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Amazon Collapses Under Weight of 1,000 Xboxes
theodp writes "Is there such a thing as a BusinessWeek Cover Jinx? Amazon was bitten by the success of its 1,000 Xboxes for $100 promotion, which brought the entire site to its knees for about 15 minutes on Thanksgiving Day. Singing the too-much-traffic blues on Black Friday were Wal-Mart and Disney."
I wonder why they didn't just setup a basic html page or two for the home page in order to handle the traffic. By enabling a landing page for 15 minutes or so, they could have directed all the folks seeking these incredible deals to the correct page, instead of ensuring everyone is fed dynamic CPU-intensive pages. It's not like it's the first time that Walmart or Amazon have experienced traffic spikes.
Crack - Free with every butt and set of boobs
well, the article said it was sold out in 29 seconds.. so yes.. there is no chance...
They were selling 1,000 XBox 360s for only $100 a piece. The deal started at exactly 2PM EST, the exact period of time Amazon went down. Entire forums of people were sitting and refreshing the pages. It was pretty easy to gauge what the cause was. :-/
Javascript + Nintendo DSi = DSiCade
here evil grin
I had two networks to choose from: Comcast cable modem, and a supposedly "slower" SBC DSL connection. I ended up using the DSL as Amazon went unreachable on the cable modem at 5 till 1 (CST). At 1:00, Amazon was taking 10-20 seconds to load, but it did load. I clicked, answered a simple math question ("what's 18 + 19" IIRC), and it gave me the "you've got it" page.
I'm still shocked I got it, especially since I'm in Chicago, not on the west coast.
. The guy will probably protest it though.
The simple truth is that interstellar distances will not fit into the human imagination
- Douglas Adams
So was Amazon selling 1,000 XBOX systems at $100? Or selling a $1,000 XBOX system at $100?
It could be that the only purpose of your life is to serve as a warning to others.
That's what typically happens when marketing is out of touch with engineering. My educated guess would be that marketing droids "forgot" to mention this promotion to engineering. If they did, assuming that Amazon's tech team is any good, this idea would get shot down pretty quickly as one which would creating a DOS attack.
And of course it was the tech team which ended up spending its holidays fixing the site, not marketing. (You can probably tell that I am taking it a bit personally and for a reason...)
"You mortals are so obtuse." -Q
Actually, there was. I heard rumors that going directly to the ip would have it load. I imagine that disabling images and what not would improve your chances. Simple common sense stuff, but nothing that would give anyone a guarantee. Alas, it was fate that sold these things.
Apple relatively rare deals on iPods bought store was down for a couple of hours today.
Here's the buyer asking if the contract is binding including an email from the seller.
Jeez - You would've thought they were selling Bags Of Crap with the way that server went down...
On a serious note. They knew this was coming. It was marketed heavily and they should be ashamed for not being prepared to handle the onslaught of refreshers.
How does Amazon think that a promotion like that would increase overall sales anyway? What they should have done is said that XBoxs will be onsale randomly throughout the day, so check the price from time to time to see if you are a lucky recipient of the sales price. There will be 100 randomly allocated sales items to customers each hour until the promotion ends.
That would bring more traffic to their website and keep it there all day. Much better idea!
Oh wait... Hmm....
It is your personal duty to fight for what is right on a daily basis. Ignoring injustice is identical to approving
CompUSA and Best Buy. Black Friday must be a living nightmare for the half-assed tech staff shopping stores must hire to some extent.
Surprisingly enough, Circuit City loaded perfectly fine. Does this say something about it's popularity, or it's hiring practices for IT?
Ping is blocked by Amazon's firewall.
I'd buy an XBOX 360 for $100 .. heck I'd buy 10.
Based on the fact CompUSA is running on IIS, Best Buy is running Apache on Linux via Akamai and Circuit City is running SUN One via Akami, we can conclude that Comp USA's tech is half-assed, and Best Buy and Circuit City's techs may be half-assed, but Circuit City is helped by being less popular.
Ehh. This is nothing new. You should see Woot.com after they throw up a Bag-o-Crap on the site during a "wootoff". Their site at least says "Server is to Busy". Maybe Amazon.com should have thought twice before deciding to do a stunt like that.
Hey wait a second. When was the last time a Microsoft product cause a VOLUNTARY distributed denial of service attack?
Procrastinating life a way at a rapid rate of speed.
I haven't been able to get into the Apple Store tonight, it's been down all evening. They had a big one-day sale today, I bought a Bluetooth Mighty Mouse ($11 off, yay!) this afternoon and now I can't back get in to check the order status.
I've never heard of the Apple Store going down under a high load, but it often goes down briefly when product or price changes are made. I figure it didn't go down due to high traffic, but this is a rather long outage, compared to most updates. But still, it should be giving a "down for updates" err msg instead of a generic WebObjects error page.
Which leads me to think: was this a beta test for this EC2 system? I mean, there's no better bait for the millions of youngsters out there than a cheap top-o-the-line console. What better way to stress test your system than to have 100s of 1000s of people hit your site at the same time? If Amazon has logged the traffic data (and they'd be incredibly stupid not to), it would be a gold mine for their engineers. Eventually expect them to offer just such a service which can handle the such spikes, and pitch it to the Best Buys and Walmarts of the the world.
Is it just me, or is the first year I've really noticed any sort of competitive pricing on game systems. Generally it hasn't mattered too much where you bought your game system, because they were pretty much exactly the same price wherever you looked. But this year, I got an ad for a $100 rebate on an XBox360 from MicroCenter, and now this stunt by Amazon...
...wish I'd gotten one...
ZuluPad, the wiki notepad on crack
Now let's see of they can survive a slashdotting!
I will forever be a student.
No I don't have proof, but having the most prominent retail website in the world hawk your product is worth a lot of cash. The $100 special gets reported by multiple media sources, "1000 Xbox 360s sell out in 9 minutes", "Demand for Xbox 360s brings down Amazon's website". If Sony wants the headlines of people going crazy about the PS3, why wouldn't Microsoft want the same? Does anyone believe that 10 minutes of poor connectivity will hurt a website's reputation? Server problems yes, super cheap deals no. "Oh no, too many people are coming to our website for the great, great deals!" People are going to associate Amazon's name with amazing one time sales, which is only going to help them. Both Microsoft and Amazon have benefited from this sale.
I was able to get one as well. For me it was a matter of what browser I used. Safari & Camino wouldn't load the site at all, but Firefox worked just fine. However, once I got the discount code, I had to wait about an hour to check out because the entire site became unresponsive.
The fact that the Amazon jungle has collapsed under the weight of a thousand boxes surprises me little. In fact I thought the number would have been more. Boxes to transport wood, made of... wood... it's no wonder really. This is a sad day. The diversity of species in the Amazon is huge. The fact that it has collapsed is worrying to say the least. This is likely to result in a whole series of follow-on effects: Global Warming will quicken; The ice-caps will melt; The Ozone Hole will become a non-issue (the hole will be so big, we'll start calling normal bits of sky the Ozone Zones). I have no idea why nobody thought of the children.
Because if everyone had to keep clicking through the checkout process, every transaction would add another 3 or 4 page loads. One click is merely a way to avoid these extra page loads and not bring down the server too often.
That, and it also explains why there's no link in the story - we don't want to slashdot Amazon again, do we?
"I imagine that disabling images and what not would improve your chances. Simple common sense stuff,"
Disabling images is common sense... until they throw a captcha (or other critical graphic) at you that you need to see to claim the prize.
Exactly the same thing happened to Madman's website when they had an online AU$10 DVDs for 10 Hours sale to celebrate their tenth anniversary. The website was completely inaccessible for those 10 hours, and led to a lot of irate anime fanboys. ;)
It's a Bagel.
A lot of the traffic came from Digg... the $100 XB360 story was on the front page twice. Once when it originally broke, and a reminder on thanksgiving.
-jX
Don't you just love politics? It's like a comedy of errors.
Most things collapse under the weight of just one xbox. I'm surprised that Amazon survived as long as it did under something so hueg.
+5, Truth
I had two computers refreshing the page on my DSL connection (a bit redundant and counter-intuitive, I know)... took like five minutes for the page to come up.
Here's the kicker: it came up at around 11:01 AM PST. Sold out.
"Hegelians, who love a synthesis, will probably conclude that he wears a wig." - Bertrand Russell
It must be the excessive packaging that they use these days. All that cardboard has to come from somewhere. It might as well be Amazonian jungle foliage, since the rain forest is doomed from the pollution everyone will cause when they fire up their X-Boxes, Wiis, and PS3s (and the TVs they connect to).
When our name is on the back of your car, we're behind you all the way!
But look at the people's responses. A ton of people are saying it was a lie. There never was any Xbox systems at that price to begin with. It was a fake promotion? Evil Amazon??
It was up sporadically during those ten hours, and I was able to actually get through the checkout at hour nine. Of course, I'd pre-prepared my list of purchase because I knew that their servers would crash. Just like when Virgin Airlines offered a limited number of $1 flights in some promotion they had.
A game has objectives and is competitive, anything else is just play
It's less competitive pricing and more "bait and switch". They are sold out of what you want, but since you are here why not look at all our other crap.
http://www.kubuntu.org/
This is the email I sent to the Associated Press after they reported the $100 X-Box 360 deal in a story, but failed to mention the number of consoles Amazon had for sale at the discounted price:
I imagine that disabling images and what not would improve your chances.
I don't think so. When I couldn't load the page in my browser, I tried telnetting in on port 80 in order to do a raw GET of the URL. I couldn't even connect to enter the command.
"...always new atoms but always doing the same dance, remembering what the dance was yesterday." -Richard Feynman
Entire forums of people How many Library of Congresses would it take to fit all those forums of people?
You are the first person I have seen claim they got the code. I didn't believe anyone did until now, but that's only because I also was able to make it to the question link...
...but when I answered the question (19 + 6), it turned me down. It was incredibly frustrating, because I was under the impression that I had already received a claim code (this is what the buying tips page said), and it was waiting for me to answer that question.
Screenshots: (1) The question | (2) The denial
This is 2006, not 2001. You're supposed to be making "PS3 is huge/expensive/crap" or "Wii = Piss" jokes.
Then you just right click and press "show image".
The AACS key is NOT 0xF606EEFD628B1CA427BEA93A9CA9773F
Disabling images likely wouldn't do anything. For one thing, the page would load with a placeholder for the missing image anyway. Also, the images are on a different server, so loading them doesn't even slow down the page you're trying to load. FlashBlock might have helped, as flash ads can cause the tables they're in not to reflow until the ad is loaded on some pages with tables. And using the IP instead of the domain name likely would have helped, because it may have been their DNS server that got overloaded.
I don't even live in America, but a week ago I re-opened an US Amazon account just for this promo.
Even considering shipping and customs (no less than 100 dollars I think) It was a hell of a deal...
Oh, after that, I browsed around the site and bought "World War Z" and planning to buy "I am legend",
Only 1000 people got the code. 1000 is a very small number, and it's unlikely that many of those 1000 happen to visit the same online hangouts that you do.
This whole thing is rather absurd (I'm speaking more to comments on the linked page rather to your specific comment - excuse me while I blather) - a bunch of people got their hopes up, against tremendous odds (it wasn't a small number of people who knew about this deal. I was at lunch and a lunchmate, who I thought was entirely unconnected with technology, commented that they had to get back to the office to get their "$100 xbox360"), and when they didn't "win" therefore the whole thing must be a giant scam, etc. Or...maybe, just maybe, 1000 other people beat them to it, among hundreds of thousands of people trying for the same thing.
[Checking lottery ticket]
OH MAN I DIDN'T WIN! THIS IS BULLSHIT! THE WHOLE THING IS A GIANT SCAM!
And how many ping-pong balls could fit in the fora?
Hail Eris, full of mischief...
E pluribus sanguinem
Presumably, the weight of the controllers contributed most to the crushing.
My Photography - http://ian-x.com
The Deathlings (comic) - http://thedeathlings.com
What? You didn't know that already?
The lottery is a tax on people who can't do math.
And this statement comes only from those who have no concept of risk/reward. e.g. That it can be entirely rational to "risk" $2 if you're not strapped for cash when the unlikely but remotely possible reward is millions.
I'm not even a lottery player, but I do find it rather laughable when the condescending, patronizing sort gives a spiel about odds regarding the lottery, confidently boasting about their own intellectual superiority because they shun such a thing.
Hours? All 0.25 of them, you mean? I mean holy shit, it says 'About 15 minutes' right there in the blurb.
Only a retard would say that. It would make no sense at all for Amazon to fake it. Let's say they lost $200 per xbox selling them in this promotion. With 1000 boxes for sale, that's $200,000. A good chunk of change, no doubt, but not really difficult to come by for a company with a market value in the billions of dollars. They've gotten a ton of press out of it, and all for a fraction of the cost of a 30 second superbowl ad.
Sure, they could've faked it, and then just relied on an overloaded website to avoid having to give out any real deals, but why would they want to have to deal with the potential PR problems if that truth got out? It would be beyond foolish for this to have all been a scam.
One time I threw a brick at a duck.
It's not the people who can afford and buy an occasional ticket that I railed against specifically, although the fact that they support such an evil, exploitative system makes me sick to my stomach. No, it's the people who are giving their money away when they can barely afford to buy food and shelter that worry me. It's a false dream, heavily advertised and targeted to the people who can least afford it.
It's not about being smug and superior, it's about being moral.
Slashdot - where whining about luck is the new way to make the world you want.
Thank you for writing about this situation which you encoutered with
our web site.
First, please allow me to express my sincere apologies for any
frustration that has been caused. It is certainly not our intention
for our customers to have anything but a pleasant experience at our
store.
We are working hard to provide a stress-free and convenient holiday
shopping experience at Amazon.com. Unfortunately, we have not met
that standard in this case.
Please note many customers voted for customer vote program and were
waiting to place their orders at 11 A.M. This caused high network
traffic and hence our web site was slow.
We utilize top of the line servers, internal routers and network
connections. Although we often wish we could avert this problem,
many issues regarding speed are actually a result of complex
routing patterns over the Internet itself. Even the best Internet
services can't get around this fundamental problems.
To help prevent this problem in the future, you can reset your
cachesize. Go to the "Cache" or "Temporary Internet Files" option
on your web browser (in Internet Explorer, go to "Tools" and
choose "Internet Options"; if you use Netscape, go to "Options" and
choose "Network Preferences"), and make sure you have your memory
cache set to 3000 kilobytes, and your disk cache set to 5000
kilobytes.
For instructions on clearing your cache on other browsers and
platforms, please consult your browser's help documentation for
details on how to manage this process.
We here at Amazon customer service continuously strive to assist the
customers in each and every way can and feel disappointed when we
are unable to address customer's concerns. I hope you can understand
our limitations in this regard. as if the problem were the fault of my firefox cache
They're using their grammar skills there.
I got one. Still can't believe it. Had the U.S. atomic clock in one tab and reloaded the page at 1:59:59 EST. Answered the question (20 + 16) and that was it. Didn't have to enter my password or anythiing. Didn't get a claim code, except through email as a backup. Just added it to my shopping cart and checked out. Well, I tried to check out. The site was inaccessible for 15-20 minutes and I was sweatin' heavy. But I bought it immediately when the site came back up. It shipped today.
I don't know about the US but here it's illegal to advertise a special deal (or even just a normal deal) and not stock it in any significant quantities.
Justice is the sheep getting arrested while an impartial judge declares the vote void.
Looks like his two PS3s are still for sale, though at a substantial discount from the $1999 he was origianlly hoping for. I hope he enjoys playing with his two shiny PS3s, 'cause he's still horribly overpriced. The dude has completely missed the window of opportunity.
Amusingly, on the updated eBay page, he's removed the pics of his girlfriend, but retained the fish photo. Maybe he'll throw in some fresh fish filets:
Butthead eBay gouger : Hmmm, I'll make a quick buck by gouging some desperate fool
Butthead eBay gouger : please please PLEASE SOMEBODY BUY THESE DAMNED videogames!!! I don't want to get stuck with them. All my jock friends will make fun of me.
Maybe if you buy his PS3 for $2000, his girlfriend will give you a "happy ending". And the fish must be for the fetish freaks.
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Hyperbole much?
Yes, it's a projection, genius.
Funny thing is that I don't play the lottery, but if you simply think of a $10 million dollar jackpot as 5,000,000x$2, you've, exactly as I mentioned, completely missed the whole point of risk/reward. The risk of $2 is negligible to many people's lifestyle (less than a good cup of coffee), for a potential, but remarkably unlikely, reward that is enormous.
Is it always cool to downmod when you can say so much in one word? Few things in life can be done like that. Amazon.com screwed up, which is pretty weird to me given how many people mantain and check for errors. Oops! Besides, it's pretty bad a bunch of fanboys can crash a site that should be able to resist traffic spikes. So not only was my point valid, it generated interesting conversation. apparently that deserves a 0.
"No freeman shall ever be debarred the use of arms." -- Thomas Jefferson
Certainly don't disagree with this. Personally I find it reprehensible that governments not only sanction it, but they're the ones advertising and pushing it.
Having said that, at least in my area the "profits" go towards good causes (libraries, youth athletics, etc), at least marginally making up for the damage it causes.
Happy ending? Didn't you notice her braces??
'Thats they exact same thing a banana wrench monkey.'
Twice now you've failed to rationally explain your unique vision of risk reward. Ah, maybe you simply don't understand the word rational. Yes, that must be it. Hey, why don't you reply again with your argument that $2 is very little money and therefore no matter how low the chances and how short a human life is, there is still a viable risk/reward scenario.
Who thinks that $10m is 5m x $2? Basically you aren't doing the math if you think that that reward is enormous compared to the risk you are taking and the odds you are getting. You are not correct, yet you attack people that are. Pretty arrogant.
Whether the best is $2 or 1 penny, whether the reward is $1 or $100 Billion, if you ignore the odds, you have not setup a viable risk/reward scenario.
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Indeed, right over your head.
Whoosh!
Whoosh!
Whoosh!
Who said anything about ignoring the odds? The point, my dear moron, is that even if the odds are 1 in 13 million, the risk/reward for many people is well justified spending $2 for a $10 million jackpot (despite the purely mathematical break even point being, duh duh, $26 million). It's a fundamental disassociation that some autistics and asperger suffers just cannot make themselves understand.
Again, though. Whoosh!
I completely agree -- according to the Wikipedia entry for "bait and switch", it matches almost exactly:
A bait and switch is a form of fraud in which the fraudster lures in customers by advertising a good at an unprofitably low price, then reveals to potential customers that the advertised good is not available but that a substitute good is. The goal of the bait-and-switch is to convince some buyers to purchase the substitute good as a means of avoiding disappointment over not getting the bait, or as a way to recover sunk costs expended to try to obtain the bait.
Should have thought to use the HTTPS link to instead. :|
Although I managed to get to the verification page using the HTTP link, their dumbfvck servers didn't think that 8 + 6 = 14
The lottery is a tax on people who can't do math.Where does this come from? I've spouted it before (when I was much younger), but it's just wrong.
The lottery is:
A. A tax on people who want to dream so much that they wouldn't do math if they could.
B. Perfect for people who can do math.
Look at it this way. Much like blackjack, the lottery is a game with history, in which the odds/payoff ratio varies over time. If you bet the same amount every time you play, you'll end up losing out (the payout on the lottery doesn't climb as quickly as the money that goes in). However, if you wait to play until the payout is large enough (and these days, that's quite large), your dollar played is worth, probabalistically, more than one dollar.
You don't even have to deal with the risk of getting tossed out of a casino.
Yes, I understand that the lottery attracts a great number of low-income purchasers and is, as state-advertised gambling, wildly hypocritical in many places. Still, from a purely academic perspective, it suits mathematicians just fine.
I work the midnight shift and am never able to get on their site during those times. Does that happen to anyone else?
Way to act like a 12 year old loser. You have no idea what you are talking about. Before you use words you don't understand, I suggest you read about game theory. Nice of you to resort again to attacking me and actual facts instead of bringing a real argument to the table. You need to go back to jerking off because you are obviously no good at this.
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Now, why whould they do this?
If they got a couple million people on their site as a result of this insanity, they only need to get about $0.10 per customer to make up for what they lost on the promotion. Well worth the money.
Sometimes boldness is in fashion. Sometimes only the brave will be bold.
Uh huh.
Completely over your head.
Oh, and let me guess - home insurance is a scam, right? I mean the premium xs the statistical period loss definitely makes it a losers game, right?
Idiot.
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Bwahahahaha. I guess you haven't even achieved the level of retarded monkey (though "alleviation"? Now there's a key piece of terminology that pretty clearly delineates your knowledge).
Actually, my dear idiot, the same concept applies to both, although the monetary balance flips. A small expenditure for an incredibly unlikely great reward shares startling fundamentals with a relatively small expenditure for an unlikely great risk. In both cases you are a net loser, but one would have to be a startling idiot to say that home insurance is only for people who are bad at math.
Hey, chalk that one off - the sub retarded monkey has that one covered.
You really don't put any thought into your replies, do you? People that pay for home insurance do so because they cannot afford the risk, WHICH IS VERY REAL. I.e. A high probability relative to winning the lottery. As that risk decreases, the number of people carrying the insurance drops.
You apparently believe that people in Kansas should buy insurance against icebergs.
Me, I feel that taking the odds of an occurrence happening in addition to the "great risk" and the "small expenditure". You have taken the side that the odds don't matter.
Additionally, those who can afford to cover a large loss SELF INSURE because it is overall more profitable. Obviously, you are not in that situation or it would have occurred to you. I hope you become successful, though any success will obviously not be based on critical thinking. Your brand of logic smarts of amateur emulation of Limbaugh or Hannity... it sounds great on its face, but cannot stand up to inspection. Your only success can only come at being critical (however incorrectly) of others while contributing zilch yourself.
Oh, and your repetition of "my dear idiot" shows you as terribly uncreative. Your writing smacks of arrogance (as I said earlier and you have proven that out again and again) and of a fragile psyche. In this particular situation you are wrong, and the sooner you admit it, the sooner you can get on with life, you chowder head.
*sigh* your writing style has made this sentence unintelligible. Your antecedents have become thoroughly lost.This comment is guaranteed*
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A mathematician would look at his Expected Value as it pertains to game theory. As such, yes it may be that in certain situations there is +EV, but they don't exist in reality. This is due to the fact that MORE people would play, cutting down on what you could possibly win (splitting pots, etc).
If there ever comes a time when there is +EV for a play in the lottery, then I guarantee that the lottery would cease to exist -- the pot would change. The people running the lottery kinda pay attention to that. Academically, the lottery is very interesting, however in the real world, no mathematician would ever put money on the line expecting +EV.
Let me re-phrase the joke for you that once made sense when you were young: Anyone that pays for a lottery ticket ever expecting more money back is not good at math as the lottery is designed to be a -EV situation.This comment is guaranteed*
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You apparently believe that people in Kansas should buy insurance against icebergs.
Somehow I think the odds of icebergs causing damage in Kansas to be somewhat shy of 1 in 13 million. Having said that, plenty of people engage in insurance where the cost would be very high, but the premium would be low. A good example would be corporate contests where there's a very large prize, but an extremely unlikely probability that someone will claim. Guess what: Taco Bell is calling up Lloyds regardless, because insurance still makes sense.
Your writing smacks of arrogance
No one else is reading this, and I reply only out of humor. I am, however, right, and you are wrong. One day you will realize this. Human motivation isn't linear across a monetary scale, and this demonstrates itself frequently.
*sigh* your writing style has made this sentence unintelligible
Whoosh!
And that brings us full circle to my point: The odds need to be taken into consideration.
Thank you,QED
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That's just plainly not true. The sad thing is that the number of tickets purchased is not wildly responsive to the expected value of that play. It's responsive, but not as much as it should be in a strictly rational sense. Who wants to wait?
It's utter nonsense to say that "MORE people would play," to cover your bases on this one. Yes, more people will play, but that is merely a pressure on the game. It is not a forced constraint. In John Corbett and Charlie Geyer's writeup based on expected play of Powerball here, they came to an expected monetary value of $0.9651 with a $300MM jackpot and 80MM expected plays, accounting for the probability of other jackpot winners (all other prizes are non-shared).
Powerball has gone to $365MM. Even giving completely conservative numbers a run (cash payout of $171MM, even though a $314MM jackpot had a cash payout of $170MM, 100MM plays on that jackpot), we come to an expected monetary value of $1.07 on a $1 play. Don't say that something doesn't happen in reality when that very thing has happened in reality already. With the record payout, there might have even been a positive expected value after taxes. I hate doing my own taxes, though, so why would I bother running the numbers on someone else's?
Your sort of vague argument could be made against counting cards in blackjack, that the game must be constructed with a negative expected value at all times, but that is not the case. The game is constructed with a negative expected value (for the suckers/players) over the span of all plays.
Yes, I've done my homework on game theory, and I understand that it is very rare that one can consider coming out ahead with the lottery. Still, the suggestion that it isn't functionally possible to have a positive expected value for the game in the real world is just false.
I did neglect the fact that in certain situations, the value will exceed the odds. That's a good point. So yes, at certain points in time EV goes positive. (assuming odds of picking powerball winning numbers is 146,000,000:1. [5 from a bucket of 55 balls, 1 from a bucket of 42 => (5!/(55*54*53*52*51))*(1/42)] )
However, this is also simplifying in looking at a single all or nothing scenario, meaning that it would take many many iterations before this would hold true. However, the number of bets needed to make EV useful exceeds the number of opportunities you will have in your lifetime. Thank you for pointing out my oversight an generalization, though.This comment is guaranteed*
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oops, also you forgot to include taxes in your calculations. It was so long since my original post, I forgot we were talking reality vs academic, and taxes are so very very real :(
So, the number of times the payout * .4 (fed + state) > $146MM is even lower. Your $365MM big win drops to about $185MM lump then $111MM. So, you can only play in situations where the published number is what, $480MM?
Nevertheless, your point that the lottery can in some situations will have +EV still stands. You just are never in a position to take advantage of it.This comment is guaranteed*
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Don't forget the $0.1971 fixed expected value of the ticket (also subject to taxes). If we neglect taxes on small prizes (do you report $3?), one need merely have an after-tax lump-sum of ~$117MM.
I think it's safe to say that we're both safe from winning (or playing) the lottery any time soon.