Are penny auction sites a scam?

To me I find it hard to believe that you can win a 50" HDTV that retails for $2000 for $50. The way it works is you buy bids for about 75 cents per bid and then you place a bid and the price goes up one penny each time a bid is placed and it seems if you dont win the item you just wasted money because you dont get your bids back if you lose out on the item your trying to win. You could spend $50 bidding on an item with nothing to show for it.