Lowest Bid Can Win This Auction

Reporter’s Notebook: As 2006 gears up, I want to give a shout out to a unique idea I just came across that is truly an example of thinking outside the box.

Limbo is an online auction site. Ha! Nothing new there, right? Try this on. You win by capturing the lowest unique bid on featured items. In other words, you could win an iPod for as little as a penny. A Sony PSP video game player recently sold for five cents.

It may sound like the Bizzaro world version of eBay, but Limbo is in fact a very clever play on the traditional auction idea.

“We’re more like a game,” Rob Lawson, one of the San Mateo, Calif-based company’s three founders told internetnews.com. “You can always win at eBay with the highest bid, but with Limbo you don’t have visibility into what everyone else is doing.” You can bid up to twenty times a day.

Here’s the deal. Limbo is designed to be “played” on mobile phones. It costs 99 cents to place a bid on auction items which currently include a video iPod, Sony Plasma TV and Mini Cooper. You bid via text message and the charge appears on the monthly bill from your mobile carrier. (Yes, it’s another one of those seemingly painless charges — until the bill arrives in the mail.)

For now, Limbo is buying the items for users to bid on, but Lawson says the longer term plan is to have companies provide items and services for the publicity of being on the Limbo Web site, which is currently operating in a beta or test mode, but is open to the public to play.

Part of the reason for the beta is to get feedback on the service. Lawson says they have no particular demographic in mind. He says though most mobile services skew to the younger set, users of SMS messaging tend to range from young to middle-aged. “It will also depend on what we’re auctioning. If it’s a backstage tour with 50 Cent, that’s going to attract one set of users, while a vacation rental will appeal more to others.”

Lawson also said they’ve taken pains to distinguish the Limbo Auctions from gambling. He says a similar service in the U.K., markets as a gambling site. But Limbo doesn’t just take your money if you lose. Every 99 cent bid earns you “Limbo Loot,” a kind of credit that can be used to buy items in the Limbo store. As of this writing, the store is pretty bare unless, for example, you’re in the market for a T-shirt that says “I like to be on the bottom.” Lawson promises there will be more post-beta. “The idea is to provide items that have real value.”

Lawson and his partners know a thing or two about the mobile market. The founded a mobile applications provider called Enpocket. Last year Enpocket worked with T-Mobile on an application that let viewers of the FX Networks reality show, “Todd TV,” use their cell phones to give directions and control some of the action on the show. Lawson also says they have a portfolio of patents pending on the process behind Limbo Auctions.

I have no idea whether Limbo will succeed but I get a kick out of their creative approach. Trying to be a better eBay is a lousy business plan; but turning the formula on its head just might work. I hope we see more of this kind of thinking in 2006.

Dave Needle is San Francisco bureau chief for internetnews.com

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