Via CodingHorror — Penny Auctions: They’re Gambling, on “Swoopo”, a penny auction site where you need to buy credits before you can start bidding.

Because Swoopo is, at its heart, thinly veiled gambling. The companies backing Swoopo and other Penny Auction sites are hoping unsophisticated regulatory agencies will buy the “It’s not a game of chance” argument if it’s wrapped in a lot of technical intarweb mumbo-jumbo they can’t fully comprehend.

Reminds me of many unique bid auction sites that surfaced online 2 years ago, where some of them have actually been covered here on the OzBargain blog. I actually went to the Swoopo site and it does feel like gambling — and it’s addictive. I can just sit there and watch the clock counts down to 0, or bounds back to 15 second again with more bidding action.

It’s actually worse than gambling because not only you need to pay for entrance, win the auction purely by chance (and risk loosing your money not winning the auction), addictive in nature which you ended up spending more than you should because you don’t want to lose out — you still need to pay for than damn thing when you win.

But somehow it has gained a lot of popularity according to Alexa. I guess the old saying is right. Every second on Swoopo, “a fool and his money is soon parted”.