I was getting all set to tear into the ridiculousness of ‘fantasy sports’ site PicksPal (recently reviewed in TechCrunch) ‘expert’ strategy, but the commenters on that post have already done it for me. Just go read Nassim Taleb’s Fooled By Randomness. So no more on how PicksPal looks like nothing more than the sports version of an investment newsletter scam. Instead, I’ll point readers to Sean Park‘s quality rant against US government hypocrisy and remind everyone that your government is paid for. Online ‘sports markets’ aren’t legal in America in part because the political action committees of the already-legal gambling industry contribute heavily to Congressional and Senate campaigns, and in part because the government hasn’t figured out to tax it yet. Valleywag today makes the same point about ‘net neutrality’ – also a no-flyer, because the telcos are major campaign contributors. And even the Department of Justice isn’t going to get the National Association of Realtors to stop their non-competitive practices – not when their PAC’s pockets are this deep.
This is the natural result of a political system that’s turned elections into months-long bullshit contests run by cash-burning professional marketers. If you don’t take the money, you’re not going to get elected – and the money flows only to candidates supporting the right issues. This isn’t a Republican vs. Democrat problem – I’m critiquing the system, not the current government – and this isn’t a corruption problem, since political action committees aren’t paying for votes, they’re supporting candidates and sitting politicians who naturally agree with them. But every entrepreneur planning something truly ‘disruptive’ needs to be aware of how the system works, or their disruption might just hit a regulatory jam. And until some major campaign finance reform comes down the pike (which I just don’t see happening, no matter what anyone promises), the online industry needs to get like Google and start paying for the propaganda of candidates that’ll back them. Individuals too – I chip in for causes I strongly believe in, do you?
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Greg – don’t you think it’s a little harsh calling efforts to monetize a virtual gaming site like PicksPal an “investment newsletter scam”? As I’m writing this post I’m looking at Google Adsense next to your post for ‘how to claim government land’ and ‘congress ringtones’ and chuckling at how you and I are both somewhat powerless to control exactly what is shown on Adsense. Point? It could be a *real* scam there.
People don’t have to click on ads or buy those PicksPal picks if they don’t want. The flipside is for people who would like to play in a pool at the office for fun (or to wager something harmless like who buy’s lunch) these sites have a target market.
And maybe they’ll pull away a few folks who are doing real gambling online and could get into trouble.
There are some real “scams” out there to target and vent on but I don’t think PicksPal is a fair target for this type of scorn.
I agree with the rest of your rant about the government angle, though.
Here’s something related on ‘Net Neutrality’ politics. The shatteringly painful views of Bob Frankston:
http://www.frankston.com/Public/Default.aspx?zz=xcs&Script_name=/default.aspx&name=Opportunity
I wish Bob Frankston could find a PR team for his spiel on the FCC, the telcos and Net Neutrality. He’s too hard to parse on his own.
Google should have hired Bob along with Vint Cert and put their PAC money behind this battle.
TDavid,
Yes, it’s a little harsh.
But it does work the same way as a common investment newsletter scam.
You send out 100,000 letters saying a stock is going is going up, and 100,000 letters saying the same stock is going down.
The next week, you take the 100,000 that you happened right and divide them in half. To 50,000 you send a letter saying another stock is going up, and 50,000 saying the same stock is going down.
Repeat for a few weeks.
After six weeks you’re still left with over 3,000 people who you’ve picked stock winners for six weeks in a row.
You then market these people a very expensive newsletter, based on your past ‘performance’.
It’s no different than what PicksPal is doing by marketing the picks of the top thirty guys over the past five weeks as ‘geniuses.’ And offering those ‘genius’ picks for sale strongly implies to me that they’re looking to attract people looking to make a quick buck off the sale – just like people who fall for investment newsletter scams.
I’d need a heck of a lot more data about the performance of the average participant and the size of PicksPal’s user pool before I could determine whether someone was good enough to be more than lucky. We’re talking high degrees of statistical significance.
I don’t think we’ll get the raw data from sites like PicksPal, Greg, so we can definitively answer those questions, but they are just mining and marketing their databases which I don’t see a problem with doing.
That would be interesting though and I bet you’d see others try to make money in similar ways from the data as PicksPal is doing. I wouldn’t be surprised if the service takes off if you don’t have people scraping the site for that kind of data anyway.
As for those group of people being any more “lucky” than the rest? Some might have the benefit of being more knowledgable about the specifics of certain matches. There is something to playing by the numbers versus simply guessing but then you can’t count on the freak accidents and injuries during matches or stupid managerial moves.
Bottom line: those people who got lucky five weeks in a row could just as easily go 0-5 the next five weeks while the dude who guessed on games by flipping a coin went 5-0.
Interesting discussion.
Interesting site, but I don’t se why I have to pay to get the information. I found a site try2bet.com (also a sports betting site where there is no real money involved besides the prizes) where you actually can see what the top betters do and learn.