Last month, TheDigitalMusicWeblog exposed the growing concern in the digital music industry over the questionable practices of BurnLounge, a digital music sales service that appears to have more in common with a pyramid selling scheme than legitimate digital music stores. Since we posted that article we've seen a storm of controversy erupt in our forums as fans of the company go head to head with those who feel that BurnLounge is giving the digital music industry a bad name.
BurnLounge markets itself as a community based digital music download service which allows users to construct their own personal digital download stores to make profits from sales of music, but in reality it operates like a multi-level marketing scheme where the only real profits are derived from sign-up and subscription fees. Higher level users receive a share of revenue from any affiliates that they personally sign up to the BurnLounge, which includes both revenue derived from digital download sales through the affiliates stores and also the sign-up or subscription fees that the affiliate generates. With subscription fees ranging anywhere between $29.95 to a whopping $605.35 per year, there's plenty of money at stake.
Since downloads from the service are priced on a similar level to iTunes, and BurnLounge offers no significant additional functionality, I think that the the real business model is about sign-up fees, not about downloads, and a fair few of our readers appear to agree. Since posting this article, we've been inundated with feedback which has tended to fall into two opposing camps - the first from people who have been ripped off by BurnLounge, the second from BurnLounge zealots writing in to defend the service. The BurnLounge zealots were surprisingly uniform in their sunny responses, and occasionally sounded more like Kool Aid drinking cult members than legitimate business people, while the stories told by disaffected users are a very story altogether.
We here at the DigitalMusicWeblog think that people should give BurnLounge a wide berth - but you can make your own mind up with this sample of comments from our readers:
Burners
All info seems to support a finacial collision is on the way for all working retailers involved with Burnlounge. This, simply means people will become rich with this company. All power players will have critics and supporters. BURNLOUNGE, I applaud you and I'm a Huge supporter and will sign the dotted line today... - Jack Pope
It never ceases to amaze me how ignerance and lack of education paves the way for those who live in glass houses and there stone throwing antics. - Michelle
BurnLounge is CHANGING the entire distribution channel for music and entertainment. Before, companies held the key to distribution... now we do. Anyone can get involved. This is one of the most amazing things to hit the music and entertainment industries... - LT
..this company WILL change the way music is bought, sold, and distributed! Just wait and see in about 2 weeks when they will have over 1 million downloads. Can you say, move over iTunes? - Rose
We Will Succeed By Attracting To Ourself The Forces We Wish To Use, And The Cooperation Of Other People. We Will Eliminate Hatred, Envy, Jealousy, Selfishness, And Cynicism, By Developing Love For All Humanity, Because We Know That A Negative Attitude Toward Others Can NEVER Bring Us Success. We Will Cause Others To Believe In Us, Because We Will Believe In Them, And In Ourself. We Will Start Today. - Kris
This is a solid company with a great concept. Many people will benifit from this. Some of you obviously won't. Do any of you download music "legally"? Or are you part of the slimewire camp that thinks everything should be free. - Chris
Do not sweat the negative people in life. There will be plenty of people who have hangups about making money...ignore them. You all have entrepreneurial spirit. I applaud you. - Anonymous
I am so glad that I got in on the ground floor. Yes, I took a risk with my $500.00 but thats a risk that could make me live in comfort for the rest of life. - CAMERON
Burnlounge will allow you to copyright your own music and sign a deal so you can sell your own music from your own store. Not to mention they have some of the biggest names in the industry invested into this company. Do some research. - NM
Burned
The name is appropriate. A lot of people are going to get burned by BurnLounge. The chances that your average Joe will sell enough on BurnLounge to cover the annual fees are slim to none. - Eric Hamilton
This company is a major scam, and I wouldn't be surprised if there is an FTC crackdown on them soon enough. - Jerimi
Burnloungers always try to come up with some half-baked argument, but in reality, all they see is that they can scam others into joining Burnlounge to take a piece of the $600 up front payment. - Tony Zeoli
I have been on BurnLounge for a few months now and its alot of hype. I haven't made a dime from my record sales. - Christopher Valdez
Burnlounge is a scam. And all of you that are supporting it are slimy people. Let me just say this again - Burn Lounge is HUGE pyramid scheme.. ...I drank the koolaid. I was sucked by 2 of my friends into joining at the mogul level. And have made a total of 50 cents in return. - Buyerof SnakeOil
...its way hard to make money off of downloads at only 2 cents per download- youd have to sell over 500 songs a month just to make back your monthly fees. - BlueFishTShirts.com













61. If people just took the time to thoroughly read the information and decided HOW they want to be involved with BurnLounge, perhaps they would gain a better understanding of what it is all about. If you think getting involved for $29 a YEAR is too much money, you don't belong in ANY business period. In terms of introducing the system to like-minded individuals, and sharing the opportunity, HOW you choose to share it and educate interested parties is equallt as important as how you choose to get involved. Perhaps a reason why many people have felt "cheated" or "scammed" - because whoever shared the opportunity with them didn't follow the system and the processes in place to transfer the knowledge required to make an EDUCATED decision, or form an EDUCATED opinion on whether or not to get involved with it as a BUSINESS.
If someone approached you on the street and offered you the chance to start your own music business for $500, gave you a store-front and never spoke to you again - your likelihood of success is obviously nil. On the same token, if you were currently running your own startup business, took a drag-net and pulled everyone off the street to make them work for you as new-hires without even interviewing or qualifying any of them before bringing them on board your team - but just showing them a pamphlet on "how to make a an extra buck", how do you expect your company to be profitable or even operate? nevermind becoming successful.
BurnLounge is going to revolutionize the delivery of digital content to the desktop, (and soon, many other products), whether you want to be involved on the BUSINESS side, or just as a user - it's up to you. No one is forcing you to do either. Did anyone FORCE you to use google to find this article? Did anyone FORCE you to click on Internet Explorer to surf the web? Did someone FORCE you to sign up on gMail or use eBay to sell your junk? How about mySpace? Were 149 million people coerced into using that service by unscrupulous methods? NO, Probably not - someone told you about it, you checked it out, and you just accepted it or signed up as a user and didn't even question it. THAT is what's going to happen with BurnLounge version 2.0 which is slated for launch in March 2007. Using it will likely be just as common as having a mySpace page, or iTunes account (Burnlounge combines elements of both by the way) - and you can MONETIZE your involvement. When was the last time Tom from mySpace sent you a cheque? or how about iTunes for downloading a song? You pay your cellphone bill and extra fees for downloading ring-tones or games without even batting an eye - why do people freak out when BurnLounge charges $29 a YEAR to have access to similar tools and resources? Sure, you can get involved on the business side, and invest in it like a BUSINESS - but you are expected to TREAT IT LIKE A BUSINESS. Anyone who doesn't think the market for digital content (music, games, ringtones, eBooks, podcasts, blogs, etc etc) is growing at an exponential rate really needs to take a look around. In a couple years, rather than asking someone to 'google this' or 'google that' - you will be searching for digital content within BurnLounge. If you think BurnLounge's business model and compensation plan is flawed, DON'T GET INVOLVED - simple as that. If someone is trying to TRICK you into something, ANYTHING, why don't you do your due dilligence? and please don't believe the hype - you should take the time to educate yourself to make your own decision. But in 5 years when there's a BurnLounge icon on just as many desktops as there are MSN messenger icons or google desktop search icons, I hope you think about this post.
The only place you'll find success before work is in the dictionary. Remember that.
Visit the following link and read, watch and listen to ALL the material and notice who is involved - then form your own opinion
BurnLounge Alliance.NET
Independant Retailer.
Posted at 9:14PM on Jan 9th 2007 by burnloungealliance