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I'm not sure how to feel about this guy after reading about "grab.com". Not sure how I missed that back in 2000 but apparently Andrew started a company with a "

I'm not sure how to feel about this guy after reading about "grab.com". Not sure how I missed that back in 2000 but apparently Andrew started a company with a "billion dollar prize" from an online lottery. Turns out no one one the billion dollar prize but someone won a million dollars from their random drawing. http://www.allbusiness.com/health-care/health-care-professionals-nurses-nursing/6016694-1.html http://www.allbusiness.com/health-care/health-care-professio... So naturally I had to look at the odds, and if you pull up grab.com from archive.org you see: "Billion Dollar Sweepstakes: GRAND PRIZE PAYABLE IN 20 ANNUAL INSTALLMENTS OF US $5,000,000 EACH, FOLLOWED BY 10 ANNUAL INSTALLMENTS OF US $10,000,000 EACH, FOLLOWED BY 9 ANNUAL INSTALLMENTS OF US $20,000,000 EACH, FOLLOWED BY A BALLOON PAYMENT OF US $620,000,000 IN THE 40TH YEAR, WITHOUT INTEREST. ODDS 1:2,404,808,340. NO PURCHASE NECESSARY. WINNER MAY TAKE IMMEDIATE PAYOUT OF US $170,000,000 INSTEAD OF ANNUITY." So 62% of the payment came 40 years later, otherwise a payout of $170 million. Lame. Yet, I guess enough people were foolish enough to sign up for it...

zach 16y ago
Very similar to the structure of the Pepsi billion-dollar prize, I think. http://en.wikipedia.org/wiki/Pepsi_Billion_Dollar_Sweepstakes http://en.wikipedia.org/wiki/Pepsi_Billion_Dollar_Sweepstake... Most huge cash prizes are annuitized. I went on Who Wants to Be a Millionaire (airing Wednesday) knowing that even if I answered every question correctly, I would at best be looking at a cash value of under $800,000. It's just the way it works, and it's always spelled out in the official rules.
- nowarninglabel 16y ago
  Well you make good points, but paying out 62% on the 40th year only seems a bit extreme, it's not quite an annuity is it if the payments aren't fixed to a certain amount?
- brucehart 16y ago
  They must have changed the prize distribution procedure for Who Wants to Be a Millionaire. I was on the show in 2000. They gave us a big speech about how if you win a big prize, they will literally cut you a check for that amount and you should talk to a tax advisor before spending anything. One of their early winners got into some tax trouble. I didn't win anything on the show, but they sent me a check for $400 in January to cover my taxes on the plane tickets and hotel.
  - zach 16y ago
    Ah, the primetime show with Regis. How many times I played their phone game. I went on the syndicated show, where they got rid of the qualifying round and now award everyone $1,000 even if they answer the first question wrong. However, they do annuitize the million and half-million dollar prizes and don't pay for your travel expenses (but again, everyone leaves with a $1,000 minimum).
djb_hackernews 16y ago
Indeed. I enjoyed watching his interviews and dug into his background out of curiosity. Totally turned off by him once I read this. Really shady.
pbiggar 16y ago
Every US lottery I've seen uses the same system. It's not nice, sure, but it's not uncommon. Also, since all the US lotteries use it, I suspect there's a reason. For example, perhaps the underwriters require it. (Or perhaps since they all do it, they all can do it).
- nowarninglabel 16y ago
  Could you point to a US lottery that uses this system? Every system I see does not use this system. They distribute by a normal annuity schedule with a fixed amount each year. http://www.usamega.com/powerball-jackpot-annuity.asp?state=NY&d= http://www.usamega.com/powerball-jackpot-annuity.asp?state=N...
  - pbiggar 16y ago
    OK, that's what I meant. I presumed the grandfather was complaining about the lottery being split over multiple years rather being awarded all at once (like the UK or Irish lottery for instance).

zach 16y ago

Very similar to the structure of the Pepsi billion-dollar prize, I think. http://en.wikipedia.org/wiki/Pepsi_Billion_Dollar_Sweepstakes http://en.wikipedia.org/wiki/Pepsi_Billion_Dollar_Sweepstake... Most huge cash prizes are annuitized. I went on Who Wants to Be a Millionaire (airing Wednesday) knowing that even if I answered every question correctly, I would at best be looking at a cash value of under $800,000. It's just the way it works, and it's always spelled out in the official rules.

nowarninglabel 16y ago
Well you make good points, but paying out 62% on the 40th year only seems a bit extreme, it's not quite an annuity is it if the payments aren't fixed to a certain amount?
brucehart 16y ago
They must have changed the prize distribution procedure for Who Wants to Be a Millionaire. I was on the show in 2000. They gave us a big speech about how if you win a big prize, they will literally cut you a check for that amount and you should talk to a tax advisor before spending anything. One of their early winners got into some tax trouble. I didn't win anything on the show, but they sent me a check for $400 in January to cover my taxes on the plane tickets and hotel.
- zach 16y ago
  Ah, the primetime show with Regis. How many times I played their phone game. I went on the syndicated show, where they got rid of the qualifying round and now award everyone $1,000 even if they answer the first question wrong. However, they do annuitize the million and half-million dollar prizes and don't pay for your travel expenses (but again, everyone leaves with a $1,000 minimum).

djb_hackernews 16y ago

Indeed. I enjoyed watching his interviews and dug into his background out of curiosity. Totally turned off by him once I read this. Really shady.

pbiggar 16y ago

Every US lottery I've seen uses the same system. It's not nice, sure, but it's not uncommon. Also, since all the US lotteries use it, I suspect there's a reason. For example, perhaps the underwriters require it. (Or perhaps since they all do it, they all can do it).

nowarninglabel 16y ago
Could you point to a US lottery that uses this system? Every system I see does not use this system. They distribute by a normal annuity schedule with a fixed amount each year. http://www.usamega.com/powerball-jackpot-annuity.asp?state=NY&d= http://www.usamega.com/powerball-jackpot-annuity.asp?state=N...
- pbiggar 16y ago
  OK, that's what I meant. I presumed the grandfather was complaining about the lottery being split over multiple years rather being awarded all at once (like the UK or Irish lottery for instance).