Smokoo may become illegal gambling says DTI

brevity

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Jan 12, 2007
Messages
253
It is not a scam... it does not need to be.

Simply:
1. Each bid costs R5
2. The bid price goes up by R0.05 for each bid
3. So, if the final bid price is R20.00, then smokoo made R2000.

Let's say the item listed has a market price of R1000. I see many of the final auction prices R18 - R22. So who wins?

1. The guys who starts bidding around that time and is willing to risk about R500.
2. Smokoo.

Remember, Smokoo may also buy the item for about R600. So profits for about 70% of the items is +100%. There are some items where they lose money, but there are also some items where they are making +400%.

This shows that there aren't any bots. They don't need to be any with that type of "mark-up". It's the same with online poker. The sites make so much money there is no need to scam the user.

All the rules are explained. They are not hiding anything.

The main issue is that for many people - seeing the 'current winning bid' price of R20.00 - it makes sense to just try there luck - I mean, it's only R5. And down the hole they go.

So, all this means it is gambling (or a close approximation to it - at least in the way it triggers our desires to get involved [e.g. easy money]... So as some other commentators say, they just need to be audited, and certain percentages of their income should go to NGOs and so forth, which is what the profits from the Lotto are meant to go to. The government is only willing to condone gambling if part of the profits go to improving society... that way you have your freedom to do whatever you want, but we must accept that gambling is addictive and so - if people are going to become addicted and say "end up living in a hole" - some of their gambling money will actually be there at the bottom of the hole to help them.
 

Arsenal

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Feb 15, 2011
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Hi all,

Just thought i would ask a question. I dont personally have anything against penny auctions as I think most of them are transparent on how they make their money (if you can do maths, if not blame the goverment or your parents). I dont agree on penny auction sites using bots and if they do they must definitely be shut down.

My question is that if these laws are implemeted will companies like Smokoo and Bidchaser be found guilty of something and be giving a fine. Or is it just the fact that they should close down if this law is implemented and nothing will happening to them. Dont know who can answer this but would really like to know.

Just a quick thing if I compare penny auctions to competitions. When a sms competition is run by a radio station and they offer a holiday worth R5000. They say that you can enter as much time as you like. Many people will enter alot of times spending alot of money on sms (this happen to my friend) and at the end there is only one winner. The radio station ask R2 per sms and ends up making R20000 on the whole competition. Lots of people lost money and there is only one winner. Now my question to you is why isnt this illegal. This should as people are losing money and going home with nothing.

Just a question.
 

brevity

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Jan 12, 2007
Messages
253
You are only allowed to run a competition if the purpose is not to make a profit, e.g. marketing, raising funds to build a community centre etc.

Also, they ask you a question (regardless of how easy it is) which makes it a competition (you need some brain power) unlike gambling which is just luck.

I also had an idea for a making buckets of money with an online type system (auction/voting) system but when I asked a lawyer to read up on this, they said afterwards that the constitutional law regarding this says my idea and ideas like Smokoo are illegal... so I never went ahead with it. Too bad, I should have run with it and waited for the lawyers to arrive.
 

Jakes147

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Apr 30, 2010
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It's alot of work to run and all the directors of the site including myself don't have much time on our hands so we are evaluating and a decision with the site will be made soon.

so what you're REALLY TRYING TO SAY ISS.....................We want to sit around and see if it won't land us up in jail? Good call
 

milomak

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May 23, 2007
Messages
12,571
If you read my post you will see I'm not mentioning anything about it not being an auction. Only regarding it being gambling. The DTI says it's gambling, but NGB already investigated and said it's not. What's up with the DTI doing that?

Regarding your reference:
If the regulation regarding auctioning passes, then surely the sites will just adopt with penny-'auction-like' bidding and then say it isn't auctioning - thereby bypassing legal constraints. Because if everybody rants that it isn't auctioning, won't it then actually count in their favour when it comes to regulation enforcement?


did you notice that the DTI is talking about draft regulations. regulations to be implemeneted in the future. any investigation would happen under current regulations.
 

Skulz

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Jun 19, 2006
Messages
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so what you're REALLY TRYING TO SAY ISS.....................We want to sit around and see if it won't land us up in jail? Good call

Your assumptions are idiotic...

That is not the plan at all.

We've gone through the legalities - if it was a bad idea and would cause conflicts later on then we wouldnt of gone with the idea _obviously_
 

Arsenal

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Feb 15, 2011
Messages
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No way are competitions run if they do not make a profit. Does that mean that the people who sms and enter just dont get charged. Nope they get charged. I know this cause I saw this at my last job.

I hate losing money but if penny auctions are illegal then I dont know what else is going to becom illegal. I believe if you are not stupid you will not lose alot of money. I think that smokoo can be approved to give members a better experience but at the moment they are work in progress. Snokoo needs to hear what the members want.

I played on penny auctions and never won. Its was fun and a thrill but I stopped at like R100. I was CLEVER and not STUPID.
 

drukkie

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Jan 24, 2007
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reminds me of the phrase "Winners know when to stop"

Duh...they've won! you don't win 5mil and say to yourself....mmm lemme just try a few more....

LOLOL
 

william riker

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Messages
770
No way are competitions run if they do not make a profit. Does that mean that the people who sms and enter just dont get charged. Nope they get charged. I know this cause I saw this at my last job.

I hate losing money but if penny auctions are illegal then I dont know what else is going to becom illegal. I believe if you are not stupid you will not lose alot of money. I think that smokoo can be approved to give members a better experience but at the moment they are work in progress. Snokoo needs to hear what the members want.

I played on penny auctions and never won. Its was fun and a thrill but I stopped at like R100. I was CLEVER and not STUPID.

i also played around with a few hundred and was amazed at how quickly its all gone.
the only thing i had an issue with are the bid credits at R5..

at the moment there are bids on an ipod and so far its at R142...
thats R5 per 5c bid..

so users have spent 142/0.05 = 2840 bids * R5 = R14200 !

on an ipod worth R3999, thats R10200 profit for smokoo!

the bidding is still going on...
 

roligov

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Dec 11, 2007
Messages
438
What stops them from running bots? are they being audited?

Nothing stops them, and not they not being audited. The first month of opening I asked when will they be audited, they said a few weeks, I told them to drop me an email once they audited and legit. It's been many many months and still no audit...Wonder why that is :whistling:
 

Kosmik

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Sep 21, 2007
Messages
23,264
reminds me of the phrase "Winners know when to stop"

Duh...they've won! you don't win 5mil and say to yourself....mmm lemme just try a few more....

LOLOL

You would be surprised.
 

MiY4Gi

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Dec 4, 2010
Messages
1,105
I don't get why Smokoo isn't illegal already. Why has it taken so long for penny auction sites to be classified as gambling sites? You PAY for a CHANCE to win therefore it IS gambling! Plain and simple.
 

Jakes147

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Your assumptions are idiotic...

That is not the plan at all.

We've gone through the legalities - if it was a bad idea and would cause conflicts later on then we wouldnt of gone with the idea _obviously_

Ouch a bit touchy arent you. Sean you sound like a crook out for easy money. None of the sites provide independant proof that they dont manipulate the auctions. Until they do it will always be scam in my eyes. People will cheat for personel gain if not checked on.
 
Last edited:

Skulz

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Jun 19, 2006
Messages
26
Ouch a bit touchy arent you. Sean you sound like a crook out for easy money. None of the sites provide independant proof that they dont manipulate the auctions. Until they do it will always be scam in my eyes. People will cheat for personel gain if not checked on.

That's your opinion - I know how I ran my site, don't give me a bad name on a public forum when you know nothing about me.
 
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