Check out this article on whether freelancing is a commodity or a profession.
My favorite part is this:
There seems to be a basic disconnect between what is needed to earn a living as a freelancer and what clients seem to want (at least on these outsourcing sites) to pay. The disconnect goes even deeper. Suddenly a client can define all aspects of a job from price to design, causing the designer’s role to change from that of a professional to that of a technician. It is unnerving.
I have to admit, though, I HAVE entered design contests in the past. I did so knowing that I may not win and get compensated for my work. I actually did win one contest for a website header, but it was the worst experience. because there were probably 20 revisions by the client and there was no contract to set the limits. Essentially I had no control over the project.
I won’t say that I’ll never enter another design contest, because I did enter another one only a month ago. I can say that I will do so with caution and much forethought, if for no other reason than to build my portfolio, when I’m looking for a particular client or project to include in my body of work.