most of the sites charge $0.60 per bid.
  • Many sites have other ways to buy bids. As kooky as it sounds, many sites conduct auctions that sell 50 or 100 bids. Some sites have auctions where 10 or 20 bids are packaged with items (like small-ticket gift cards).
  • Most auctions on a site are for small-ticket items, and many of those auctions may well lose money for the auction site.
  • If you watch on pennyauctionwatch.com, you'll see that there is fairly rapid churn of these companies. It's expensive to make these sites, and they have pretty high overhead to get new customers. I'm guessing there's a very high churn on customers.
Penny auction sites are a great example of bamboozling: creation of a complex mechanism that serves no purpose but to deceive. Or maybe I'm wrong: perhaps there is a group of people that are "entertained" by bidding -- then losing -- on penny auctions.
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