Back in the stone age
2009-03-06 11:15
Alistair Fairweather
As an optimist I'm sometimes seduced by the idea that information technology makes us smarter. Just look at the internet - a vast repository human knowledge at our fingertips, mixed with a global communication network. Perfect information, here we come!
And then I see a site like Swoopo and we're right back in the stone age.
Swoopo - a heady combination of gambling, shopping and auctions - is a piece of moderately evil genius. You buy credits at 75 US cents and use them to bid on items. But your bids only increase the price of the item by 15 US cents. Then, whoever has the highest bid at the end pays the final price for the item.
So what's so evil about that? Well, bidding not only raises the price by 15 US cents, it also increases the length of the auction by 15 seconds. So you're sitting there, giggling at your good fortune at having bagged a new laptop for $250 that normally costs $900, and some selfish idiot named ThunderPanties333 bids 2 seconds before the end.
Are you going to let this ignoramus steal your laptop at the last minute? Hell, no! Soon the laptop is going for $306.15, and you have defeated ThunderPanties333. High five!
But let's just look at that again, in slowmo. In the 93 odd minutes of your life that you've spent scrabbling with your faceless enemy for a new gadget, you've also spent over $140 on 186 bids, and you still have to fork out the 300 odd bucks for the laptop itself.
And let's not mention the fact that Swoopo themselves have made $1 530 in total bids. Even if they do pay full retail price for the laptop (which is highly doubtful since they clearly buy in bulk), they're still up $936.15 on a single deal.
And it gets worse. Soopo also hold "penny auctions", where each bid increases the price of the final item by 1 US cent, while still costing you 75 US cents. Since lower priced items are naturally more attractive, Swoopo gets lots more bids. Sure someone gets an Apple Macbook for $27.81, but Swoopo make $800 on top of the $1 300 retail price.
Making money
There are rumours that Swoopo doesn't even buy the stuff beforehand, simply using the proceeds of their stupidity machine to feed the hungry mob that swarm all over it. They also appear to arrange for people from different time zones to bid on the same items - to keep each "auction" going as long as possible.
At least Swoopo are honest enough not to call themselves an auction site - they are an "entertainment shopping" site. In fact the whole business is much closer to a lottery or a slot machine - you pay a small fee for a small chance of winning something very valuable. Except even a lottery doesn't give you as much false hope as these guys do.
It's not the fact that Swoopo are making money by trading on greed and stupidity that depresses me, it's how easy it should be to put them out of business. With all our communication technologies we should be able to arrange a global agreement to rig the game, take turns bidding 15 cents on one item each, and walk away laughing.
But ThunderPanties333 and his buddy Gandalf777 always show up and spoil the party. And the worst thing? Given the right conditions, we are all ThunderPanties333.
What Swoopo shows us, in stark relief, is that greed still trumps intelligence - a conclusion that is eerily similar to the one drawn from the current global financial crisis. Until we can evolve past that point, no amount of technology is going to be able to save us from ourselves.
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