Call now to win

0Ross • 13th May 2009 • Thinking • economics, media, television

On Marginal Revolution, Bob Baxley asks a question I can answer: why do so many competitions have trivial questions attached? Do they only want clever winners?

In the UK, it’s because a game that you enter at a cost (i.e. premium rate phone call) is defined as an unregulated lottery if the result relies solely on luck. Introduce suitable skill and you’re now running a prize competition, with much less regulation. The problem, especially for participation television quizzes, is defining what is a suitable level of skill. Does knowing that 4 results from adding 2+2 count?

This was addressed by UK regulator Ofcom’s consultation into participation television in 2006-2007. Interestingly, Sky responded to this consultation with a claim that “call TV quiz programmes amount to illegal lotteries.”

According to this article, the 2008 Gambling Act made the situation worse, and the regulations more complex:

The result is that if TV quiz shows want to continue broadcasting then they must comply with these new laws by making their competitions more complicated and ensuring that a number of entrants are ‘knocked out’ in the first round. Participants must also be kept to date, and detailed information must be stored on resilient databases for cross reference purposes. Also, where appropriate, they could either obtain a lottery license from the Gambling Commission, which would require the broadcaster to donate 20% of all profits made to charity, or qualify as a ‘free draw quiz’.

I imagine something similar applies in the States.