What's the difference between a sweepstakes and gambling ?
What is the difference between GAMBLING and INTERNET SWEEPSTAKES ?
What is the difference between GAMBLING and INTERNET SWEEPSTAKES
This question has been around for hundreds of years and depending on your interpretation you may never quite grasp why the two words have completely and totally different meanings.
In most municipalities the term "Gamble" or "Gambling" is referred to as this:
Gambling is the wagering of money or something of material value (referred to as "the stakes") on an event with an uncertain outcome with the primary intent of winning additional money and/or material goods. Typically, the outcome of the wager is evident within a short period.
Gambling has primarily 3 components :
1) PRIZE -
What you can win
2) CHANCE -
A random chance of winning a prize
3) CONSIDERATION -
Consideration is the term you're likely to be unfamiliar with (unless you're a lawyer). Generally the term is used to mean "money that a player needs to put up in order to make it into the pool of people from which there will be a winner from a prize pool. In other words, when you pay a dollar for a lottery ticket, that dollar is "consideration."
Now that we may have a better understanding of gambling and its components, let’s look in contrast as to what constitutes a sweepstakes and how they differ from gambling.
The easiest way to profile a sweepstakes is by using the McDonald's restaurant analogy.
A customer entering McDonalds decides to buy a cheeseburger, fries and drink. After the transaction is completed there may be a peel tab (usually on the cup) that allows the customers that bought the product to enter a sweepstakes. Once the customer pulls the peel tab on the side of the cup he enters the sweepstakes. Just like any sweepstakes no purchase is required.
Note that the customer did not buy the entry to the sweepstakes he bought the product (in this case it’s a hamburger, fries and a drink) and the entry to the sweepstakes was given to the customer for appreciation for buying the product itself.
This analogy is important because it showcases a fine example of "consideration".
Remember that "consideration is money that a player needs to put up in order to make it into the pool of people from which the winner will be drawn." The money "put up" in this case was not for the sweepstakes entry, on the contrary, the money was for the product.
In conclusion, the act or components of a sweepstakes lack consideration.
I will now show you why internet or phone time sweepstakes are no different than McDonald’s sweepstakes.
A customer enters an "internet cafe" and buys internet time on a computer.
(A customer enters a McDonalds and buys a hamburger, fries and drink)
In appreciation for the customer buying internet time the store owner allows the customer to have access to games he may have the option to play.
(In appreciation for the customer buying the hamburger, fries and drink) McDonalds allows the customer to have access to peel tab on the side of the cup that the customer may choose to "peel and reveal" aka "play"
In both scenarios, there are 2 components of gambling present but neither have consideration because the money did not activate the game, the activation of the game was given to the player in appreciation for buying the product.
THERE ARE EXACT RULES FOR AN OFFICIAL SWEEPSTAKES THAT MUST BE FOLLOWED OR THE EVENT AT QUESTION WILL NOT BE A SWEEPSTAKES AND CAN BE INTERPRETED AS GAMBLING.
Almost every sweepstakes in the United States offering prizes valued above $600 or greater will typically follow the following structure outlining the lifetime of a sweepstakes:
Creating the sweepstakes promotion for a sponsor or sponsors;
Who is conducting the sweepstakes
Advertising the sweepstakes, prize structure, and the official rules;
(Advertising the sweepstakes to your demographic
Opening date for receiving entries;
When the sweepstakes begins
Closing date for receiving entries;
When the sweepstakes ends
Drawing date to judge winning entries.
In electronic sweepstakes this is done instantly
Sweepstakes promotion judges contacting prize winner;
Prizes are won in accordance with federal or state guidelines
Winner filing publicity release with sponsor's sweepstakes promotion agency;
Each entry is automatically filed within the database
Winner filing affidavit of eligibility (compliance with official rules) with sponsor's sweepstakes promotion agency;
Winners are prequalified before their allowed to enter the sweepstakes.
Winner filling any required federal or state tax forms with sponsor's sweepstakes promotion agency;
Any winners above $600 are given a W-4
Winner receives prize.
By law, the sponsors of sweepstakes must not require the prize winners to pay any shipping or handing charges in order to win or receive their prizes.
Sweepers frequently send out SASE (self addressed, stamped envelopes) to receive free game pieces, official entry forms, and copies of the official rules that are unique and pertaining to individual sweepstakes promotions.
The difference between gambling and sweepstakes should be very clear now. Sweepstakes are set apart from gambling simply because of the lack of consideration. The ONLY difference between internet sweepstakes and a McDonald’s sweepstakes is simply the way the predetermined prizes are revealed. Remember, sweepstakes have been around for at least hundreds of years and it should be expected with the advent and popularity explosion of the internet, Smartphone and smart devices that sweepstakes promoters implemented traditional sweepstakes promotions into the tools that reach the mass of participants,
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