Pepsi Billion Dollar Sweepstakes

Pepsi Billion Dollar Sweepstakes logo

The Pepsi Billion Dollar Sweepstakes was a contest, announced by soft drink company Pepsi Cola on April 10, 2003 that ran from May 1, 2003 to September 14, 2003. For the contest, Pepsi printed one billion special codes, which could be redeemed either on the Pepsi website or via postal mail, and of which one million were instant cash winners (e.g. a US$20 instant prize). Of all the codes redeemed, which Pepsi estimated to be 200 million-300 million, 1000 were chosen in a random draw to appear in a two-hour live gameshow-style television special.^[1][2]

History

On the evening of September 14, the final day of the contest, the now-defunct WB network aired the special, entitled Play for a Billion. The 1000 people who appeared on the show each received US$100 and several of them were selected to play various games for a chance to win prizes. Each person was assigned a random 6-digit number, and a chimpanzee backstage rolled dice to determine the grand prize number.^[2] This number was kept secret and the 10 players whose numbers were closest to it were chosen for the final elimination.

In this game, the players were offered a chance to quit the contest in exchange for a cash payoff, but only one at a time could claim it. If no one accepted a particular offer, the player who was farthest from the grand prize number was automatically eliminated and won nothing more. The offers, as well as the time delay before the results were revealed, increased in every round until only one player was left. That person won a guaranteed US$1 million, which would become US$1 billion if he/she exactly matched the grand prize number. As of July 2013, this latter prize is the highest ever offered on any U.S. game show.^[2]

In the 2003 version, hosted by Drew Carey, Richard Bay of West Virginia claimed the US$1 million guaranteed prize, but did not win the billion-dollar prize (his number was 2-2-8-2-3-8, the winning number was 1-7-8-2-3-8, meaning that the first two digits in the number were incorrect).

Second edition

In 2004 the contest was repeated and Jon Kenney of Natick, Massachusetts, won the million-dollar prize, but like Bay from the inaugural edition, did not win the billion-dollar prize. Damon Wayans and Tom Bergeron co-hosted the television presentation in 2004, which was aired on ABC.

Insurance

Pepsi, unwilling to bear the risk of the possible billion-dollar prize, arranged for insurance company Berkshire Hathaway (coincidentally, the largest stockholder in Pepsi's competitor Coca-Cola) to insure the payout for a US$10 million premium.^[1]

Prize money

The US$1 billion prize was an annuity to be paid in 40 annual payments as follows:

• Years 1–20: US$5 million each (US$100 million after 20 years)
• Years 21–39: US$10 million each (US$290 million after 39 years)
• Year 40: US$710 million (balloon payment)

A cash option of US$250 million was available if the US$1 billion prize was won. The guaranteed US$1 million was paid as a lump sum in both instances.

References