I am one of the founders of Hack the North (in Waterloo). We completely agree. In fact, last year we didn't offer any top prizes. Instead, there was a "top 10" which got to present their hacks to everybody. This kept the event fun, and not competitive.
As a member of the team that "won" that hackathon, I agree.
Interestingly, one of my least-favorite parts about "doing well" at hackathons like these is that I don't get the opportunity to go around to other tables and see what everyone has else made, and talk with them about it. Sometimes, really cool projects and people go under-noticed (I've been there as well).
Uhm, to create something? For challenge? For fun? That's what hackatons and gamejams are for, aren't they?
But I have to admit that sometimes there are pretty nice prices - like on the last gamejam I attended there was an organized trip to bigger gamejam for the winners (except of small stuff like T-shirts). There were no judges, all attendees voted on their favorites. That's in my opinion the true hackaton/gamejam spirit.
I would attend a university sponsored hackathon that had little / no prizes. I would not attend a corporate sponsored one with bad prizes.
For example, AT&T recently held a hackathon in Atlanta. The prizes were meager, and it was clear to me that ulterior motives were present. Why would anyone attend a hackathon like that is beyond me?
I took home first prize at a AT&T hackathon here in Houston and I thought the exact same thing.
A lot of corporate ones are set up with contracts that leave your work at their mercy to continue without you. Unless there's a prize - it isn't worth it with these types of arrangements.
For social good, civil, city government, university etc - I'll do it with no expectations just to make a difference.
In the last year here (Austin), I've hosted a half dozen hackathons with no prizes.. not even silly prizes. It takes minimal effort getting 40-50 people, and some effort to get 100. On the other side, our last major social good hackathon (Hack for Change) had nearly 250 with no prizes announced up front.
(We did award SXSW 2015 badges to the "audience favorite" but that was a surprise at the tail end of the demo time.)
