Burnlounge: Behind the Music

We finally got our new “Make it Rich” scheme, and it is called Burnlounge. According to Burnlounge.com, “Burnlounge is the world’s first community-based digital download service.” Basically Burnlounge is like an iTunes, except instead of having one store selling music, there are thousands of different stores, all selling the same music. For a fee, someone will be able to open up his/her music store and start making a profit selling music. But, it even gets better! If a person signs someone else, he/she earns a bonus. Also, a person earns profit from people that person signs up, and music sales from people below them. So in simple terms: it is a pyramid scheme or more specifically a Mutli-Level Marketing, MLM.

So how is this considered legal? Because there is a product involved, the music. The music is the backbone in making this little scheme look legitimate. Hypothetically, someone could make a successful business selling music on its store’s website. However, the problem comes with finding your customers. Who will actually buy your music? For one thing, every store sells the exact product, or in economic terms it is a perfect competition. Are you going to be able to persuade some Joe to buy Ashlee Simpson at your store when he could choose to buy it at one of the other 35,000 plus stores on Burnlounge? Not likely. This does not even include the iTunes factor. Most people buy from iTunes directly because songs can go directly to their ipods. As of now, the music from Burnlounge is not formatted to go on an ipod. And both products are 99 cents. That leaves a “really” tough decision for the consumer. In the age where ipods dominate, music not formatted for ipods are as useless as a winter jacket in Miami. So who are your customers? Most likely friends and families, and you the owner.

So where does the money come from? Signing up other people. Your revenue comes from getting other people to fall for this scheme, and then these people to get other people to fall for the scheme. So in reality you really are never selling music. You are selling these “stores” to other people looking to make an easy profit. According to the definition Multi-Level Marketing, a MLM is only legit when commissions are earned only on sales of the company's products. No money may be earned from recruiting alone (Wikipedia). Mary Kay is an example of a legitimate MLM. Mary Kay employees only earn commissions on its sells and its team sells, not by signing up people (Wikipedia).

So all profit come from basically scamming someone into buying something. But what about all those people making profits? Yes, many people have made a profit off this little scam. However, this profit has all been by scamming others. So people will get rich, but many will not. In a pyramid, there are very few on top, but many at the bottom. You may have a friend trying to get you to join this great opportunity. Of course he is, he is trying to make some money. Your friend knows he is not going to make any money selling music, unless his wife wants to download all of Madonna’s songs. Your friend may even entice you about all the profit he made. Trust me, your friend is not lying, he made a profit, but mostly because of idiots like you. And after scamming you off, you will now carry the burden of having to find other idiots to scam. So for those who don’t have a conscience this is indeed a great way to make money. But, just like any pyramid, there is a bottom. And those are the ones who will be the biggest losers.

Imagine if I had a coconut store, and I decided to franchise out my coconut store. Let’s say that I sell my coconut stores for one hundred dollars and I find five people. I tell those five people they now are able to franchise coconut stores out to people, and I will give them a portion of the profits. This continues many times. All of the coconut stores selling the exact same coconuts. I, who am at top of the pyramid, am making loads of money even though I have yet to sell a coconut. Now let us say that I found out that all the coconuts in my franchises are poisonous. Would this affect revenue? Not at all, because no one is even buying a coconut. This is exactly the same scheme the founders of Burnlounge have done. These founders are the true winners. They are making tons of money, while you, the person driven by greed, are busy scamming your friends and families.

Did anyone ever ask the question, “Why didn’t the founders of Burnlounge sell the music straight to the customer?” The people behind Burnlounge like to tell their customers that they want to give the public access to sell music and opportunity to make money instead of having big companies such as Apple reap all the benefits. The truth, however, is that they make more money selling these “stores” to people like you, and do far less working than trying to sell the music. Because who is Burnlounge’s number one advertiser? You, the person trying to recruit innocent people to scam. The heads, CEOs, whoever is behind Burnlounge does not need to work hard to find customers because they know people’s greed will lead them to Burnlounge.

The old saying goes, “If it seems too good to be true, then it is” is exactly the moral to my story. Everybody is trying to look for an easy dollar. It is our natural instincts as humans to follow greed. That greed leads millions of people to stupid schemes every year. Yes, I understand some people do make a profit with Burnlounge. Those people are the ones who are able to scam many people. And the big winners are the ones who are able to scam lots and lots of people. But at the end of the day, you have to be able to look at yourself in the mirror. For some, they have no conscience. They fail to care about the many who have lost money because they are too busy counting their own. However, I like to pride myself as an ethical man. And I don’t think a few hundred or thousands dollars is worth having the inability to look yourself in the mirror. And worst yet: losing all your friends and families whom you have scammed.