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postcrastinator
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Discussion Starter · #1 ·
NBC promotes their generosity by awarding $1m prize to winners, but the 42-year old winner would be 82 years old before he actually receives the full amount in the year 2047 for his win in 2007. And how much would $25,000/yr. be worth in 2047 dollars? Imagine winning the $10,000 Pyramid in 1973, and they paid it off over 40 years in increments of $250/yr. You'd finally be getting your last check for $250 in six years -- in the year 2013! How much more could you have done with that $250 cash back in '73 compared to today in 2007 or in 2013?

As America's Got Talent 2's winner, Fator ... received a $1,000,000 prize and the show's "Best New Act In America" title. However unfortunately for Fator, unlike the winners of most other reality shows, he won't actually be receiving his full cash prize anytime soon.

Instead, similar to what NBC (which appears to have established a lock on the "America's Cheapest Reality TV Broadcast Network" title) did with For Love Or Money's $1,000,000 prize and Treasure Hunters' $3,000,000 prize, Fator's $1,000,000 prize will be paid over via a lottery prize-like 40-year period. Fator can (and probably will) opt to pass on the $25,000 annual payments and instead receive a lump sum, however should he do so, the present cash value of the prize will be no more than several hundred thousand dollars.

After revealing Fator's victory, Springer also revealed that Fator would also be receiving one more "surprise" prize. "We've got one more surprise for you," Springer told Fator. "We know your dream is to play Las Vegas, (so) we're going to make that dream come true. You're going to be playing the Jubilee Theater at Bally's Resort." Springer didn't reveal whether, based on NBC's "fine print" prize practices, Fator might actually have to pay for the privilege.
http://www.realitytvworld.com/news/terry-fator-crowned-america-got-talent-second-season-winner-5668.php
 

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The Question
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"Misrepresented"? In what way?

The guy's getting $1M. That's what was promised. Did they say that they'd get a single check for $1M?

Didn't the contestants get to read the rules on payouts before they signed up?
 

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Enlightened
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If I lose, I get my Turtle Wax and Rice-a-Roni up front, right?
 

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postcrastinator
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Discussion Starter · #5 ·
Amnesia said:
"Misrepresented"? In what way?

The guy's getting $1M. That's what was promised. Did they say that they'd get a single check for $1M?
Well, I just watched the last 10 minutes of the show, but Springer clearly said that "the winner will wake up tomorrow with $1m and the title of America's Got Talent champ." So that implies that the winner would receive $1m that night before he goes to sleep. If it's clarified in the contestant's fine print contract when they sign on to do the show (and it should be), that's okay for the contestants, but it's certainly misrepresented to the viewing audience, IMHO.
 

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Time for a new Title
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That's how most million dollar contests work. Heck, the lottery has been doing that for ages. I'm sure it's well represented in the paperwork you sign when you want to be on one of those shows.

Fator can (and probably will) opt to pass on the $25,000 annual payments and instead receive a lump sum, however should he do so, the present cash value of the prize will be no more than several hundred thousand dollars.
Man, only several hundred thousand dollars? How will he eat?
 

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getreal said:
And how much would $25,000/yr. be worth in 2047 dollars?
Using 8% discount rate, the value of $25,000 a year for 40 years in 2047 dollars is approximately $7 million ;)

Using 8% discount rate, the value of $25,000 a year for 40 years in 2007 dollars is approximately $325 thousand :D
 

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Time for a new Title
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TAsunder said:
I don't think that's how most of them work. The lottery does, but not game shows.
There's, what, 3 or 4 "Million Dollar" shows? I'm asking--I don't watch much TV.

But every million dollar giveaway run by something like McDonalds, or Doritos, or any other company that would do a contest like that is done as either a 20 or a 40 year payout (well, maybe there's some 30's as well).
 

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Save the Moderatоr
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Wow, I never expected that. In this day of production costs for an episode of a TV series being in the $2 million to $4 million range, I would never have expected these prizes to be paid as annuities. That's extraordinarily cheap of the producers.
 

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dswallow said:
Wow, I never expected that. In this day of production costs for an episode of a TV series being in the $2 million to $4 million range, I would never have expected these prizes to be paid as annuities. That's extraordinarily cheap of the producers.
cheap or really smart?
 

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ID-10-T
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Yeah it is very common for almost all sweepstakes to pay out in annuities.

I agree with Dswallow though, the networks are cheap. It is ridiculous that the prize for 13 weeks of Survivor is 1 million dollars or for close to 50 shows for Big Brother is $500,000.

That is why I think anyone who goes on these shows are foolish. They are seriously being taken advantage of...

A nobody on a sitcom who is in every episode is going to make as much as someone who wins a show like Big Brother.

The biggest stars will make more than the winners every episode.

All that being said, I don't know that paying out a million dollars in an annuity is misleading. It is cheap, but not really misleading.
 

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The Question
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The difference is that you need talent (or at least a good agent) to get a job on a sitcom. You don't need anything to be on a reality show...
 

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where is this place?
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I'd take the 25k per year, but then again, I'm only 24.

Great supplement for your current salary no matter what your current income is.
 

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Now with more GB
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getreal said:
NBC promotes their generosity by awarding $1m prize to winners, but the 42-year old winner would be 82 years old before he actually receives the full amount in the year 2047 for his win in 2007. And how much would $25,000/yr. be worth in 2047 dollars? Imagine winning the $10,000 Pyramid in 1973, and they paid it off over 40 years in increments of $250/yr. You'd finally be getting your last check for $250 in six years -- in the year 2013! How much more could you have done with that $250 cash back in '73 compared to today in 2007 or in 2013?
Actually, every AGT episode this season has mentioned that the prize was "paid from an annuity over 40 years" in the closing credits, and that the winner has the option of taking the current value of the annuity instead. (At least they mentioned it this year; no one has said if Bianca Ryan's prize from last year was handled the same way or not.)

Nothing new about paying large game show prizes over time; back in 1976, the top prize on $100,000 Name That Tune was $10,000 a year (they mentioned this every time someone had a chance to win it), and a few years later, the prize on $1,000,000 Chance of a Lifetime was also paid out over time (I think it was 25 payments of $40,000, but I'm not sure). (On the other hand, the two grand prize winners on The $128,000 Question in the mid-1970s were paid all at once.)

For the record, the closing credits on Power of 10 say that "some prizes are paid out over time."

(And speaking of Terry Fator's "bonus" prize on AGT, while they said he would be playing the Jubilee Room at Bally's, they didn't say if he would be headlining his own show or just be part of the existing "Jubilee" seven-act cabaret show...)

-- Don
 

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Banned
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Doesn't bother me much (I stopped watching a few episodes ago. I might watch the finale if I'm bored), but somebody should probably put a spoiler warning in the title or tag the spoilers.
 

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Go Pats
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isn't this the EXACT same as the lottery?

even if you get hit with like 50% tax or whatever, it's better to take the lump sum and invest it then the 40 year thing.

do not see at ALL what the big deal is.

Take the lump sum $1 million, uncle sam hits you for a lot of.

Do you want NBC to pay $1 million PLUS taxes?? :D
 

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So where's the line? It'd be much cheaper to stretch it out 50 years or more. Why not 100 years?

"And here's America's Newest Millionaire!!! ****"

(**** paid in 1,200 monthly installments of $833.33)
 
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