How would you like a brand new iPod for $15? A laptop for $23? A $1000 check for $300? Then head on over to Swoopo.com and join one of the many different auctions where bidding starts at a penny and increments one cent per bid.
But wait -- before you head over there, read this New York Times story about Swoopo by Richard Thaler. It turns out that you have to be quite lucky to be a winning bidder at Swoopo. Thaler explains that every time you bid on an item in a penny auction at Swoopo, you get charged 60 cents. Swoopo keeps that money. So if an iPod sells for $15, that means Swoopo receives $900 (1,500 x .60) from the bidders who lost, plus $15 from the bidder who won.
Visiting the home page of Swoopo is certainly exciting, because it seems like digital cameras, video game consoles, and smart phones are being sold at ridiculously low prices, with only seconds to go before the auction closes. But those countdown timers are deceptive -- every time someone places a bid, the auction deadline is extended by 20 seconds, so auctions can drag on for days.
Swoopo is nothing more than gambling, where a bunch of losers pay the few winners' jackpots, with the house keeping most of the money for themselves. If you are looking for a bargain, Swoopo is the wrong place to visit.
Mark Frauenfelder – Editor-in-chief of MAKE magazine and the founder of the popular Boing Boing weblog, Mark was an editor at Wired from 1993-1998 and is the founding editor of Wired Online.