Thursday, May 22, 2008

Telebid Telegambling

I stumbled over Telebid last week.

From a technical point of view, it is a very dynamic web page. You see countdowns and other information flashing over the screen, which creates the tension and excitement of a computer game. A nice piece of Web 2.0 / AJAX technology.


From an economic point of view, all of this visual stress is created to lure you into bidding for a seemingly cheap product. I wanted to give you a calculation, but then a quick Google search gave me Oliver's article, who came to the same conclusions as I did and who wrote it up nicely with good model calculations.

It is indeed an AJAX game for money.

Update:
They changed their name to Swoopo.

1 comment:

John said...

I agree about the Gambling and Not auction point.

This is clearly not an auction site and to actually win an item you have to be prepared to spend some money with the risk of losing everything.

I have watched the workings of this site for some time and have noticed that the so called BidButler system wins 9 times out of 10 which forces me to question why people still use Single bids against a BidButler as again 99% of the time you will just end up wasting the single bid.

Personally i'm suprised how far and how much people will spend to get a "bargain".

Example:

Telebid offers FreeBid vouchers in their "Auction" in increments of 50, 150 and 300 FreeBids.

I watched an "Auction" for 300 FreeBids and when it ended, suprise suprise. The person who used the BidButler won.

Now thats fine except for the fact that a 300 Bid voucher normally retails at £150 and the person who won this "Auction" paid over £200 in Bids.

Now to work this out we have to see how much the Voucher went for. £189 was the finishing bid i think.

£189 / 7 (price the item increases each time a bid is placed) = 2700 Bids placed.

2700 bids at 50p a bid = £1350 from all the people who bid in this "Auction".

So thats £1200 profit to Telebid for "Auctioning" an item instead of just selling it for the normal price.

£200 of bids from the winner is 400 bids so the other hard to comprehend thing from this is why would a person bid for 300 FreeBids with 400 of their Paid Bids because at the end of the day they have lost £50 (100bids).

Now i dont really know if there are "insiders" working for telebid, just bidding to keep the single bidders bidding which of course is illegal but what i do know is that if your looking for a bargain then Telebid is definately not the site for that.

However if you have money to burn and are a compulsive gambler then telebid is a great way to lose a LOT of money very quickly with nothing to show for it.

I hope this review helps.