Feeds

Swoopo - eBay's (more) evil twin

How much would you bid for a bid?

Secure remote control for conventional and virtual desktops

I have never expected much out of a Silicon Valley startup with a name that sounds like a baby word, but Swoopo is a rare exception. It's an online auction site with a dastardly twist.

When you bid on products at Swoopo, you don't specify a price. You pay 75 cents for the bid, and that bid increases the price of the item by 15 cents, while extending the auction for around 20 seconds. When the clock runs out, the auction is over. By this mechanism, the winning bidder can buy, for example, a brand new Nintendo DS game system for around $30, when the item is valued at well over $100.

And Swoopo cashes in on all of the losing bidders who drop 75 cents every time they fail to win. If you don't want to spend your time giving this company your money, you can activate their automatic Bid Butler, as lightening your wallet is a task best left to machines (a fundamental law of the internet first proven by Google).

Most of the items up for bidding are real products like TVs, computers, and iPods. But to make things interesting, Swoopo has some specialty auctions, such as “FreeBids,” where bidders bid on bids. Since they're valued at 75 cents a piece, Swoopo can sell bids like real products. Even better than that, they run auctions for cash – where users spend their money trying to win a couple hundred dollars.

This is very close to gambling, but the nondeterminism comes directly from the actions of other users, not the randomness of a dice roll or a deck of cards, so while Swoopo hasn't quite crossed the line, they can see it from where they stand.

This alone doesn't amount to a hustle, it's simply a slick business plan. While there's no evidence of Swoopo doing it, if they wanted to run a scam, it would be awful easy. It's a good thing that we fine, upstanding citizens at El Reg have put our collective minds toward delivering an insightful and balanced view of the news, because if we were running the show at Swoopo, here's how we'd do it.

Since there's no verification to the rest of the community that the winning bidder actually collected the item he or she won, we would write a program that automatically up-bids the auctions, to keep the paying customers paying. Keep upbidding until the meatspace users give up and "collect" the item. We wouldn't even need inventory. If users start to get wise to the swindle, plant a few fake bloggers to talk about how they got an awesome deal on a plasma TV from Swoopo or simply dial back the bot and let a few users win the auctions.

Again, it doesn't appear as if Swoopo is doing this, but until then, happy bidding. ®

Ted Dziuba is a co-founder at Milo.com You can read his regular Reg column, Fail and You, every other Monday.

Choosing a cloud hosting partner with confidence

More from The Register

next story
Euro Parliament VOTES to BREAK UP GOOGLE. Er, OK then
It CANNA do it, captain.They DON'T have the POWER!
Download alert: Nearly ALL top 100 Android, iOS paid apps hacked
Attack of the Clones? Yeah, but much, much scarier – report
NSA SOURCE CODE LEAK: Information slurp tools to appear online
Now you can run your own intelligence agency
Post-Microsoft, post-PC programming: The portable REVOLUTION
Code jockeys: count up and grab your fabulous tablets
Twitter App Graph exposes smartphone spyware feature
You don't want everyone to compile app lists from your fondleware? BAD LUCK
Microsoft adds video offering to Office 365. Oh NOES, you'll need Adobe Flash
Lovely presentations... but not on your Flash-hating mobe
prev story

Whitepapers

Free virtual appliance for wire data analytics
The ExtraHop Discovery Edition is a free virtual appliance will help you to discover the performance of your applications across the network, web, VDI, database, and storage tiers.
Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
How to determine if cloud backup is right for your servers
Two key factors, technical feasibility and TCO economics, that backup and IT operations managers should consider when assessing cloud backup.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Business security measures using SSL
Examines the major types of threats to information security that businesses face today and the techniques for mitigating those threats.