I was invited by a friend to New York City’s Coffee Shop Lounge, where about 150 “b” and “c-level” independent music industry executives, djs, artists, performers, songwriters and ancillary music hanger-ons from all walks of the industry gathered to listen to a pitch from New York’s most recent “Music 2.0” (an acronym describing the post-crash Internet music economy) start-up, BurnLounge.com.
The company launched a multi-level, viral marketing campaign to have designated sponsors (otherwise known as “music moguls” according to their literature) sign-up partner’s interested in hosting a downloadable music store on their own web sites using BurnLounge.com’s music download store package.
A flashy, slickly produced, techno-laden infomercial was shown mid-way through the get together on the bar’s flat-panel tv’s, giving the crowd a generic look at how one can get involved in “making money” (as one of the principals emphasized in a follow-up speech) by selling music downloads as a registered partner in BurnLounge’s affiliate program. From the video, I learned about the three distinct tiers an affiliate partner can sign-up for; the Music Fan, The Affiliate and The Music Mogul.
The first tier, Music Fan, is for the general consumer or music fan who wants to feature tracks of his/her fav artists by embedding links to specific titles from BurnLounge’s catalog on their personal web page. The more tracks sold, the more points earned for redemption on BurnLounge.com’s site for prizes distributed as products or downloads.
The second tier, the Affiliate, is a program that turns downloads into cash. Targeted to small and medium sized web sites, BurnLounge will license their technology (basically a fully-functional download store with complete backend and transaction technology) for a richer user experience. Take this package and share a percentage of your download revenues with BurnLounge.
The third tier, Music Mogul, has a chief sponsor (or “mogul”) signing up a number of other web-based partners to create their own mini-network of sites. The Music Mogul manages those relationships, benefitting by taking a commission of sales of all tracks on his/her own download store as well as a percentage of all transactions within the mini-network of sites he/she is credited with signing into the program.
I admire BurnLounge.com for coming up with a way to spread their brand and using web services to generate sales with this multi-level marketing strategy, however, there are a few kinks in the armor if anyone thinks they’re going to make millions tomorrow from music downloads.
Mom and Pop are up against a formidable array of legacy download providers who currently have a tight strangelhold on the market and benefit from preferential treatment because of their size, traffic and revenue generating capability.
Take into consideration the folowing:
The article reported Napster is stating over $100 Million in cash reserves and 500,000 registered subscribers paying $9.95 a month. Not bad work if you can get it. One web site generates all those subscription fees! And, people said that would “never happen!” Well…it’s happening!
Real Networks claims 1.2 Million subs to its Superpass and Music store subscription service. Today, I cancelled my account because I can’t play Real files on an iPod, and frankly, I’m not interested in listening to radio content from sub-saharan Africa. I guess there are many people who need or want that kind of programming. More power to’em, I say! I love Real. I even own stock in Real, but until interoperability takes place, I’m on the sidelines for now.
The iTunes store, benefitting from Apple’s powerful marketing muscle and convergent digital lifestyle strategy, have to date sold over 500 Million downloads and almost 40 Million iPods. Remember, iPods can only play AAC and MP3 format. Sales of digital media players that play all other formats, including Sony’s A-Trac, Microsoft’s Windows Media and Real Networks Real Media lag far behind.
You cannot purchase songs from Burnlounge, unless they were in .mp3 format, to play on an iPod. It’s common knowledge that Apple will not license their proprietary AAC encoding format to other companies as they protect their idea by maintaining their market share and dominance. This single fact slices your potential download market in half or even more! No one at the event said anything about that. All they said is, “you can make money too.”
In addition, consider this:
BurnLounge.com license their tracks from LoudEye, a digital distributor. The company charges a (according to the biz dev person I spoke with on the phone two weeks ago) $100,000 upfront payment to help a client launch an online store using their technology with an additional $10,000 a month licensing fee to keep it running and have access to their music database.
The woman I spoke to broke down the commission structure for me. First, the label take is about $0.70 cents per download. Then, LoudEye takes between, I think she said, $0.12 to $0.18 cents a transaction, depending on the deal you broker with them.
So, for arguments sake, let’s say it’s $0.15 cents. BurnLounge.com takes $0.05 cents per transaction when you sign up with them. So, between the labels, LoudEye and BurnLounge.com, the total take before you see any money is a grand total of $0.90 cents. I think there’s even another split of a few cents for the publisher, or something like that, but don’t quote me on it, because I’m not exactly sure. Maybe that comes out of the label slice. I’d have to research it a bit more to be exact.
If you’re an affiliate, you have to share that $0.10 cents with your “mogul,” leaving you with 5 or 6 cents on the dollar. Now, figure in your overhead, web maintenance, employees, marketing costs, etc…
You’re making a few pennies on the dollar. You’ll have to sell hundreds of thousands of downloads to make any kind of real money. After marketing and promotion costs and other costs of doing business, it just doesn’t make fiscal sense to open a BurnLounge store. I’d rather go out and find investors and compete on a level playing field, then give BurnLounge my money and have to work ten times as hard to make ten times less than I could if I were and independent download store owner.
The BurnLounge folk say one of their partners, a Hawaain-based lawyer, made $50,000 dollars in commissions last month. His store consists of hard to find Hawaiian music, as I’ve been told. And, we don’t know what the terms of his deal are. Does he own the actual music? Is the music he’s sold considered major label music or is it niche music that only he has the rights to?
If you’re one of those 140 in the room, you’re competing with everyone else in that same room by having those same million tracks from LoudEye. The only differentiation is how you want your store to be perceived. Content on the home page can be changed to feature music that may interest your target audience, but is that the point?
Oh, one thing I forgot to mention, BurnLounge.com’s start-up fee is $144.00 or so, plus a montly subscription fee of around $12. So you’ve got to sell a lot of downloads to make up that estimatged $360 for the year, before you even can think about turning a profit.
Again, I’m not saying it’s a bad idea. It can work for some people. If you’re a Music Mogul and you sign up 100 sites that are premium brands, and they use the technology effectively and market to their customers, you can stand to make that $50K a month in commissions.
It’s the slackers that will kill you. Sign 100 restaurants and lounges and hope that they upadate their music pages and promotional web sites on a timely basis. Make the sites an integrated experience with the brick and mortar operation and maybe you’ll see some traction, but when it comes to online production, it’s tedious work just like any other data entry job. Why do you think we’re outsourcing all this data entry work to India? Because American’s are too busy consuming to do that themselves.
Now remember, you’re competing against major players in the download world; Apple, Sony, Microsoft, Napster, AOL, Yahoo and maybe someday Google. You’re at a immediate disadvantage because the iPod only play AAC and MP3 formats for audio and .mpg and .mov for video.
Major label content downloaded through BurnLounge is encoded with a DRM using other formats that won’t play on an iPod. I’m sure there’s a crack somwhere, but at the end of the day, it’s all about access and portability, isn’t it?
If you’re sitting at home cracking proprietary files, that’s less time you have for the beach, running, work or doing whatever it is you love to do. There’s a reason why million’s have downloaded from the iTunes store–it’s called convenience.
Being a pioneer in the Internet music space, many of my friends from the dance music industry who were at the event asked me what I thought about the program. I told them out of the 150 or so people who showed last night, only 2 (besides the BurnLounge principals on hand) will make any real money. Everyone else will decide that it’s too hard and that no one told them they had to invest so much time, money, energy and passion into something that gave them pennies as a return on their investment.
As for Netmix, would I open open a store? Well, for me it would only be a value-add to my constantly evolving business plan to drive traffic. Kind of a loss leader, like Walmart selling DVD players for $25 and CD’s for $10.
I’m not going to start my own music store, so sure, I’d partner up with BurnLounge to see what happens. It’s a write-off for me if I don’t make my $360 back and maybe I can sell some of the tracks I feature in my mix-shows, who knows?
Do I plan on making money with it? Well, from the looks of the rev/share split, I’ll be on social security by the time I get my first real check. I mean, even though you see all these Google adsense ads on my site, not many people are clicking on them and I’m not really sure why. They’re not as relevant to my content as I’d like them to be, but it’s hard to manage that, unless advertisers came to me directly.
You’d think with about 30 to 50 visitors a day to this blog, I’d be making some money with Adsense and the Amazon program, but I’m not making anything that makes a difference…not yet anyway.
I tell people all the time. The Internet is not the holy grail. You still have to know and understand your customer, provide value and excellent service. That takes time, energy, commitment and possibly an investment of capital. It is what you put into it. I don’t post enough to get a mass audience and it’s slow going. In order to make any real money on the web, you gotta hustle. Just like everything else. Get rich quick schemes only make the ones who think of them rich, and everyone else is used for their brainpower and hard work.
Remember what they say, “if it seems to good to be true, it probably is.” But then again, they also say, “if you can’t beat’em, join’em!” Take your pick!
Here’s my Google ad below…I guess I’m joining them…lol.
Barry,
You are missing the point. In my comment, I said, why don't they just charge $20 a month to use the technology, instead of $20 a month and you get the prerequisite amount of songs?
My point is this: the artificial inflation of sales of music can be a detriment, not a benefit to a lot of people. If you understand the music business, and put aside your MLM arguments for a minute, you'll see my point a little clearer.
If people want to spend that $20 a month to run their store–like rent–to me, tht's fine. I pay $200 and at times $250, depdending on bandwidth, to Live365.com to run my online radio station every month. That money is split between Live365 and some goes to ASCAP and BMI to pay the artists that I play on the station. What I program has no bearing on what I pay to Live365. The subsequent playlist that is generated can potentially HELP labels understand what records are being played and why, without a cash payment affecting the outcome. This can help them in their marketing efforts, so they can decide to target their efforts accordingly instead of wondering what the real truth is in sales or spins of their music. One thing affects the other. So, if BurnLoungers keep selling all this music to each other and it's not being sold to listen to it, but just as a way to prop up the MLM, then that to me is the wrong reason to be in the business of selling music.
With BurnLounge, if all BurnLoungers HAVE TO BUY MUSIC each month to keep their stores open, these are sales that, on average, probably would NOT have happened otherwise. In my opinion, this artifically inflates the sales numbers at BurnLounge and makes the company do better than it would if it did not have that requirment.
Wall Street would look at this as an inherent risk, not a benefit, because the artificial inflation of sales for the purpose of propping up the MLM can backfire on itself when people tire of paying the money. If I'm an investor, I want to invest in a company that can sell things to the public, not to my own employees, because that pool can only grow so much before it starts to decline, given the $400 + entry fee and $20 a month that it costs to keep involved. For that money, I can just buy an iPod Shuffle and SAVE money every month, instead of giving MORE to BurnLounge to prop up the MLM.
There are going to be labels who think, "gee, I'm doing so well on BurnLounge," when the reality is, people are buying tracks not to listen to them, but simply just because they have to, to keep in the game.
What does this do? It deflates the artistic merit of the music that's being sold, undermines music sales altogether and continues to keep music so cheap, that it's now just a commodity, instead of a valued piece of art.
If this is all about making money to you, then good luck. I'm about quality over quantity. I'm about adhering to some kind of responsibility to the marketplace. I'm about trying to maintain artistic integrity while making a profit. That's the path I've chosen in life.
Do I download music for free? I have, but I also support dance music by buying all my mix show tracks from Beatport.com. I think I've spent about $300 to $400 dollars so far. But I can write that off as a cost of doing business, where most people can't. So I have that inhernet advantage.
Most of the tracks I've downloaded that are classic club tracks aren't even available online right now, so you're forced to get them for free. But I see the value in buying them again for a reasonable price, because they are encoded correctly and I get them at a higher bitrate, a lot faster than I would find them through a p2p.
That being said, I'm not going to preach here that I'm so perfect, because I'm not. At the end of the day though, I still call for BurnLounge to be more open about its business practices on its web site, instead of saying things like "does not work with Apple operating systems."
Say what you really mean…DOES NOT WORK WITH THE 70 MILLION IPODS OUT THERE IN THE MARKETPLACE TODAY. Say, you have to BUY $20 worht of music A MONTH to stay in the game, EVEN IF YOU DON'T REALLY WANT IT OR NEED IT. And tell the record labels, that's what you're doing, so they know not to take the sales numbers as seriously as they do with iTunes or other services.
iTunes sells to the public. Those are real sales figures that, although may not be 100% accurate, are probably numbers I can trust better than sales figures for BurnLounge, knowing what I know today. What would I rather plot my artist marketing campaign around? iTunes first, BurnLounge last.
To answer your question, they probably can't point the money toward the technology, there has to be a product to be legal. And the music is the first of what will be many products.
As you said, it's a matter of different opinions, and I think you're wrong. Sales are sales. The moguls are doing it with the full understanding that they're making each other money. If you're telling me that you wouldn't GLADLY continue to spend that $20 to make multitudes of that amount back, then why are we even discussing this with each other…
I know what you're saying regarding the artistic side of it, but they're not just in it for the social experience either. When you can show me that they're turning down the checks that come from this company, then I'll agree with you. My guess is given the option, they'll take the money. And the big, tycoon music companies, do you REALLY think they'll look down on a company that's got people all over the country, and soon the world, buying music where they maybe weren't before? REALLY??? So, they don't want the already thousands of credit card holding new customers?
Believe it, don't believe it – whatever, but I really think that this will get to the point where there are 1,000,000 moguls in it. I wouldn't be surprised AT ALL if there were 250,000 by this time next year. Now do the theoretical math – 250,000 moguls spending a minimum of $20 per month on music. That's $5 million per month in music sales, or $60 million per year, on a newer company. In one year of growing. And you think Wall Street will look down on it? Bottom line, what's it worth Wall Street? Now let's get lofty and say it reaches 1 million, (because deep down, you know it can) – that's $240 MILLION in annual sales by a company that has no hard inventory to warehouse and had to spend almost NO money on advertising because the straight commision, 1099 independent contractor moguls are doing it all for them. And the moguls are motivated to keep it going because they're making money in the process. And the problem is ——-???????????????????
Okay…here's a question for you. Once all the BurnLoungers buy the hot tracks, what's then left to buy? After a few months, the number of available tracks will trickle. Since BurnLounge only has the rights to, maybe, 3 million tracks at best (not sure).
So, after all these BurnLoungers buy their tracks initially, all of a sudden…poof! The tide shifts to new tracks, which may not satisfy the demand, and then you have people dropping out, because why spend $20 bucks on stuff you're not going to listen to. Nor can you resell it, like you could CD's.
See, my friend, the thing that bothers me the most about these conversations is the fact that, all you seem to care about, is making money. You don't seem to really care about the product itself. You don't care about the artists, you don't care about the people in these jobs, you just want to sell, sell, sell to anyone that comes your way.
Have you ever worked in a record store? Do you have a passion for music, or is this just a money making proposition for you? Because, the record stores that do well are the ones that serve their customers, that know what their customers are searching for, that differntiate themselves. BurnLounge…it's no different at the the end of the day from anyone else trying to make a buck off of people that can't see the forest from the trees.
Now, you're talking about $5 Million a month in revenues. With all those people downloading music, bandwidth costs are going to increase. You'll need customer service reps to handle all the inquiries, you'll have all kinds of additional costs when you're doing that much traffic. Right now, you're at 20K to 30k BurnLoungers. This is the number I've been hearing bandied about, but it could be quite inaccurate.
Having run Internet companies, I know the costs associated with scaling up, and bro…$5 Mil a month gets chewed up pretty quick when you have to serve 250,000 people. (That's if they ever reach that many people). After splitting all the revenues, there's not much left, at the end of the day. So, they diversify into other products. Big deal. Let's see them compete with Amazon on books…ha! That's laughable. Let's see them compete with Ticketmaster on tix, that's even funnier.
See, that's another thing. Half the BurnLoungers you talk to, know absolutely nothing about business. Better yet, they have no clue as to the costs of doing business. From the legal costs, to rent, bandwidth, content licensing, etc…, there is more than meets the eye. Also, you're talking international. Do you know the costs involved going overseas. If they don't understand how to do business here, what makes you think they are going to be successful in China, if China even lets them do business in China.
So, your number don't impress me, they only make me feel sad for the people who are burning so much cash, for something that might be abandoned sooner, rather than later.
What can I say, you just don't understand it, and I apparently cannot come up with the right way to get you to. It's like I say one thing, and you respond in another. I claim that 1 + 1 = 2, and you say it's actually green, not red.
I can say a million times that other products are going to be introduced, and you cannot get away from whether I care about the artists or not (the ones who will be getting paid, as we've already discussed). And by the way, I was at a meeting tonite where 2 poeple were saying the same EXACT things you've been about the MLM part and the not caring about the music part and the "forced" $20 per month part, and after I explained it to them the SAME way I have to you, they understood. So I dunno what to tell ya. You must just not be meant to get it.
You brush off the ticket part because you absolutely refuse to grasp the fact that if the ticket prices come in at the same as what Ticket Master charges, that there's NO WAY that people will buy anywhere but thru their own sites because they're GENERATING COMMISSIONS FOR EACH OTHER TONY!!! Ticket Master will feel a major sting it this gets real big and tickets are offered thru it. Fine, don't believe me.
Feel free to stay in the passion of the guy in the record store thing you said, you obviously don't care much about making any kind of big money in the music business, which is fine of course – I'd rather look at it from the standpoint of the people who run the record company who also understand the financial potential of the business. It doesn't make you right, and it doesn't make me wrong – it just makes a difference in opinion and desires.
Barry:
Believe me, I totally understand. My friend, I work in the digital music industry as VP of Music at StarStyle.com. And, I study Digital Communications and Media at the night program at NYU. I'm not blind, my friend. I see the financial potential, but I also understand the business AND legal issues around what BurnLounge claims to be doing. You, being on the outside looking in, probably do not have a clear understanding of the costs invloved running a digital music service.
I think you forget that after payroll, taxes, legal, hosting and streaming fees (bandwidth), licensing payments to LoudEye to carry the titles, revenue splits, customer service, product development costs and other incrementals, when you BurnLoungers talk about making all this money, there's no realism. You're like George Bush saying we're gonna win this war and stay the course, when reality says something else, because you don't want to look at the situation on the ground.
It's not me that doesn't understand the dynamics and profit structure of the business, it's all you BurnLoungers who throw these half-assed multi-million dollar numbers around without being realistic. That, my friend, is fraud.
If you tell me BurnLounge can make $5 Million a month, but then leave out the fact that there are the inherent costs of doing business, you're not telling the whole story.
So, go get yourself a business background, then come back to me and argue numbers.
Let's address your ticketing service through BurnLounge. First, BurnLounge is PARTNERING with Ticketmaster. Do you really think that Ticketmaster is going to give BurnLoungers first crack at certain blocks of tix? And, half the time, Tix are sold out for most shows within hours from phone orders, people waiting on the street, and Ticketmaster itself. I think that there will be many people who will be frustrated and unable to purchase tix through BurnLounge, unless certain blocks per show are reserved and farmed out to BurnLounge stores.
Now, my friend, if there are only 6,000 seats avail for a show, and there are 500 BurnLoungers in a market that sell 500 pairs, that's 1,000 tix on one night split by 500 BurnLoungers. I don't see serious revenues being generated. There are a lot less tickets available than there is music.
To me, you're just hyping another feature of BurnLounge that you think it going to make you rich. What about all your costs of marketing? Your cell phone? Your connection to the web? Any marketing materials that you create? Drinks you buy for other people? Dinners? There are costs of doing business, my friend, that you don't want to seem to address?
Why not?
Because, maybe you just don't get it. Money flows in, and money flows out. Maybe it's you who doesn't understand how to make money, not me.
And yes, I will stay in the passion of the guy in the record store, because at least he knew something about the artists he loved and sold to the stores customers, who came to him for advice and to learn, and not to just hand over their money with little to show for it.
To your final comment, you seem to have no clue as to how the record business works, so if you think you're looking at it from a label perspective, maybe you should visit a label one day and ask them what they think. Yes, they want to sell records, but artists are also concerned about WHO buys their music, because music should also help them sell tickets and merchandise. There is much MORE to the music business than just selling CDs to everyone you can. You want to make sure you sell them to the right people, to get the buzz going, so you can capture the long tail of music discovery. I don't want people buying my music that are just going to sit on it. That's not going to develop any fan loyalty and build my business. Sure it puts money in my pocket initially, but how long will that last? Additionally, what if people then only buy what's on the homepages of BurnLoungers sites when they need to make that 20 purchase? All the other artists in the database lose because there's no incentive to look for them. That means, only the top artists win, giving major labels more money, and killing the indy artist.
Finally, I think SnoCap MySpace will destroy the BurnLounge model. That's my bet. Can't wait til it happens.
Tony
When thse other products are introduced – will B.L.s have to buy them as well to stay in. – If ten people worked in a record store (call them 1 – 10). what if in order to get the job they had to pay $400 dollars. and in order to stay employed there they hade to buy $20 dollars of music a month. At the end of each month the will share the money that is generated. #1 will get the money at the end of month 1, #2 gets the money at the end of month 2 and so on. Or in the case if B.L. – we split a percentage of the money we make at the end of the month or whatever time period they put on getting paid. PYRIMAD!
Again I simplified. At the same time im convincine people I meet to pay $400 to work in the store and buy $20 dollars of music per month.
I think this is a very clever juk. They are creating Frankenstein monsters. These people are a combination of sellers and buyers. They sell to themselves.
Brilliant!
You continue to not get it, which baffles me.
There are no plans to make the monthly obligation be higher than $20, regardless if the products introduced.
We don't HAVE to pay anything – we WANT to because we're making each other money – it's that simple.
I've been reading this thread for three days now in my spare time (from the very beginning to the most recent exchange.) I know a little about music because I worked for a record label for two years. I also know one the early investors in BL. So I'm somewhat informed. Personally I don't think the model holds but that's just my opinion.
What just dawned on me with the $20 per mo. music purchasing thing… it reminds me an awful lot of the dot com bubble when two sites or telecom companies would exchange services and instead of accounting for them properly, they'd both add the gross number to their revenue lines.
BL's (Barry in particular) seem to be saying "who cares as long as we're all making commissions?" The problem is that the company isn't generating any real sales. They've got a subscription plan for people that want to run around and tell everyone else how rich they're going to be in a year.
Further, all of these media people that are involved… which are the ones that made a killing by identifying great investments? Does anyone know what kind of consideration they were given for the use of their names? Not a single one of the "moguls" are equity owners. They own absolutely nothing here. If BL were to close its doors, they'd all be completely SOL. Some of these celebs were likely given equity for free. If BL closes, whatever is left, the equity holders will get a cut.
Cadillac and Pepsi: Yeah you recognize their names. Any idea what their advertising budgets are for a year? How many places they put their logos? Did they even pay? Cadillac probably put up an Escalade for a contest and in exchange got free advertising on BL for a year. What do you think an Escalade costs? 60k? Wow! Huge spend for Cadillac there, eh? That definitely validates BL. If BL closes up, Caddy probably gets their Escalade back.
On a side note, I've been looking at a content company that has an exclusive distribution deal with itunes. They are the sole supplier of their niche content to the ITMS. The exclusivity runs through 2010. Even with this kind of competitive advantage… I STILL don't know if it's a good investment. Without that 70%, it's an ugly space to compete in. No one in their right mind that owns an iPod would buy from BL. It's as simple as that and it was my very first argument against making the investment in BL when I saw the B-Plan.
Do the math… it's not pretty for the challengers. On the hardware side, it's virtually impossible to compete with the iPod because Apple has scale. On the software side, a company has to compete with the combined interfaces of the iPod and iTunes. The only thing left to compete on is features. Unfortunately there aren't many "features" the iPod is lacking. DRM-crippled wireless sharing doesn't really qualify in my book as a deal-making "feature" (referring to the Zune). That being said Microsoft (as is their way) will dump 10s if not 100s of millions into marketing for the Zune and their new store. Now there are two 800-lb gorillas in the space.
To the people that think they could be the next Seymour Stein or Chris Blackwell, I have only one question. Why would an unsigned band whore themselves out to you on BL rather than just sign themselves up? Why BL instead of MySpace? I think this was alluded to but MySpace plans on rolling out an ecommerce system that allows unsigned talent to monetize their work. It could easily be the death knell for Indie labels. What drives great content (and this is something that Tony is clearly aware of and the BL's are seriously lacking) is passion.
Everyone thinks Music and Movies (Entertainment in general) is sexy. Everyone wants to be in the business. What so few understand is its a BRUTAL business. Especially so since Napster. It's virtually IMPOSSIBLE to make money. The people that stick it out in this game are the ones with a passion for quality content. Period. Every major is running around trying to figure out how to put the genie back in the bottle. Of course you can't, but that fact doesn't help margins for anyone. BL (along with all the rest of the content providers) is essentially competeing with FREE product. Margins will continue to erode until some of this capacity dissapears. The only one that is even close is Apple because of their scale.
You can talk line extensions all you want but I doubt any of this ever goes anywhere. If BL were doing that well they would be shouting their milestones from the rooftops. All I've heard is people don't like them and they spent a lot of money on a Grammy party that no one even knows they threw.
(Seems to have turned into a rant somewhere in the middle, sorry bout that.) Best of luck to all of you that are involved!
Macstibs:
Thanks for your insightful commentary.
I agree with what you said about "people that think they could be the next Seymour Stein or Chris Blackwell." I've lived my life in and around the music business since I purchased my first 12", "Ain't No Stoppin Us Now" by McFadden and Whitehead, from Strawberries Records and Tapes on Memorial Drive in Cambridge, MA in 1979. It takes an incredible amount of passion, energy and commitment to succeed in this business.
Having literally put my blood, sweat and tears into my career, I always find it fascinating for newcomers who jump into the music industry who think they are going to become millionaires overnight.
Granted, it's the rare talent or idea that comes along that shakes up the industry, and those who control it first, are usually, far and away, the leaders for years to follow. Those strangleholds can be broken, i.e. Apple (downloads), Best Buy (music as a loss leader), etc.., but it's few and far between.
For anyone who thinks that BurnLounge is the holy grail of music services, they're either to naive or simply just too inexperienced to know the differnce between a legitmate record retailer and a company that is perpetuating the inevitable flameout.
I'm glad you brought up the point about two companies booking revenue against each other. I had said that in so many words in a previous post about BurnLoungers buying from each other. With a limited offering, after the number of BurnLoungers who are Moguls have purchased all the music they need, then what? What happens next? What's left to buy for $20 a month? And, how many people in this country have $600+ a year to spend on donwloadable music? The concept hits an invetiable wall once you run out of people who can afford to get in, or people who even care to get in (not everyone in this country cares about music).
Whenever I talk to someone, they've usually spent about $50 to $100 this year on downloads. That's an informal survey, but it's indicative of what's going on in downloading overall. There are still a large number of people purchasing CD's. Downloading legally has not yet reached a tipping point.
The music business is BRUTAL. You should see what I go through everyday. Labels want your licensing money, but there aren't enough people to service your account. I try to reach out to label marketing reps all the time. They only have enough people to handle projects with the major portals, and they're not paying any attention to the "long tail," despite the popularity of Wired Editor, Chris Anderson's recent book that tells them that's where the action can be as well.
People forget that once you get into the business of music, then other people must purchase that music in order for you to survive. There is a huge risk involved, because not every song appeals to every person. And, the hits today sell a lot less out front, than they did in the past.
I think the recent Diddy release did somewhere in the 150K range first week. That's down a few from his highest first week seller, which was 180K or so. And he probably spent more this time in marketing to sell a little bit less.
Another thing BurnLoungers forget is that you must market your BurnLounge site. So, you start to incur costs. Sure the top guys are getting PAID, cause they got in first. But the bottom feeders? They're gonna turn on you when the going gets tough, and how do you keep them happy?
The other point I agree with you on are all these celebrity moguls. No one knows the terms of the deals they structured with these celebs to use their names. Like you, I think they just gave away BurnLounge stores to the celebs to get them involved, so they could use their names in their marketing literatue. It's a cheap ploy that anyone can see right through…oh wait…almost anyone, sorry. There are a few BurnLoungers out there who think these celebrtity tie-ins are the confirmation that their is gold in'dem'dar hills, boyeeee!
How those actually familliar with MLM understand this so easily, yet those not familliar with it try so hard not to truly baffles me.
I feel like I'm going to repeating the is for like the 1 millionth time, but what the hell, there's nothing on TV at the monent. Maybe this millionth attempt will sink in –
1. This is MULTI LEVEL MARKETING, WHICH MEANS WE ALL HAVE PEOPLE IN OUR DOWNLINES – We do NOT have to compete for "the same customers" as Tony states. If I download something thru my own site, people 6 levels above me benefit financially. If the people up to 6 levels below me download something, it benefits all the way up to me. SO, by us simply downloading on our own, we're AUTOMATICALLY creating income streams. Tony, please tell me how may more times I'll have to esssplain that before you realize that what I'm saying makes absolute sense? Because if it's 10 more times, maybe I'll do it all in one post. There's no magic here, it's Introductory MLM 101.
2. Tony, let me repeat, again – we're not just making money from the music downloads, if that were the case, I'd be agreeing with you 1,000%, (not 100%, but an actual 1,000%). After my first 9 days in this I've made $350 in commissions because of the people that I brought in, AND because of the people who came in who were placed below me by the people above me. My credit card statement for my $444 or whatever won't be here for 2-3 more weeks and I've almost recouped my initial investment back already. And as EVERY OTHER MLM OUT THERE, this growth will begin to multiply. You obviously don't know the system or you wouldn't be saying the things you're saying. The people who understand the basic concepts of MLM could care less what iPod's doing, or what MySpace is doing, because they're not paying us to download anything, and they're not giving us credits for downloading from our own sites. AGAIN – IT'S NOT JUST ABOUT HAVING PEOPLE COME TO OUR SITES TO DOWNLOAD MUSIC –
AND AGAIN – IT'S NOT JUST ABOUT HAVING PEOPLE COME TO OUR SITES TO DOWNLOAD MUSIC –
AND AGAIN – IT'S NOT JUST ABOUT HAVING PEOPLE COME TO OUR SITES TO DOWNLOAD MUSIC –
AND AGAIN – IT'S NOT JUST ABOUT HAVING PEOPLE COME TO OUR SITES TO DOWNLOAD MUSIC –
AND AGAIN…………………………………….
2. And as I've also said about a million times, RIGHT NOW it's just music, but they're working to expand into movies, ringtones, cell phones, concert tickets, games, ebooks and more. So your thing about people running out of things to download holds ZERO water. Yes, Zero.
3. Tony, I read your earlier posts regarding the margins getting smaller and smaller the deeper it goes till the people who are X number of levels down are fighting for crumbs or whatever you said – COMPLETELY INACCURATE – and again demonstrates that you don't understand how MLM works. The download/product purchase part of this program goes 6 levels deep, something I'm pretty sure I've already stated. So if the people up to 6 levels below me are just doing the $20 minimum, and someone on what would be my 7th level downloads $1000 per month, I get no benefit from that person because he's beyond my 6th. But the people directly below me would. And speaking of MLM 101, that 6 levels of people can literally become thousands of people. Let's say that over the course of the 6 levels that the commissions balance out to 10% per level – that means that no matter how many people come in, and no matter how wide and deep it gets, that a total of 60% of the amounts spent on downloads wil be paid out in commisions. That still leaves 40% left over for expenses and royalties and whatever – THE EXACT SAME WAY THAT PRACTICALLY EVERY OTHER SUCCESSFUL MLM PROGRAM OUT THERE HAS DONE IT FOR HOW MANY YEARS NOW…
So please, stop with the running out of buyers and running of things to download already. As your initial posts very clearly demonstrate, you do NOT understand the program, and you do not really understand MLM. How can you so vehemently defend your positions regarding this program when you so obviously don't understand it? Tony you don't understand it. I know you think you do, but you don't.
As those of us versed in MLM realize, there is nothing, I repeat NOTHING that this company is doing from the MLM standpoint that's putting it at financial risk, and I'm sure I'll continue to see criticisms from those who don't kow the system. So maybe I'll keep on trying to talk sense into those who have opinions that are based on inaccuracies.
Barry:
Okay, so you made $350 back from people signing up over the last three weeks. But, your initial investment is not $444. It’s more than that.
How much time did you spend with each person. Remember, the value of time to money. How many cell phone calls did you make? Deduct the amount of time you were on your phone from your monthly bill.
Now that you are in business for yourself, what would you say a portion of your rent and the amount of time you are using your computer to do BurnLounge work? You have to add depreciation of your equipment.
Barry, I may not fully understand MLM, but I do understand business. At this point, you think you’re close to breaking even, but you still haven’t built in your costs of doing business. Did you spend any time in the car? Any money on gas? When you went to your first BurnLounge event, did you buy drinks? If you think about it that way, you might even be down more money than you think, lol.
Another thing you might want to go back and read is that I wasn’t totally against the program if they took certain steps, like clearly stating that people can’t use an iPod to play the files and clearly define terrirtories for BurnLoungers so there aren’t 60 in a nightclub trying to sell the same person on being a BurnLounger. I also don’t know if you’ve read the fine print, but you can’t create your own marketing materials either.
So, whether I understand the program or not (I could never keep track of who’s upline and downline and all that entails), the fact remains that your focus in on selling future BurnLoungers a $444 mogulship + $20 a month in fees and not on buying music or anything else from you for that matter.
Here’s my point, and listen carefully….
Why in the world would I want to spend $444 + $20 a month for a program that allows me to buy music, tickets and books when I can do all of that for free through all the web sites that I participate in.
On the sales side, with Amazon’s new E-Shop, which I’ve integrated into my web site on the Netmix homepage, I don’t have to pay anything to Amazon and I only split my commissions with Amazon, and no one else.
With my iTunes Linkshare program, I can sell all the tracks I want through through Apple/Linkshare without having to pay a dime, and I get the $.05 cents a track without having to share revenues with anyone upstream or downstream.
So, for $444 + $20 a month, basically, I’m renting out the technology that BurnLounge has created for me to not have to build it myself. I agree, there is an advantage in being able to partner with someone to use the technology, but if Amazon can build it for free, why can’t BurnLounge? Because the whole business is predicated on selling Mogul-ships, and not products.
Now, when you’re splitting $.05 cents downline with 6 people, you have to sell a lot of downloads to make any money.
You seem hell bent on telling everyone about the upside that you think is inherent, but you’re not saying anything about the downside. Why not? There’s a downside in everything we do. There’s a huge downside for me keeping this blog and streaming my mix shows. It’s costing me about $230 a month plus $30 a month or so in downloads from Beatport.com. I choose to do it with the intent that I can start selling advertising around my shows and site that will cover those costs, and the costs of my broadband connection, phone and time invested in doing this.
I’ll have to share a piece of my ad revenues with the banner ad network and Google, but the difference is, I don’t have to PAY ANYTHING to get in with Burst! or Google. They let me use their technology, then they go out and sell the ads. I don’t have to do a thing but drive traffic and keep the site updated, which is what I should be doing. I’m sharing my revenues because they are out there working to sell the advertising, NOT the potential that one day the advertisers can benefit from something if other web sites start using them, but with no traffic to speak of yet.
The difference between you and I are, I’m providing something no one else can do but me. You’re doing something 20K to 30K other people are doing, with the same songs, same tickets, same everything. And, it seems, as if no one cares about selling tickets or music, they all want to sell BurnLounge mogulships, because of the $50 commission on new sign-ups.
You’re not selling music, you’re selling the dream that someone with enough drive and motivation can use the BurnLounge tool to sell that dream to someone else, and so on and so on. You’re not building an audience of repeate customers, you’re building a vat of salespeople intent on selling more salespeople on selling more salespeople. After a while, the pool of people that will be interested in this, or can afford it, will dry up.
You fail to realize that, in the grand scheme of things, this idea is appealing to only so many people. The pool will dry up. All ideas hit a peak and then have to play in the long tail. When BurnLounge first launched, sign-ups went through the roof. All those people who were interested early got in. Now, they have to go out and sell other people, those are the second level. Then, the second level have to reach out to a third level, while competing with the first level. Then the third level have to compete with the first and second level. Pretty soon, the pickings start to get slim, because if everyone wanted to be in the music business, then we’d have millions of people in it already.
The music business is not for everyone. How many law school students will drop what they’re doing and invest in being a BurnLounger? How many doctors? How many bankers? How many financial analysts? How many Wall Street types?
Let’s not forget that this is a country of immigrants. What about all the people who don’t speak English and want music from around the world, that BurnLounge doesn’t have in their store?
Barry, there are only so many people who are going to be interested in this idea, and when the faucet turns to a trickle, like it did for Excel in the ealy 90’s, then we’ll talk.
What you keep wanted to do, is spread the gospel that this idea will grow like wildfire and everyone will benefit upstream, or whatever, but you don’t even know your market. 5 mogul sign-ups does not a business make. Go sign-up 10,000 people. Let me know what you’ve spent to do just that.
Business is built on spending money to make money. If you can honestly tell me that you’re going to go out there and get a couple of hundred people to sign-up for BurnLounge at ZERO cost to you, besides your sign-up fee, I’ll call you a liar, because no one can sell something without at least investing time, and that’s not free, at least not to me. Then, there’s the other costs involved, including cell phone, rent, computer fees, marketing, etc…
Build all that in Barry, then let me know what you really made.
Tony Z.
Hmmm…. does BL even still exist?
Why does a google search for BL only return a page full of links to a war of words on the BL business model? Shouldn't there be links to pages of BL members shouting the virtues of joining BL? Strangely absent…
Why does the BL site not respond to any of my clicks on any of the links?
Is this a moot discussion? Is BL already burned out?
Yes, BurnLounge exists at http://www.burnlounge.com. Google search results are weighted towards any web site that uses the word BurnLounge legitimately in discussion. Illegitimately would mean that someone hid the word BurnLounge in white text on their homepage 1,000 times.
What's probably happening is you're finding links to the tens of site's who have posted commentary about BurnLounge's business model, and the arguments against.
I've looked through a number of these sites and there's always a BurnLounger that will post a pro-BurnLounge comment. You just have to look hard for them.
Tony
Tony Tony Tony Tony – you've never done a single MLM program in your life, have you? So much of this would make sense to you if you simply understood how it works.
I also own a business and yes I understand the value of time, so let me answer you this way. Because I just started this (and I think I said 9 days ago, not a few weeks as you said I said), the risk/reward ratio is in its infancy. But BECAUSE IT'S MLM, there are people who are not that much over me who came in maybe 3 weeks before I did who spent no more time doing this last week than I did, but they made a couple of thousand, maybe more. And BECAUSE IT'S MLM, next week their efforts, while spending no more than they did last week, will probably mean a check that's even higher because their downline is growing. And the next week it'll likely be higher, and so on. Have I mentioned like 100 times that's how MLM works? I met a guy last week whose check was about $25000 FOR THE WEEK.
It's ironic that you brought the value of time aspect into this, mainly because the conversation I had just tonite –
Just like the attorney I met with tonite who is going to join in the morning, he said that while up front he'd be losing money thru not billing as much thru his legal practice while he's talking to people about this, the time spent is like an investment to him, because he's aware that as his downline grows, so will the income he makes from it, which, mention number 101, is how MLM works. He knows a ton of poeple in several cities, and some of those cities have hardly any reps there so the growth potential for the people in those cities is huge, so the time it takes to meet with them and get them up and running will pay big dividends in the future.
You wanna talk about successful people joining? I know people who own large, successful businesses who are coming in because they see the potential for it, and they're bringing people in with them. I'm talking about people who own large car dealerships and mortgage companies and jewelery stores and partners in law firms. I must say I'm surprised that they're doing it, but again this is the infancy of the digital age and it's just going to keep expanding, and as you're already aware, this will go beyond just music. And they want to be part of it.
Regarding your comments about bottoming out, you're right, it could happen. Of course it still hasn't happened with Amway/Quixtar yet, and how many years have they been around? 30? More? How many millions of reps do THEY have? Hell, aren't there still people MLMing Kirby Vacuum cleaners!!! And contrary to what I think it was you who said some posts ago, Amway's not offering anything that people can't go to Wal Mart to buy. If anything, going to Wal Mart would probably be easier. Matter of fact that's part of their pitch – why create a profit for the store owners by buying from them when you can create a business network of people and generate profits thru each other? They've created networks of people who are buying products and they're making money thru the MLM aspect of it so they keep coming back for more. I've asked you this question before and you've never once answered it – would you not spend $20 per month downloading from Burnlounge if you knew that it would mean getting a check from them for even $100? What happens if the check is 10 or 20 times that amount? Tony, if you don't understand MLM, then you don't know how to answer. There are people in Amway today who are making millions of dollars per year simply because it's MLM and the network below them has grown to be huge over the years. And with the digital age expanding the way it is, there's no reason to think that it can't happen here too.
If buying concert tickets thru your Burnlounge site earned you free VIP passes to said concerts, would you buy from Burnlounge, or would you still buy from Ticket Master if the prices were the same? Sorry, what'd you say?
If downloading from your Burnlounge earned you something on the order of mileage credits, would you still go to Napster or whoever if the prices were the same?
Gimme a break with the non-English speaking people thing. What if Martians come to earth who don't have ears and only communicate thru super sensory perception? I may as well bail now, right?
And by the way, if this gets licensed to be marketed overseas, now there are literally millions of more people who are going to hear about it.
I'm just going to keep telling you over and over and over again – you do not understand MLM.
I'm going to keep telling you over and over again that you know nothing about consumer demand for entertainment products in the marketplace today.
Granted, your passion and enthusiasm to protect your investment is admirable, and I appreciate your belief in BurnLounge, but you sill haven't addressed any of my points with a believable and factual answer.
Who are all these people you speak about making thousands? Who are all these car dealers and finanical people? Let's see their BurnLounge statements posted to a web site, so we can all see how it works.
As to whether I would purchase files from BurnLounge for $20 a month if I could get checks for $100 a month in return. That's only if I bought a BurnLounge mogulship and went out and sold other people on buying them. I have to do more than just buy music to get that check. Me, I have enough to do and am not willing to do that. I would also have to trust in or hope that the people I sold to buy their $20 a month. And they may end up cancelling or having some other problem that would prevent me from collecting monies due.
Here's the other problem: I own an iPod and a Mac. I don't need to download from BurnLounge. As a matter of fact, I don't download much from iTunes either. I use Beatport for my dance tracks, because the other service don't, won't or can't carry that music.
There are clear differences between Amway and BurnLounge. First, people need home products, they don't necessarily need music. And, the margins on Amway products are probably much greater than the margins on music.
It's not that I don't understand MLM as much as you think I don't, it's that I don't believe in some of the business practices of BurnLounge. But you still haven't addressed those issues that I've pointed out in my past writings.
As far as everyone buying concert tickets and books from each other instead of from Amazon or Ticketmaster, the margins are so slim and the competition to buy those items from other companies is so real, that to scale the business beyond 20K to 50K to 100K, the number of people who get in, I think, will be problematic.
You can talk about licensing overseas, but obviously, you don't know much about licensing. You'd have to pay to play in every market you enter. The costs would be enormous.
Anyway…thanks for all your enthusiasm, but you really don't want to see anything but your own investment grow. That's what I take from all your musings. I don't see anything related to caring about music or understanding music marketing. All I hear you talk about is how much money you can make. That, my friend, will be your downfall. Just my opinion.
Tony Z.
I'm gonna put this in here first because I think you just skim thru my postings without reading everything, so this way you won't miss it –
http://www.soundtaxi.info – so much for the iPod issue……..
I respond to everything you say, you're apparently just not fully reading it.
Who are these people? They're people I know personally and have for some time. Why don't they show their statements? That's their business, but I can say that in the near future I'll be posting mine, showing the weekly progression.
I DO understand the demand for consumer products, but you DON'T understand how that demand translates to MLM. You think people are buying their soap from Amway because they need soap? Tony that ain't it – they're buying their soap from Amway because they've turned buying their soap from Amway into a business by getting others to do the same. And this will work the same way.
Is it JUST about the music for me? No, it's not. It's about the obvious growth of the digital age and taking advantage of an opportunity to become an integral part of it vs. just staying a customer and letting some big corporation make the money. And as I've said here over and over again, there will be more products available, and every time something new gets introduced it will open up to a whole new segment of the market in this country. Just wait and see.
SounTaxi.info…nice. Let's go out and tell music fans to first, buy your iPod. Then, sign-up as a BurnLounge mogul for $444 + $20 a month. And then, go to SoundTaxi.info to spend $14.95 to convert your files. And after that, spend all your time figuring out which files you want to download, which one's you need to convert, and use iTunes to play them on your desktop anyway, since it the program is free.
That's how I want to spend my Sunday afternoons, playing with technology that should just download and work. But no, you're saying I should go and do something else to get my files to work on my computer and iPod.
How about this? I just go out and get a $79 iPod Shuffle, I download the same music from iTunes I can get on BurnLounge, and just walk away happy as a bee!
Of course, you'll argue…what are you doing giving money to that big fat Apple Corp. and padding their bottom line?
My response would be that BurnLounge is a corporation too. They're in it for the same reason Apple is. At least they provide a technology solution while BurnLounge is just ridingon the coattails of the digital revolution.
Finally, there are more people that buy soap then music, and Amway doesn't sell just soap. People need soap. People want music. There's a huge difference in the demand for soap over music. I don't see how your argument is relative.
I don't know much about Amway, but I'm sure there are some things that clearly differentiate the company from BurnLounge.
Finally, if you want to take advantage of the digital age, then go create something new and exciting on your own, instead of riding the coattails of some company who don't provide the appropriate level of customer support, who hide details in the fine print, and who have set up this pyramid with the intention of selling moguls and not music.
A big corporation is taking your money. When a company incorporates, they then become a corporation, with the intent of making a profit. What's so different from BurnLounge then from Apple or Microsoft when it comes down to the legal papers?
Say BurnLounge begins to make $100 Million a year. Then what? Is it not a profitable corporation? So, what do you do? Are you going to quit? Don't give that BS about giving money to "the man." We all work for corporations, big and small. And, they are all in it to profit from you, me and everyone else for that matter. Here, you are saying you want to make money, but yet you can't see giving money to big corporations. Well, let's find out who some of the investors are in BurnLounge, and find out who you're giving money to.
You want to become part of the digital revolution, then devote your life to it, like I did. I'm not going to get into my contribution, but it's pretty obvious if you look hard enough. I've been doing this for 12-years. You, a few months. I wish you the best of luck if you think that you're investment is going to make you wealthy. I'm not so sure it is.
Me, I've invested in myself by going to school and living the school of hard knocks. I've learned that there's no easy path, and there are always obstacles in your way. You're on the outside looking in. Me, I'm on the inside looking out. You want to get in because you missed the boat the first time around. Well, look hard enough, and you're still on the shore, while I'm out at sea, waving to you!
Tony Z.
Ya know, I KNEW you would take a negative tone to my last post. But that's just how some people are. You seem to not be able to only focus on the negative side of whatever's said regarding this.
Of course Burnlounge wants to make money, just like Apple does. But what the companies like Burnlounge understand is that, or should I say companies that have the brains and common business sense to create an MLM structure so as to get thousands (or maybe millions) of independent contractor distributors working on their behalf, is that even if they pay the majority of the commisions back to the field force, they'll still make TONS of profits. If and when Burnlounge is making $100 million per year, it'll be because it's moguls are making MUCH more. And granted, some will makeing scraps while others make tons, but that's just the way it is in any business. This is not a get rich quick by any means, there will be people who come in a year from now who will completely outshine ones who came in 6 months ago. But again your misunderstanding of anything MLM will prevent you from understanding that. You just don't understand it – period.
To start off from scratch like you suggest when a successful program has been already assembled, is in my opinion ridiculous. But that's jsut my opinion. It's very apparent that you have a personal grudge against this company and what they're doing, but you watch and see the accolades is receives over time.
Me, focus on the negative side? Please. What I'm focusing on is to find out the truth, instead of the one-sided stories I get from BurnLounger's trying to prop up the company in the blogosphere so they don't lose their investment.
Now, to address your comments about Apple, or any other company that has an "affiliate program." Isn't that a sort of MLM, but without anyone having to buy in with an upfront fee? I'm sure Apple, Amazon and a hundred other web companies have affiliate programs, but many of them do not charge a fee to get in to use the technology. So, companies like BurnLounge come along and build a pyramid of glass that can shatter at any moment, unless the flock continue to believe in the power of their brothers and sitsters.
Your opinion that building your own business is ridiculous over joining someone else's business a year after it's already started? I'd rather be an owner, my friend, than just some schmuck paying in with no options to purchase stock in the business.
If BurnLounge is such a great idea and everyone is a so-called partner in the business, where is the stock option agreement?
On the web, all people see are the negatives…when are the accolades coming? You tell me? I haven't seen any yet.
Tony Z.
That "propping up" thing – that's called SALES Tony. Apparently you don't like the sales process either.
Calling any company that simply has an affiliate program similar to MLM just further proves your absolute lack of knowledge of anything MLM. You may in fact know less about the MLM industry than anyone I've ever met. Which like it or not is a big part of why you don't like Burnlounge – because you simply do not unsderstand it. Just like the other complainers you mentioned, who by the way seem to be limited to blogs. All these people calling it "another pyramid scheme" and so on are simply clueless to the MLM industry. They don't even know the definition of a pyramid scheme in the first place.
Regarding your 'pyramid of glass' comment – if it's true for Burnlounge, then it's true for EVERY MLM company out there. So again, your lack of understanding comes thru. You just don't get it. I was told that Donald Trump has a book out stating that his earlier opinion of the MLM industry was incorrect, that people now SHOULD embrace it. But, go ahead and ignore him too.
Wait till the time comes when that Burnlounge becomes the largest source in the country for music downloads – you'll still be saying that the sales are inflated. And all of the musicians amd music companies will look at you like you've lost it.
Yeah, sales to each other. Not sales to the general pubic. I'm glad I don't know much about the MLM business, because it's less about selling a product than it is about selling each other distributorships.
Whereas many MLM companies make their own products for distirubtion through their representatives, BurnLounge doesn't make its own product–musicians do. When they get SnoCap / MySpace…BurnLounge is going to be greatly impacted.
I get it a lot more than you think. And, of course you would reference Donald Trump, the ultimate me-too marketer. If you buy into Donald, then one can see that you're a follower, not a leader. I don't buy into what Donald Trump says. The guy grew up on his daddy's dime. And you think he's an American success story? Ha! Where's his reality show now? Not in prime time baby, because you can only market so much until people aren't interested in the hard sell any more.
Bringing up Trump just goes to show that you'll listen to anyone that writes a book, launches a TV show or builds a web site to give you the secret to unlocking you earning potential. I suppose you purchased Tony Robbins books as well.
While you're giving these people money, that's less money you spend on investing in your own business.
Go build your own business bro, and you'll find out the hard way what it really takes. From where I sit, it seems like you don't have a clue to what really goes into running a digital media company. You have no idea of the costs involved, the legal challengs or the technology. All you want to do, is sell people on a dream.
You can keep responding with your justifications and strong avoidance to answering the real questions with real answeres. You can keep trying to convince everyone here that you're right and everyone else is wrong. You can keep trying to tell me that I don't understand MLM. You can keep trying to prop-up your investment. At the end of the day, you own nothing, you're dependent on the pyramid, and you've bought into someone else's dream, instead of your own.
Netmix…that's mine. I launched in 12-years ago. I was THE FIRST person in the online space to put Oakenfold, Van Helden and Little Louie Vega online. I was the first person in the history of the music business to charge Sony Music for marketing their artists by purchasing advertorial on a web site. And now, I'm the first person in the history of the music business to build a music/fashion application that allows fans to buy what they see in music videos.
You're the 20,000 person to have a BurnLounge store.
What does that say about you? That you'll take little risk to make a couple of dollars, and you have no ownership in the concept.
My situation, on the other hand, puts me in an ownership position in all my companies. It's backed with a 3-years in the Digital Media Management program at New York University, one of the nation's best universities.
That's the difference between you and I. I'm an owner, you're just an employee in something that you have no control over.
Keep spending those dollars. Keep investing in the dream. No one here is going to convince you any different, so we all wish you the best of luck in your BurnLounge experience. Can't wait to see how you're doing, this time next year.
Tony Z.
Tony lemme put this in the right perspective so as to maybe shed some light in your brain as to where I'm coming from – – –
I understand the difference between owning your own business and working for someone else. I've owned my own business, an insurance agency, since 1993. I started it from scratch. My first 6 years in the insurance business was working for a single insurance company and I learned the really, really hard way that the only people that insurance company executives care about less than their policyholders, is their agents. So I opened my own independent agency and have never regretted a single day of the decision. As I considered the move, I was told by my manager that "nobody has ever left here and made it", which was absolute, 100% BS. The guy who told me that bolted and opened HIS own agency as soon as his renewals were vested, which was a few years later. So, I understand the differences better than you can imagine.
Because of owning my own agency since 1993, I have enough renewal income coming in that I can spend time on things like Burnlounge. The part that you do not understand is that there are people all over this country with half the "smarts" that you and I have and maybe 1/10 of the balls who are making huge amounts of money simply because they got into the right MLM plan at the right time and worked their butts off in the beginning and then simply let the processes of a successful MLM run its course. The friend/client of mine who told me about Burnlounge generated $8000 in commissions in her very first 30 days – now you can glass-half-empty that all you want, 8 G's is 8 G's. And she hasn't stopped working it, nor will she. Within a few months she'll be at triple where she's at now, and there's just no arguing it. It's MLM 101 – period.
Every person I've spoken to about this is gainfully employed – either by owning their own company or because they have a full time job. I personally know a few millionaires who signed up for this because they understand the potential, people I was quite surprised to see in it. We see what you do not – which is fine of course – but as I've said before, the arguments you're making against it are based on your lack of knowledge regarding it. The number of people who got in it before me has WAY less to do with it than the small number of people who are in it in the 1.5 million population where I live. I'm talking to a guy who lives in a state where out of about 25 zip codes I checked, there was only ONE person in it Tony – ONE!!! And that's because it's still brand new to many parts of the country. I met with a guy today who looked in his part of the state where he lives, there were NONE Tony – NONE!!! If these 2 sign up and run with it, the sky's the limit – and they'll be part of my downline, which benefits me too. If you do not understand the potential in that, then I'm tellin ya, you need to get your head examined.
For the record, I have never been a Tony Robbins fan, but for you to discount him, and therefore what he does for the people who DO believe in him, the lives he's improved – that says a LOT about you as a person. Ya know, just because something's "not your thing", it doesn't make it stupid or a waste of time. You seem to carry a lot of pessimism and negativity for anything outside of "your thing" and I'll bet that it's seeped into your own success too.
Regarding Trump, same thing – just discount the things he's accomplished because he started off with Daddy's money. There are a lot of people in this country who started off with Daddy's money who are flat broke today. And, The Apprentice was a huge success in its first 2 seasons – but now that it's lost popularity, you scoff at it. Again, negative negative.
You're apparent negativity and pessimism probably hurts you more than you know.
Barry,
I never said that MLM was a bad idea inherently. I'm not against MLM as a concept. What I am concerned about is an MLM that, and I'll say this for the ten thousandth time:
1. Uses only email as customer support for its retailers; no 1-800 number.
2. Deep in the fine print says that WMA files will not work with "any Apple Operating Systems." Should be clearly stated BEFORE anyone gives their credit card number.
3. No where is the profit split listed until AFTER you give your credit card number. To me, that is not giving people a real understanding of the business until after they've signed up. And, there's no "money back gurantee" if you don't like the service.
4. I don't believe in the $400+ dollar upfront payment or $20 per month purchase requirement; mainly, because that's where all the revenue comes from and not from true music sales. If I were an investor in a business, I would not want to invest in something that is being propped up by internal music sales.
So, you can keep thinking that I'm being a pessimist, but you'd be wrong, because I'm being prudent and a realist. Anything that's too good to be true usually isn't. If the company isn't going to give me that information upfront, then I feel it's hiding something that I won't find out until AFTER I join. I think that's misleading and it could very well be found to be illegal someday. I'm not saying it is, but it can border on it by not giving people access to information before they sign up for the program.
If you did that with a business plan, the SEC would be up your ass in 10 seconds and you'd be found guilty of defrauding investors, because you didn't disclose everything you needed to about the business. Maybe BurnLounge doesn't have to, I don't know. But I think they should.
I did not discount Tony Robbins. I implied that you were probably a follower of his methodologies, that's all.
As for Trump, I'm not discounting him either. What I'm saying is that he had a leg up to those you don't. It was easier for him to get where he is today, because of privilege and nepotism, than the hard work that you or I had to do.
So, you can tell my readers all you want that you think I'm negative and a pessimist, but if you lived in New York City, then you would probably be just as cautious as I am, especially given that I've gone through one dotcom bust and am hoping not to see another.
Tony Z.
My days of living in NYC are way behind me. I miss the food, but that's it. I could not be paid enough to move back there. Visits only.
Tony if you understood MLM you'd clearly see that there's nothing "too good to be true" about it. But you don't understand the pay structure. And this is not in the same category as what was the typical dot.com. In the typcial dot.com people were throwing craploads of money into internet based companies with nothing to go on but a promise of a result, one that didn't come thru. This company is working. They have a product, they have more coming, they're making money, they're paying commissions. There's no comparison.
You're perfectly free to not like the $429 sign up and $20 per month sales requirement – nobody's making you do it. But the people who are in it, and the ones who are joining are doing it freely.
I'm curious as to how many others are reading this.
Well they must be quiet people……… Well, you make sure that once all these questions have been answered and there's no more question in their minds that it's legit, that they go to my site to sign up to be moguls of their own, OK?
MLM companies typically do not have a toll free number for the reps, but I will ask why there isn't one for the customers. How's that?
First of all you've never asked me how the ticketing program is going to work. Secondly, I have no idea how the ticketing program is going to work because as I've already said, we ain't got it yet. But I promise you, as soon as it's available, I'll run right back here to tell you and "all the others"
To say that I don't back up what I'm saying with facts is purely ridiculous. Maybe you need to read a little slower because I've had to say the same things over and over again. Bet hey buddy, I'm here for ya, and if it takes repeating myself 10 times to get you to understand it, you just let me know and I'll just keep on repeating.
Lemme ask you something, since you mentioned the tickets thing. Let's say they put it together, and it works – at the same prices as say Ticket Master. What's your opinion going to be then?
What I find fascinating, Barry, is the fact you consistently skip over the issues I have raised about BurnLounge. You keep on talking about MLM pay structures and how much money people can make, but you never once address the lack of an 800 number, the fact that people have to email to get customer support. You never spell out how the ticketing program is really going to work. You never give any facts to support your position. Why is that Barry? Where's the BEEF?
To answer your question, there are a lot of people reading this. More than I could have imagined. It's a hot issue, because there are so many people who are concerned about the what I have raised here, and the fact that no one seems to want to address them.
Tony
Barry, I hate to one-up you, seeing as you're so knowledgeable about these things. But, like I'd said in one of my previous posts, BurnLounge IS WORKING WITH TICKETMASTER!
http://www.digitalmusicnews.com/results?title=Liv…
Date: august, 2006 (81406)
BurnLounge members will soon have the ability to sell Live Nation event tickets, part of a fresh alliance between the pair. BurnLounge, a distributed network that involves thousands of individual sellers, will offer its members special venue access, as well as continuous information on concerts and events. The partnership will broaden BurnLounge considerably, which has so far been focused on digital download sales. "This relationship benefits our community by getting them special access to venues and their VIP rooms, but it also provides BurnLounge with incredible visibility to thousands of concertgoers in key markets," said BurnLounge president Ryan Dadd.
For Live Nation, the BurnLounge arrangement is part of a string of deals and acquisitions. Just recently, the concert giant purchased a majority stake in Musictoday, an artist website and online services provider. That followed a $350 million purchase involving House of Blues, an acquisition that allowed Live Nation to broaden its footprint into midsize venues and clubs. For BurnLounge, the deal diversifies the portfolio of goods and services being offered, and offers a bit of legitimacy to the upstart. The story on BurnLounge is still early, though most of the revenue appears to be coming from areas outside of paid downloads, including sign-up fees. The alliance first surfaced this morning.
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So, Barry, what do you say now?
Let me say this, that even if Ticketmaster opened up ALL TICKETS to BurnLounger's to sell, Ticketmaster will still sell infinitely more because of, a. Brand Recognition, and b. they'll sell at the box office and many BurnLoungers won't move as fast, with many tickets then unavailable to the BurnLounge buyer.
It's not the cash cow you think, my friend.
Sorry to burst your bubble. Do your research instead of just thinking about how much money you're going to make. The media business is not like insurance. It's brutally competitive. I know this from experience, while you refuse to acknowledge it.
The way you bring the negative light to things is unbelieveable. Did I ever say that Burnlounge would ever TAKE ON TICKET MASTER AND DRIVE THEM INTO THE GROUND UNTIL THEY BEG TO BE BOUGHT, or did I simply say that one of the products Burnlounge was planning on bringing in was concert tickets? For God's sake Tony, stop with the drama already. You're just hell-bent on de-legitimizing this company.
I do appreciate the link though.