I was reading Steve Tockey's book Return on Software and he mentioned it's quite beneficial to have such estimates. Let's say I have an oracle that spews out 50/50 estimates of cost/schedule/budget/size (function-point, story point etc.,) for a software project. You are equally likely to overshoot as you are to undershoot the estimate.
The question is, is such an estimate really worth it? Why or why not? Intuitively it seems to make sense, but upper management would want more confidence for their planning - but you can only get that from widening your range and maybe from historical data! But that is only a 'sense of security' and maybe totally false, since you can't really say if you overshot it was 10% likely and hence it's justified since you really don't know what that 10% even means, to be honest (I've seen people claim only 10-15% risk and don't even know where the percentages came from or what do they signify).
I could increase my confidence by widening the range substantially but it doesn't give anyone much information.
So if I were to put forth a 50/50 estimate of things would my life be any better?? How would/should a PM manage for such estimates?
UPDATE: I would like to clarify a point: It's not that we are just using the 50/50 estimate and basing everything on it. You could say that is our 'mean estimate' i.e., based on past data of actuals vs. estimates. We then specify a range using n-standard deviations depending on our required confidence. So the point is that our 'initial estimate' is the 50/50 point (the mean) - we are equally likely to be under/over it (it's an estimate!). Now having such a point and the +/- range around it how worthwhile is this estimate?