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Beware the $31.47 iPad

By
Philip Elmer-DeWitt
Philip Elmer-DeWitt
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By
Philip Elmer-DeWitt
Philip Elmer-DeWitt
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September 22, 2010, 9:35 AM ET
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Apple has stepped up production of its tablet computer, but not to the point of overstock



Image: Swipe Auctions

If the advertisement at right, which popped up in my inbox Tuesday as an e-mail from “Overstock Auction,” looks too good to be true, that’s because it is.

MacBooks aren’t selling for $49.68 and iPads can’t be had for $31.47. Few companies keep as tight a rein on retail prices as Apple (AAPL), and besides, it can hardly build iPads fast enough to meet demand. What are the chances one would turn up in an overstock auction?

We checked with Overstock.com (OSTK), which pioneered the sale of surplus merchandise on the Internet. Their spokesman disavowed any connection with Swipe Auctions‘ come-on and suggested it might be bait-and-switch spam.

That’s what it looked like to me. And in fact, Wallet Pop‘s Mitch Lipka posted a cautionary report in August about a customer who bid a penny on a Honda Civic at Swipe Bids — a company with the same U.K. mailing address as Swipe Auctions — and got bilked for $150.

It’s impossible to reach Swipe Auctions by phone, but they do offer a live chat service. After identifying myself as a journalist, I had the following conversation with “Gloria”:

Gloria: Ok, How may I assist you?
PED: The e-mail showed a picture of an Apple iPad with a $31.47 price tag on it. Is that supposed to represent an actual Swipe auction?
Gloria: It shows that if you place a bid on that you can win below market price.
PED: What does $31.47 represent? An opening bid? A final price?
Gloria: It shows might be somebody has won in this price.
PED: Might be?
PED: Do you now — or have you ever  — had iPads in stock that customers can bid on?
Gloria: Yes we also have ipad that you can win to place a bid.
PED: Thank you for clarifying that. I’d like to follow up with some questions with your public relations department. Do you have contact information for someone there?
Gloria: No You can contact us with live chat only.
PED: OK. Thanks for your help.
Gloria: Thank you very much for chatting with us today. We hope the rest of your day is an excellent one.

This turns out to be fairly typical non-response response from the company. For more on Swipe Auctions — A.K.A. Swipe Bids and BidSauce — check out the long thread devoted to them at the Complaints Board.

If you feel you’ve been ripped off by any penny auction site, you can file a complaint here with the FTC or with your state attorney general.

[Follow Philip Elmer-DeWitt on Twitter @philiped]

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By Philip Elmer-DeWitt
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