What a bunch of whining about 'fair'. It's simply the market at work - nobody owes you anything, not a certain amount of money per hour, not a certain amount of work, nothing. As long as there are people who want to do the work for the payout they get, the system works. If you find you can't make enough money on 99designs, you're free to get a job at McDonalds.
RFP's don't lead to BIG gains either - there are many contracts with a cost plus model. And most startups fail or whither on for years, with no real prospects. That's just how it works - don't like it? Feel free to do something else.
I'm a capitalist, because I feel it's the best system we have. However, there's obviously a wide spectrum of views that can be ascribed to capitalist philosophy.
I'm quite happy to be able to state my politics places me at the opposite end of the spectrum to you.
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"That's just how it works - don't like it? Feel free to do something else."
I'm happy to argue to my case - and to disagree with practices that I feel are unjust or unfair.
Logically and morally - this type of crowd-sourcing involves exploitation. If you carry out work for someone - logically they DO owe you something.
I think you might be missing the core of my point. They ARE big gains for some people... Just not professional designers in Western countries. Globalization at work.
Check out the top designers in the system ( http://blog.99designs.com/tag/top-designers/ ). Note the nationalities and the cost-of-living in those countries. These guys aren't entering hundreds of these contests out of desperation-- they are making a great living. It looks like the good ones are winning 12-20% of the contests they enter.
In a contest like this, the participants are simply competing for the chance to be paid.
I cannot fathom how this scenario can possibly be fair.