BurnLounge.com Launches Viral Marketing Effort in New York City

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:

Today, Reuter’s reported from MIDEM, the world’s largest music industry conference going taking place this week in Cannes, France, that with over 355 digital download stores in existence, many music industry executives are talking about the bubble bursting, afterwhich industry consolodation takesplace.

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.

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214 comments

  1. Tony Zeoli says:

    Good'ol Barry…

    It was less than ten minutes after I posted Tino's comment that Barry posted a reply. My man is on it!

    Barry, I really do love that you're so passionate about BurnLounge, and maybe you have changed some people's minds with your positioning statements.

    As far as I not understanding MLM, that's debatable.

    One thing is for sure. I checked the Alexa stats on Burnlounge and their web traffic has been steadily declining since their big announcement last Spring into early Summer. Now, I know Alexa is not a perfect measuring stick, but it certainly does provide an indicator of a site's overall popularity.

    Their page views have gone from over 2 Million a day to less than 1 Million a day in the last 6 months. So, that begs the question. With all these new BurnLoungers signing up, why is traffic dipping by more than half?

    Tony

  2. Tino says:

    Last weigh-in. The BL developers have created an ingenious MLM model in the respect that they are using a product that people are passionate about. Who gets passionate about lip gloss? There's an emotional investment like no other in the MLM field and it can be seen on this and other blogs. But, at the end of the day it is an MLM. There is no money to be made in the downloads. Signing up "moguls" is the only way to make any money – and isn't that the purpose of the whole thing? So the product becomes irrelevant. They can make as many promises as they want about new products, and they may even come out with some. But it won't matter.

    Additionally, the deck is stacked against you in the sign up process. BL has something called "Roll-Up" in their contract (terms of business on line in a PDF file). Roll-Up is the following: A signs up B, B signs up C1, C2 and C3. If B drops out, C1, C2 and C3 roll-up to A's level. What this means is that the two tiers below you flatten out to your level and the guy above you reaps the benefit. Therefore there is a continual recruiting process because of the high attrition rate.

    Am I sorry I "missed" the Amway boat? No. Am I sorry I "missed" the Mary Kay boat? No. Am I going to be sorry that I "missed" the BL boat? No. That's because an MLM is an MLM and the product becomes irrelevant to the continual recruiting process. Remember, it's about making money. If this is how you want to do it go for it and good luck.

  3. Tony Zeoli says:

    Tino

    A, B, C…too confusing for me. Hey, that rhymes!

    I'm right there with you. The amount of downloads you have to sell to break even (abougt 14,000 if you've bought the mogul package), and the fact that the Roll Up you speak of puts more power in the hands of the guy/girl who signed up mogul A, is very problematic for me.

    Thanks for your clear position and opinions on this subject. I hope it has enlightened a few people who weren't sure about what they are getting themselves into.

    Tony

  4. Barry says:

    The timing was just a random thing – I don't think I checked it before that point yesterday, maybe once in the morning.

    Ya know that's a very good question that I don't have the answer to –

  5. Barry says:

    Tino you don't understand what the roll up actually is. It's a good thing, not a bad one. The product purchase part of the program goes 6 levels below you. The roll up means that say someone 2 or 3 levels below you drops out, that spot gets refilled by the person below the one who dropped. Everyone below the person who drops out "rolls up" a notch to fill the gap. That means that you're now benefitting from someone you weren't before because he or she was on your 7th level, but is now on your 6th. It's called Compression. And everyone benefits from it if it does occur because it simply closes the gaps. It's standard MLM 101. Every legitimate MLM company incorporates that into their programs.

    Meanwhile you have Tony thanking you for a clarification that was actually inaccurate….

    Tino if you don't like MLM as a rule – hey that's your right. MLM is nothing more than people being given the ability to create their own sales forces. And EVERY company that has a sales force is also continually recruiting anyway, so what's the difference really? Well actually the difference is hugely in the favor of the MLMers, both the participants AND the company. Sorry, but there's no denying it, except by the people who don't understand it or just don't like sales in the first place.

  6. Barry says:

    Tony, in answer to your question – burnlounge.com is not the site people go to for the explanation of the plan. You can't sign up there or anything. If you go to yourburnteam.com, which is where the tutorials and so on are, the page views per viewer have gone up 29% in the last 3 months, the reach per million has gone up 14% in the last 3 months, and site the ranking has increased by 123,878 in the last 3 months…….

    Any more questions????????????????????????????

  7. Barry says:

    Tony, something I've noticed so blatently about you – if someone makes a comment that feeds your negative opinions about this company you're more than happy to oblige with commentary and gratitude, but just like above, where you posted a legitimate question about the website and I gave you the direct explanation – nothing…. Why is that?

  8. Barry says:

    So I take it that you're just not going to answer my question, that you're just going to ignore the fact that while you asked a question that you thought would add to the negative view of this company, that it failed because the answer was completely legitimate. Am I correct Tony?

  9. Tony Zeoli says:

    Barry:

    First, I've been mad busy. I was in LA for Music 2.0 last week and haven't had a spare minute until now to respond to your comment.

    My reply is that I checked your URL at Alexa.com and there are no readily available stats for that URL. It really doesn't matter to me how many people checked that URL, because that URL is mainly for BurnLounge REPS and NOT BurnLounge CUSTOMERS!

    Who cares if a whole bunch of BurnLoungers are checking their b2b site. That's no indicator of success. I'm looking for numbers on e-commerce. Real users making real transactions.

    I could care less that more and more people are signing up for BurnLounge. If that's the point, then all the people on my side are correct. The only way you can make any money is by signing up new registrants to the game, and keep building that pyramid of users rolling underneath you.

    So, it's not that I have been silent, it's just that I've been busy. Your facts don't impress me one bit. Sure, you may have somewhat explained the Roll Up scheme better than Tino, but Tino is basically talking about a variation on the same thing. When one person leaves underneath you, another moves up to take that persons place, and now you have that person and his/her people. But, what if that person only has one other person?

    This whole house of cards is just too much for me. I'd rather do business the old fashioned way. This MLM thing is just too troublesome, because you LOSE CONTROL of the MESSAGE. Your marketing is inconsistent and your product has incredibly slim margins. Not sure if you noticed this, but cell phone sales have leveled off in this country. If you're looking to make your money on telecom, look at Excel? Where are they now. Went bankrupt and then had to sell at a huge loss to another company and they're virtually non-existent now.

    Barry, no matter what you tell me about MLM, I will always fervently deny you any agreement in principle. I don't believe in it. I think it's the poor man's way of getting up and doing the hard work.

    If you think MLM is so great, then why aren't their any MLB companies in the Fortune 500? Not that I checked or anything, but I don't recall anyone ever saying there was.

    Why don't you check for me? You tell me, what PURE MLM company is CONSISTENTLY breaking billions in sales and is in the Fortune 500. I'm not talking about companies that own MLM companies as a side business. I'm talking about a pure MLM-play.

    Oh wait…I just checked the Fortune 500 list for 2006 and found Avon. They have over 5 million individual reps spanning the globe. Okay…so, I'll give you one…our of 500?

    That just goes to show that BurnLounge, with the profit margins on cell phone subs, ticket sales and music, will never have a chance to reach those lofty heights.

    Tony

  10. Barry says:

    It is absolutely, utterly amazing how you try to find the absolute worst part of everything – "what if that person only has one other person" – WHAT THE HELL DOES THAT MEAN, AND WHAT RELEVANCE DOES IT HAVE??? Oh, and of course – "and what about the people in this country who don't speak english, what about them?" WHO CARES!!! Always the negative, always the worst case. Always the littlest, the poorest, the most victimized. Gimme a break. Tony take my advice and never even try to run your own real business, your pessimism and negativity will wipe you out. I know you say you're not a pessimist – excuse me – yes, you are.

    I didn't just give a "better" explanation of the roll up than Tino did – I GAVE THE CORRECT EXPLANATION. HE WAS INCORRECT. This is not a matter of opinion, it's simple fact. When it was explained as a negative, you were perfectly willing to see it as a fault in the Burnlounge plan while neither of you even knew what it really was, but then you take my CORRECT explanation as a "different version" or whatever you said.

    Tony, the glass is half FULL, the sky is NOT falling and the world is NOT ending. Those who work harder and smarter and innovate more deserve more. Welcome to America…

  11. Barry says:

    By the way, gimme a break with your Fortune 500 comment. The #500 company had 2006 Revenues of $3.9 BILLION! So what, the companies that came in less than that are what, failures?

    I looked up several of the bigger named MLM companies and their annual revenues ranged from $500 Million to $1.6 Billion. I had them all listed out here and then this damn thing glitched when I hit Submit and the message was erased. And I don't feel like listing them again. So I guess if a company only does say $800 Million per year it doesn't cut it in your book, huh?

    Just ridiculous.

  12. Tony Zeoli says:

    Barry:

    Okay, so your explanation is technically correct. That gives me little comfort in the overall scheme of things.

    Let me break it down for you. I've run a company that I sold for $3 Million in 2000. I'm VP of Music at Entertainment Media Works. We currently have a valuation in the tens of millions and are creating a new marketplace at the intersection of fashion and music. I got to NYU two nights a week and am now a junior with a 3.59 GPA.

    If I'm so pessimistic, where's all that success come from? Me walking around telling everyone the sky is falling?

    C'mon, Barry. Just because I'm cutting your business model to shreds, because I've written business plans, understand marketing budgets, know the ins and outs of the digital music business, does not make me a naysayer.

    If BurnLounge is so popular and so innovative, where were they last week at Music 2.0? Are they going to be at Digital Media Wire at the end of February? South x Southwest? I don't see them speaking in the public realm, because someone like myself would probably get up to the mic and so totally thrash them for the way they've set this thing up, that they'd be scared to have to answer any tough questions in person. They hide behind these invitation only events where they recruit other BurnLoungers to come and drink the cool-aid.

    Barry, if someone told me that I had to sell over 14,000 songs to make up my initial investment, I'd tell you they were crazy. 14,000 songs! Today? 100 people would have to buy 140 songs each to make my money back.

    Forget about the BurnLounge sign-up fees. That's not the core part of the business. If you've just read Steve Jobs post on the Apple web site, even he knows that a very small percentage of iPod customers purchase music from the iTunes store. He uses the iTunes store as a loss leader, because people are getting their music elsewhere.

    Until DRM restrictions are removed (by the way, people are now complaining they can't play Windows DRM files on a Zune device), this is the way it's going to be for a long time.

    Barry, sorry to say, my friend, but I have a deeper understanding of the business of digital music than most. I don't see it, Barry. No matter what you tell me, the investment of capital in the BurnLounge model will not hold up under the micro percentages. There will be a bottom. It's happened to every MLM company out there. If you read the Widipedia article on Amway or do some research, you'll see for yourself. MLM businesses do not hold up over time because there is little incentive for the stakeholders. It's hard to keep a small army of people motivated wtihout paying them.

    You can argue with me until your blue in the face. I just do not agree with MLM. I don't like it. I like the, I work for you, you pay me a salary, we have a marketing plan, we exectue against that plan, people purchase the products at a marging that will get us to profitability in less than 2 years. If that doesn't happen, then there's a problem that needs to be fixed.

    Barry, I see problems in our own business. We rely on revenue sharing agreements between third parties and ourselves, but we're nimble and quick and are finding other revenue sources from licensing to b2b plays, etc… It's not an easy world out there. If it were, it would be that easy for everyone.

    You say I'm a pessimist. I'm a realist. Let's see what you're doing ten years from now.

    Tony

  13. Barry says:

    Effective this month, I've been in the insurance business for 20 years, so I've learned a few things about business too. FYI…

    If I remember correctly, the $3 million was in cash AND STOCK, is that correct? How much was in stock, and what's it worth today??? Sorry, didn't hear ya.

    I say you're a pessimist because you immediately attach to anything that's said in a negative light against this company, or any MLM company in general. You tend to shoot down, scoff at even, the things you don't agree with. And you nitpick your way into finding the negative side of most things discussed here when they're brought up in a positive way (e.g. "What is it's only one person", which was completely ridiculous, almost a desperate attempt to cling on to the negative).

    They "bottom out", huh? Amway / Quixtar has been at it for what, 25+ years now? And they're still bringing people in. And if I remember correctly, they did "a paltry" $1.6 Billion in revenues last year. Yep, seems pretty flat to me too… And look at it this way – the company you work for, it has a bottom too, right? So what's the difference? Tony, you don't know the simple difference. I've already described it, but you surely glazed right over it.

    As with EVERY other MLM, Burnlounge income partially comes from bringing new people in. That's so easy to understand, even the Cave Men get it…….. Why you so refuse to understand that it's part of the overall plan mystifies me. It's part of the deal – just get over it already. Could it "bottom out"? Maybe some day. But what if it expands outside the US? How many millions of moguls could it take in before it "bottoms"? Yes Tony, it can happen. I'm curious to see what the actual updates on version 2.0 will be. Not much longer to wait on that.

    And WHY WHY WHY do you only focus on the music when I've told you what, 1000 times now that more products are coming? What will your excuse be then?

    MLM companies don't have CLOSE to the marketing costs that the typical business has – did NYU ever bring that up?

    "Cool aid" is spelled with a K, not a C – but I digress…

  14. Tony Zeoli says:

    Barry:

    Thanks for correcting my spelling. I know I'm not the most accurate typist. In between moments of downtime is when I can post, and those are few and far between. I should strive for perfection, but sometimes it's as illusive as a BurnLounge profit! Heh, heh!

    So, you think adding more products is going to prop up BurnLounge? Remember last year, BurnLounge was revolutionizing the digital music industry? Today, you're holding out hope for the next suite of products to entice people in to becoming their own little digital media companies. You see, someone inside realized that the profit margins on music were way too slim to survive. They must have said, "uh oh, there's little growth here, the digital music market is leveling off and we're stuck with Windows DRM (baaaaad move!)–what do we do now? BurnLounge figured, hey, let's try to sell telecom services and other stuff other people have already been selling for years; in a rush to develop new products to keep the business going. Oooops! Did I let the cat out of the bag, Barry?

    We're still waiting for the new products, and they're not here. And, when they do get here, I'm wondering how many BurnLounger's are really going to be able to compete with AT&T Wireless (Cingular), Verizon, T-Mobile, Sprint, Amp'd, Helio, Virgin and more. The mobile market has already been canvassed in this country many times over. Good luck trying to move subs from one service to another!

    Barry, this country was built on critical thinking. It's supposed to be a democracy, where anyone can criticize anothers ideas. Last time I checked, there was such a thing called "free speech." I am warning the consumer and the small business owner who is interested in MLM schemes in the downside of the business. I haven't heard one person tell me that their store has made any impact on music sales.

    Why do I talk about music? A. Because that's currently what you say you're selling, B. Because I know a lot about it, and C. because I just gosh darn feel like it.

    I have the right to express my utter dissatisfaction with the BurnLounge business model, just as you have the right to defend it, but I don't question your right, however you do question mine? Now where in the book of fairness does that make sense. If you can't come up with an answer in a debate, don't point fingers at others and use the argument that I'm just a pessimist.

    Tony

  15. Barry says:

    For starters, from day 1 of my hearing about it they said that they were going to bring other products in, probably starting in the first quarter of '07. You just seem to ignore that, or maybe you just keep forgetting that it's been brought up here countless times. Well, last I checked February was still in the 1st quarter, and new stuff is coming this month. So NOTHING has changed in the message, including your insistense to ignore it and argue around it. From day 1 I've heard them say that the music will probably be the least profitable product they offer, and I've said it here countless times. You just choose to keep ignoring it. I just don't understand why.

    You're STILL saying that MLM is a "scheme", which shows a complete, utter disregard for reality. It's like you have ADD or something. Maybe it's short term memory loss. But it's definitely something. Either that, or you're doing it on purpose to get your jollies. You say that you know more about MLM than I give you credit for, yet you still call it a scheme. It's like the same bad joke over and over. I'd almost bet that without looking it up, you couldn't even name 4 MLM companies.

    You're right, the 1st Amendment clearly exists, but there's a difference between a difference in opinion and a blatently falsehoods, like MLM is a "scheme" or a pyramid. You simply don't care about the truth – that's very obvious. Even if your opinion is proven wrong, you simply don't care. There's just something wrong with that.

    Your comment about "so you think Burnlounge is going to be able to compete with AT&T and" etc. is just another example of your inherent negativity and/or pessimism. By your standards, why would ANYONE start a business of any kind if there are already competitors? Yet even with competition, businesses flourish. It must be a miracle.

    And by the way, regardless of your inability to see them, I give direct answers constantly. You just choose to continue to ignore them. Here, watch this everyone (sorry, the 4 others of you who are reading this) – Tony, are pyramids and MLM one in the same???

  16. Tony Zeoli says:

    Barry:

    How am I ignoring the new products? I've been dissing the Ticketmaster partnership and the mobile subs in many of my responses. Maybe it's you who has the selective identification problem, not I.

    The other day, I thought we were discussing traffic to Burnlounge. I say that to me, it doesn't matter how many BurnLounger's are gong to the B2B site for their info and support, what matters is traffic to the main BurnLounge.com URL, where all BurnLounger's stores live. (i.e. BurnLounge.com/mystoreurl).

    Got not response from you, did I?

    Then, I pointed out how Ticketmaster would probably allocate only a minimum amount of tickets for BurnLounger's to sell in each market, and that at the end of the day, are there really enough tickets in a market for each genre for BurnLounger's to make any real money on ticket sales?

    Got no response from you, did I?

    Finally, I pointed out how BurnLounger's will now have to compete with the major carriers and MVNO's (mobile virtual network operators who buy time on the major carriers networks). Those companies are seriously entrenched in the business of selling mobile phones. How are tens of thousands of BurnLounger's going to keep phones in stock to sell direct to consumer, who's going to service that effort and what's the enticement for someone like myself to use BurnLounge phone service? The major can't even get it right at times, and you think I'm going to call BurnLounge for support regarding my bill?

    All you talk about Barry, is the products that you can sell. All you tell people is that MLM is an excellent way of doing business. But you rarely ever give anyone any real information to go on. You're always lobbying for people to use MLM, but if you've been in the Insurance business for 20-years and are not willing, yourself, to leave the business and be a strictly MLM salesman, then how can you profess to everyone else that it's a business model that can support their lifestyle and/or family.

    Finally, MLM havs many detractors, it's not just me. The problem with MLM is that it's based on signing up new salespeople on dreams of getting rich. When an employer interviews a candidate for a new job, you rarely hear, "son, if you take this job, you can make money, you can be your own boss, you can revolutionize the world, you can change consumer behavior and with that get rich, rich, rich!" What you get are realistic expectations between the employer and the employee. Sometimes those expectations are met, and sometimes they aren't. But at the end of the day, a steady paycheck comes in to support the lifestyle of the employee. These companies have salespeople who do just fine. The remaining employees focus their efforts to support the business in all its other aspects. The team then moves as a whole, not individual sellers trying to outdo one another on the street, mixing the marketing message with hocus pocus, with little formal training.

    Barry, I don't like MLM. I just don't. Call me a naysayer, a pessimist, a pooh-pooh head…whatever. I think MLM is a shitty way of doing business. That's what I think. I have the right to think that and criticize it.

    So, what do I like? I like leadership, team building, "we are all in this together" type businesses. We support each other's efforts and we all grow together. I know that's not the perfect system either, but that's the system and paradigm I'm most comfortable with.

    At StarStyle, we are providing a service to consumers and a set of technology tools to allow other companies to take our data-feeds and build around their own content, generating revenues from click-throughs, just like Google does with its adSense program. I like that model. Here is the link online, the consumer clicks on it, we get paid from the retailer for sending that consumer to them or we get a percentage of the sale. We're offering a b2b platform where everyone is on an equal playing field. No one company is regarded higher than the other. We don't ask individuals to take money out of their own pockets and be part of some tier level system, where they are so far removed from the top that it will take them years to break even on their initial investment.

    I'm just not a fan of MLM, Barry. You can keep posting til your blue in the face and your fingers hurt. It's not my bag. So, I'll continue to criticize it as long as I'm alive.

    Tony

  17. Barry says:

    I can't address the other stuff now because I have somewhere to go in a minute, but I'm going to paste your EXACT words right here –

    "So, what do I like? I like leadership, team building, “we are all in this together” type businesses. We support each other’s efforts and we all grow together."

    TONY – THATS ***EXACTLY*** (DING DING DING DING DING DING DING!!!!!!!) WHAT MLM IS!!! DON'T YOU GET THAT??? I COULDN'T HAVE SAID IT BETTER MYSELF!!! TONY, YOU'RE MADE FOR THIS BUSINESS!!!!!

    Tony, I don't care where you've worked throughout your life, you've NEVER seen the above business concept that YOU DESCRIBED to the degree that it is in MLM programs. It's all positive people working together to achieve a common goal. And people higher up probably work HARDER to help those below them than the people below them often do.

    Tony (verklempt), I'm so proud of you, my little boy is finally growing up – I think I'm gonna cry :'-)

  18. Tino says:

    I can't help it…it's like watching a train wreck…

    After scanning through some more posts and the ridiculous contention that BL will be a huge success because other MLMs have been, hugely overestimates the product being sold. All of the successful MLMs have brand labeled products. Amway, Mary Kay, Pampered Chef etc., have products that are made for them and sold exclusively through their channel. Granted, the "odor killer" that Amway sells is probably just a relabeled Lysol can, but it is their exclusive product. BL offers something that can be bought anywhere. It's the exact same product with absolutely no BL added value. Therefore, why would anyone do business with you unless they're your friend? Any added products like the Ticket Master rouse is just another co-opted product that can be bought from 10,000 other outlets at the same price.

    After the initial excitement dies down BL will fold. This is because BL adds no value whatsoever…

  19. Barry says:

    You're obviously entitled to your opinion, and as it has a negative connotation to it I'm sure Tony will jump right on and agree with you.

    Pretty much every MLM program out there has like products elsewhere, but the reason they still continue to grow is because of the simple fact that doing them via MLM gives "regular folks" the ability to turn it into a business.

  20. Tony Zeoli says:

    Barry:

    You think I don't get it. But, you still defend MLM on every level.

    Yes, I do agree wholeheartedly with Tino. Music is not a unique product. There are multiple distribution channels for the same song. It can be purchased anywhere; itunes, msn, rhapsody, napster, yahoo launch, emusic, and of course, Burnlounge.

    One only has to look at the example of Excel Communications–the resale of widely available, cheap telecom time via MLM and its failure to envision the problems that BurnLounger's either already encounter now or will soon encounter.

    What hasn't been built into the model is the fact that once the major labels move to open mp3, there will be 10 times the number of online retailers to get your music from, diluting the pool of available buyers to BurnLoungers. Also, BurnLounge does not have a software to hardware application shifting your music to your portable device, like iTunes, Rhapsody or Napster.

    If there is a move to open format, what happens if there are price cuts to move volume? How will BurnLounge respond?

    Oh, I forgot; Barry is going to come back to us with the fact that BurnLounge will be opening up sales of other products soon. I'm not sure how many people are going to trust someone from BurnLounge to purchase a $200 to $300 ticket to a concert. Ticketmaster has built trust in its business model, and even though I could buy through a BurnLounger, I'd rather buy direct from Ticketmaster.

    Sure, BurnLounge will just be an affiliate of Ticketmaster, but why go to BurnLounge when the Ticketmaster site suits me just fine?

    Oh, and mobile phone service? Hmmmm…like I'm really going to trust a BurnLounger with my mobile phone bill.

    Here's an excerpt from Wikipedia:

    "By 2002, Excel had entered the local phone service market more aggressively than smaller competitors such as MCI's Neighborhood. However, the gross margins associated with long-distance telephone service dropped precipitously during the period from 1998 through 2003 due to the entry of numerous competitors and additional line capacity into this sector. As such, the profitability of Excel and almost every other teleccommunications firm dependent upon long-distance calling customer dropped precipitously."

  21. Barry says:

    Tony you keep knocking MLM while at the same time showing over and over again that you don't have the slightest clue as to what it's all about. Which is true for the typical MLM critic. If you had any idea what you were talking about regarding it, you wouldn't be saying the things that you do. There's actually hardly any difference between the so-called "standard" business model and MLM. And the sales structure between the 2 types is probably 98% similar. But you'll keep going on and on about how you hate MLM, and how the people at the top are lazy, and the people at the bottom are slaves and all the other nonsense that again, which proves that you have pretty much no understanding whatsosver what MLM is all about.

  22. Andrew says:

    Ego's! All important people, all of ya!

    CD sales are down because people WORKING at these companies are more interested in defending their opinion, titles and status in the music industry than figuring out a way to sell music. The "music industry" doesn't even exist the way it used to (Thank god) and it has created a forum of “important people” trying to prove yesterday’s point.

    In regards to the above, very simple. MLM's do not work. NEXT!

    "Z-LEVEL" corporate executive at http://www.Subwayrecords.com

  23. Tony Zeoli says:

    Thanks for your opinions, Andrew.

    CD sales are down for many reasons, one of which can be pointed to music executives who fear the future and don't want to release their content digitally into the marketplace without protections. Although this is a noble effort on their behalf, we've all seen how DRM causes confusion in the marketplace and consumers are no longer interested in having labels dictate to them how they should buy their music. CD's do not have copy protection, so why should digital music files? I can understand the argument for DRM, but until we have complete interoperbility, DRM just does not work and inhibits consumers for purchasing music files from services because they're never really sure where they'll play and where they won't.

    Yes, you can point to music executives who sit high up in those buildings in mid-town Manhattan, Los Angeles, Miami and Nashville, and ask them what they're doing to change the game. I've been in those buildings and at those meetings, and believe me, they're all trying to figure it out now, because people are getting tired of the lawsuits and negative press, which is holding back the music industry from its next great era.

    Tony Z.

  24. Barry says:

    Andrew to say that "MLM's do not work" is outright ignorant. There's just no other way to respond to you regarding that. There are SO many people in this country making great livings doing MLM that maybe you just need to stick to your day job and not think about it anymore.

  25. Tony Zeoli says:

    http://www.burnwithshaq.com doesn't even show up on the Alexa radar.

    Yay! Shaq has a Burnlounge store. Big deal!

    If I'm BurnLounge, I go out and create a few stores with some celebrities to make it look like I've signed some big deals, but at the end of the day, is anyone buying from those stores?

    My friend, anyone can have a store. Because there's not transparency, no one knows how those stores are doing.

    If you think Shaq having a BurnLounge store impresses me, you haven't learned a thing from our debate.

    Bottom line: I could care less that Shaq has a store. It doesn't convince me one bit that BurnLounge has a good business model.

    Tony Z.

  26. Barry says:

    Tony it's NOT the fact that Shaq has a store….. It figures that's all you got out of that – Considering your tendency to mock anything you don't understand, I'm not even going to explain it… Why waste my time.

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