The "highest bid wins" response is far too simplistic. There are several ways in which a premature bid can cause the bidder to lose an auction or can cause an auction to close at a higher price.
Bidders who collect a certain item often become known to the community that collects the same. One major benefit of sniping is being able to keep ones interest hidden until the last seconds. When AS places the bid ~45 seonds before close, it gives other collectors a chance to decide if they are willing to pay more than their original plan. (They are able to get a better idea of the ballpark price needed to win.) Had they not known the collector was bidding on that particular item, they may not have bid so high in the end.
The "highest bid wins" response also ignores the fact that bidders are often convinced to bid more on auctions that have more bids/seem more popular. If AS snipes weren't placed so incredibly early, the bidders manually sniping wouldn't know more bidders were interested and might not bid enough to win. Having an AS snipe placed so rediculously far in advance just gives the competition time to re-evaluate their bidding plans. An extra bid often encourages others to bid higher.
I know I can easily place mutiple bids in the last 45 seconds of an auction. I find it unbeleivable that AS couldn't estimate the traffic better. Being off more than 35 seconds, or 600% is just ridiculous. AS, how do you explain such a huge overcompensation?
I know I will not be using AS to place my bids on Sunday evening in the future unless AS shows an effort to better estimate the traffic.