Facebook is poised to launch its first IPO valued at $10 billion. Interestingly enough, this will beat Google’s IPO back in 2004 worth only $1.9 billion. Currently being a private company, Facebook doesn’t have to publish it’s accounting records, but it a report surfacing back in January of 2011 claims that Facebook made a net profit of $355 million on revenues of $1.2 billion in the first nine months of 2010.
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Category Archives ⇒ Internet
Megaupload.com's Creator Kim Dotcom is Imprisoned
A man known as Kim Dotcom (real name, Kim Schmitz) is a 38-year old computer programmer that is best known for creating one of the most popular downloading websites in the world. Megaupload.com operated as a one-click hosting service that allowed users to upload files for sharing worldwide. Unfortunately, the majority of the files available were pirated software, music and movies. On January 20th, 2012, Kim Dotcom was arrested on copyright infringement charges in New Zealand. Today, he was imprisoned and denied bail due to being an extreme flight risk.
Anyone who has ever downloaded something illegal has probably used Megaupload at some point. The service provided storage space online for small fee. Uploaders would store bootlegged movies, music, tv shows, ebooks, software, games and anything else under the sun. The links to this content would then be mass-distributed to the world via websites that offered little to no value to the web community and were usually plastered with seemingly endless advertisements. As a downloader, you could take anything your heart desired. Where Megaupload made its real money was by providing “faster” download services for a fee. As a free user, you were limited to a small number of downloads per day, but most importantly your maximum speed was capped.
Megaupload Stats
Being number one in anything can be difficult, but being number 1 on the Internet (and staying there) can be next to impossible. Although Megaupload.com never reached the coveted rank of the number one visited website in the world, Alexa.com shows that at one point it was the 13th most visited website. Currently it rests at 74. In short time, it will likely fall off the face of the Internet faster than it took me to write that.
At one point or another, this is what Megaupload was pulling down:
- Unique visitors: 81 million
- Pageviews: > 1 billion
- Visitors per day: 50 million
- Daily reach: 4%
- Members: 180 million
It was also estimated that at its peak, Megaupload was responsible for over 4% of all Internet traffic! Not bad for a website started in 2005. Among the other sites that Megaupload Limited operated were websites for videos (Megavideo.com), photos (Megapix.com) and porn (Megaporn.com). All have currently been shut down and now display the infamous FBI anti-piracy logo:
The Seizure
All the websites and domains associated with Megaupload were seized by the 
government a few days ago and as you can plainly see, when you access any of these sites, you are greeted with a friendly reminder that they no longer exist. The charges laid out to Kim Dotcom and Megaupload Limited stem from years of pirating anything digital. While sites like YouTube have solved similar legal issues by installing teams of people with the sole purpose of finding and removing copyrighted videos, Megaupload has allowed its users to upload and share anything and everything.
As a result, New Zealand Police arrested Kim Dotcom and three other Megaupload executives in Auckland on January 20th. The FBI has requested that these four individuals be extradited to the United States. Kim Dotcom was denied bail for fear that if he made it to Germany he would escape extradition.
The indictment indicated that Megaupload differed from other online storage business in a number of ways, in that Megaupload relied heavily on users to download files rather than actually store anything. This was because the vast majority of users did not pay for the service, thereby making Megaupload rely on advertising dollars from ads shown to free downloaders.
The Future
Once this guy gets his sentence, I’m sure the domain and all the business assets (what’s left after the seizure) will be sold off to some other corporation so they can breath life back into the brand. And just like Napster, they will attempt to take the “legal” approach to file sharing. However, the damage is likely done. Those of us who have used it will miss its free and open business model, while those of you who will discover it for the first time in whatever new light is shined on it will never know how great it used to be.
My Two Cents
Kim Dotcom was able to use his business-savvy skills and computer knowledge to create one of the largest file-sharing networks of all time. I remember using the site a few times and always had that first thought of “Why didn’t I think of this?!”, but as I thought more about it, I kept asking myself how websites like Megaupload can exist when it’s crystal clear about what its purpose is—to provide copyrighted material to the world free of charge.
I was reading an article on Yahoo! about Kim Dotcom being arrested and someone left a very interesting comment that I just had to share:
Megaupload was shut down, WITHOUT the need for PIPA or SOPA… Imagine that, the copyright holders using the legal system and EXISTING LAW to bust pirates instead of censoring the internet…
It brings up a very good point and it’s the exact reason I have been so against PIPA and SOPA ever since the new legislation was introduced. The idea that we need more and more laws to combat a problem like this is ridiculous. We have what we need to prosecute people like this and the take-down of the entire Megaupload network is proof that this process works…even in other countries.
iCloud, You Cloud, We All Cloud!
iCloud is coming, and it may just change your life. Apple CEO Steve Jobs unveiled iCloud at the company’s annual World Wide Developer Conference in June. Ever since, the internet has been abuzz with ideas and opinions about what iCloud will mean for the tech giant’s loyal customers.
In short, the iCloud service will allow wireless syncing and storage across iOS platforms, PC’s and Macs. While this may not sound all that impressive at first blush, take a moment to consider what this really means: your music, documents, videos and photos will be accessible from virtually all of your devices simultaneously.
Automatic Syncing
In an increasingly mobile world, Apple is cutting the cord – literally. With iCloud, users will be able to take a picture on their iPhone and have it pushed to their iPod Touch, iPad, Mac and PC automatically.
No more plugging your device into your PC to sync it with your iTunes account, then plugging each device into your computer one at a time to add the photo. Nearly every device you own that runs iTunes or iOS will be able to sync from the cloud instantly, saving both time and frustration.
Service and Storage
Apple’s iCloud service will also provide storage for your devices – up to 5 gigabytes – free of charge, with the ability to purchase upgrades if needed. A 16 or 32 gig device will instantly become 21 or 37 gigs whenever internet access is available, allowing you to store more files and documents without having to shell out extra cash for a larger-capacity device.
iCloud will also work with iTunes, enabling a user to purchase a song or television show on his or her iPad and have it downloaded to their personal computer and iPod at the same time. Past purchases will be viewable on up to 10 devices, removing the need to physically transfer songs from one computer to another.
Home and Mobile Sharing
Homes with multiple iOS devices will enjoy the ability to quickly and easily share documents, photos and music instantly. Apps purchased on your iPad will be sent automatically to all of your other devices as well. Bookmark a page on iBooks on your iPad, and pick up right where you left off on your iPhone when you’re on the go.
With iCloud also comes peace of mind. Your iPhone or iPad will be backed up wirelessly directly to iCloud. Contacts, calendars and important documents will be pushed to the cloud as you update them, meaning users will no longer have to fear losing a phone number or appointment if their iPhone crashes.
Faster Updates
Similarly, new updates will be pushed to your device without the need to download and sync with a computer. Updates will take less time because they will occur incrementally, only downloading whatever changes have been made as opposed to reinstalling the entire operating system with every update.
Few would disagree that the iPhone changed the world of smartphones. Likewise, the iPad is turning the computing world on its head as more consumers opt to make the switch to the revolutionary tablet either to compliment or replace their laptops. All of this means more users on the move, who don’t want or need to be tied to a PC.
Loyal Apple fans have long loved the mobility and accessibility that iOS devices provide, but at the end of the day, they were still tethered to the personal computer. As Apple continues to usher us into a post-PC era, iCloud will bring a new measure of freedom to mobile users worldwide in way they’ve never experienced before.
With a strong background in technical news and information, Blake Sanders writes on behalf of broadband comparison site Broadband Expert. Blake’s specialties are high speed internet, cell phones, as well as news and information on internet service providers.
Ledfrog.com is 11 Years Old Today
Today is the 11th anniversary of Ledfrog.com. This was the day back in 2000 that I submitted my first domain application to solidify my presence on the Internet which was still a growing force not nearly the size that it is today. Here’s a little back story on the domain and why I decided to register it.
AOL 3.0
Readers of my site and those that know me personally most likely already know this part of the story, but it fully explains how the name “ledfrog” came to be. When the Internet was first starting out, there was a plethora of random companies offering services to get you online and it was often a confusing and tedious process—usually ending in a frustrated user with no email. America Online came out of this mess with software for Windows 3.1 back in January of 1993. It was to be the start of an online empire and the most popular Internet software/service the world would ever see.
I didn’t jump into the AOL world until version 3.0 (June of 1996) when we got our Windows 95 computer, but when I did, I was hooked! The thought of having access to the entire world and to be able to communicate with thousands of users anywhere at any given time just excited me.
I can’t remember what my first screenname was, but I do remember it having some numbers in it. See, back in those days there were so many people on AOL, that it seemed like no matter what screenname you came up with, you had to put numbers on it just to make it unique. Well, I sat out to change that. I wanted a short, pronounceable name that had no numbers, didn’t incorporate my real name and wouldn’t be something I’d regret using after growing up.
On July 22, 1998 I was 16 years old and sitting in front of my parent’s computer thinking of that name. At the time, I was using a picture of a small tree frog for my desktop background and listening to Led Zeppelin. It was that simple. Ledfrog was born.
Domain Name
While in high school, a friend and I started building cheap little websites that were hosted on free webservers like FreeYellow.com and Xoom.com. These sites were nothing more than collections of pictures and links for things we were interested in at the time, but for me, they were the start of a new hobby. The problem was that when I do something, I like to do it “pro” so I got tired of having a weblink that looked like: http://www.freeyellow.com/members/pages/username/index.html and wanted something more like http://www.something.com.
At the time, there weren’t any companies like GoDaddy.com where you can register about any domain you want in a matter of seconds. Before, you actually had to print out a paper application, fill it out by hand and send it off with a check for 2 years of registration minimum. It was $35 per year back then!
So again, I sat there thinking—this time of what domain I wanted to get. On a sidenote, I really wish I had a lot of money at this time. Looking back at how many valuable domain names were still available just blows my mind. But like any investment, there are never any guarantees. Most of us never would have thought the domain business would get to where it is.
Anyway, wishing to spend my $70 wisely, I opted to stay with the ledfrog name and decided to create a brand out of it. From that point forward, this domain has served as a fan site for Metallica, an FTP server, a collection of links to popular “hacking” tools for AOL and other things, a personal page for me, an FTP server again, a blank page, a forwarded page to other domains and now finally (since 2008), a blog mostly about technology. I remember one of the greatest satisfactions I got while running the FTP server was when I asked a co-worker one day if he knew where I could download a particular freeware program and he said, “There’s a site I found called Ledfrog.com that has a lot of stuff…you could try there.” I was floored that someone actually knew my site without me telling them about it!
I’ve come a long way with this domain and through the years I’ve owned well over 80 different domains, sold a few and made some money, started websites and failed, had ideas that never materialized but had fun each and every day. For me, Ledfrog.com had withstood the time and is currently my oldest and most active domain. It is here to stay for quite a while!
Google+ Versus Facebook
I have always been wondering when the demise of Facebook would start just like how MySpace quickly came and went along with other social networking sites like Bebo and Friendster. The old saying, “Nothing lasts forever” couldn’t be more true in the Internet world. In fact, you could easily change that to, “Nothing lasts 4 years.” Experts have already predicted that Facebook has already reached its peak and in time, members will slowly dwindle away. So what causes this? Well, a number of things could contribute to a website losing popularity. They could reach the pinnacle of their innovation, people can lose interest as they get older, younger people might find other things to do or maybe there are too many spammers and ads.
Whatever the case may be, we can guarantee that corporate America will always be there to ride the money-train as long as there are tracks to roll on. Enter Google Inc.
Google+
The latest competition to Facebook is by none other than Google. Of course like every other beta service they launch, it’s by invitation only and they are currently “at capacity”, but you can check out the Google+ Tour on their site. I won’t go over everything here, but I do want to touch on 3 of Google+’s features.
Circles
Circles is a way in which you can group your contacts into various categories. As an example, you can have your school friends, your drinking friends, your co-workers and your family members all in different circles. This is a neat feature that allows you to share specific information only with certain people.
On Facebook, if you write something on your wall, everyone gets to see it and we all know what kind of trouble that can cause!
Google describes circles as:
You share different things with different people. But sharing the right stuff with the right people shouldn’t be a hassle. Circles makes it easy to put your friends from Saturday night in one circle, your parents in another, and your boss in a circle by himself, just like real life.
Sparks
Sparks allows you to tell Google about the things you’re interested in and as you would have guessed, they will bring you the latest search results and news updates related to these items. I like Google’s explanation much better:
Remember when your Grandpa used to cut articles out of the paper and send them to you? That was nice. That’s kind of what Sparks does: looks for videos and articles it thinks you’ll like, so when you’re free, there’s always something to watch, read, and share. Grandpa would approve.
Hangouts
I really like this feature because it allows you to join in conversations that your other friends are having at any time. It’s kind of like running into a friend at the store only now it’s online!
Bumping into friends while you’re out and about is one of the best parts of going out and about. With Hangouts, the unplanned meet-up comes to the web for the first time. Let buddies know you’re hanging out and see who drops by for a face-to-face-to-face chat. Until we perfect teleportation, it’s the next best thing.
My two cents
If there ever was a worth challenger to Facebook, I would imagine Google would be it. Google has just about every other service under the sun so it only seems fitting that they add a social networking site to the mix. After looking at what Google+ promises to offer, I think the experience will be far better than that of Facebook, but I also think Google will have a lot of catch up to do. As far as customers dropping off of Facebook in exchange for Google+—I don’t think that will happen. Personally, I’ll have a Google+ account and we’ll see how things go.
As for right now, I placed my name on the waiting list to be invited into the exclusive club. We’ll see what happens.
Is Cloud Computing Really The Future?
Lately, we’ve all been hit with talk about the future of computing and how everything might end up on “cloud” services. As a result of this forward-thinking movement, everyone seems to have gotten in the game: Apple with iCloud, Google with GoogleApps and now Microsoft with Office 365. While each have touted their superiority over the others, it’s hard to imagine a computing experience existing only on the Internet. But I guess 20 years ago they said it would be hard to imagine something like the Internet too.
Originally, I was thinking that this is a good idea because how often have you been away from your computer and needed a file or two only to remember that even though you’re carrying a capable smartphone, a laptop and a tablet device, the one file you needed most was at home stuck on your hard drive? For me, it happens fairly often. Of course, it’s nothing that would stop the world from spinning, but out of convenience, it would be nice to have a place where everything resides.
I like to think of cloud computing like IMAP email where you can connect all of your devices to your one email account and no matter which device you use to send, receive, move or delete messages, every device always has the same updated information. However, there are others that think the cloud poses a threat to security and privacy. They might be on to something here.
Cloud Computing
I decided to create a pros and cons list to cloud computing and let the readers decide for themselves.
Pros
- Access – Likely the number one reason the cloud looks like a good idea—the ability to access your files from any Internet connection is very convenient.
- HDD space – Depending on what service you use and how much it costs, you can determine how much storage space you get. In turn, you are also saving local space on your computer.
- Safe and secure – Putting your files in the cloud can remove it from threats such as house fires, theft, auto accidents, plane crashes and viruses.
- Collaboration – Businesses and teams alike can work on files at the same time for a truly live collaboration between multiple people located in various parts of the world.
- Cost savings – This one is subjective, but the cloud could save you money from not having to spend it on hardware, more computers or other devices.
Cons
- Security – Putting anything out on the Internet can be potentially dangerous in two ways—simply storing it and then transferring it.
- Privacy – This one is for the paranoid, but is it possible for employees of such cloud systems to have access to client’s files? If so, what could a disgruntled employee be capable of doing with such access??
- Reliability – The cloud cannot exist without the Internet, so if you ever lose your connection, you won’t have access to your files. Try working on an airplane now!
- Speed – Again, due to the Internet reliance, transferring large files to and from a cloud service can pose a problem. Especially if you’re trying to make it out the door in a flash.
- Storage space – No cloud service seems to offer LARGE amounts (above 5gb) of storage space so at this time, it would be foolish to think you can store all your movies, videos and music.
My two cents
I see both sides to this coin, so I can see myself using the cloud for some things, but not others. I find that some of my more pertinent documents would be put in the cloud only if I see a use for them at work or at a friend’s location. However, I have many, many gigs of data that I know I would never be able to put in a cloud service nor would I want to. What’s the alternative? I created a very organized computer system that I run local servers on (FTP, web and mail) as well as Remote Desktop Connection so I can access this computer through any desktop or laptop and even some mobile smartphones.
In a sense, I created my own cloud. If you’re interested in something a little less cumbersome, you might want to check out a free service from Tonido. They offer the ability to create your own personal cloud without all the headache of setting everything up.
Google Sets Out To Buy Hulu
If owning YouTube wasn’t enough, now the technology giant sets its sights on Hulu. Currently, Hulu is a jointly-owned outfit run by the likes of Disney, NBC Universal and News Corp. The service picks up the slack where YouTube drops it off—broadcasting tv shows and other specials that are wholly owned by mass media outlets like NBC Universal, CBS, ABC, etc.
If this purchase were to happen, it would be hard to imagine what or who could get in Google’s way. Google already has the largest and most popular search engine today and the most populated self-promoting video site available. If they add Hulu to that mix, they would have a trifecta from hell! Well, maybe it won’t be that bad, but the idea that one company could theoretically be at the helm of the web’s top three search, video and tv site is pretty scary.
Google is already in hot water over allegations that they favor their own services in search results when compared to paying advertisers. Their complaint is that other companies can’t compete with Google due to the massive amount of services and products they offer. I have to agree, but is all these ill-thoughts toward Google valid? I mean, if a company makes great products and people love using them, how is it their fault that competitors have it tough?
At any rate, the Hulu purchase would further allow Google into the connected devices of Americans all over the country via the Hulu Plus subscription. Hulu Plus allows paying members the ability to connect Hulu accounts to almost any media device: Blu-ray players, gaming consoles, smartphones, Internet-tvs and those new refrigerators that have built-in wi-fi and LCD screens. Google had already expressed major interest in a Google TV service that offered these features. Maybe it’s safe to say that Google can now proceed with that idea and adding Hulu to the mix as a fore-front content provider. Or maybe Google can simply re-brand Hulu into Google TV.
Whatever the case may be, let’s just hope things get better instead of worse. Right now, there’s an epidemic of floundering websites and media services that come and go by the night, all competing for your eyes. Only time will tell who the victor is, but one thing’s for sure, the mega powerhouse Google is not going away anytime soon.
OS X Lion Coming, Automatic Facebook Updates and Google Antitrust Case
For Friday’s offering, I bring you 3 top stories that I haven’t already covered this week. Speaking of which, after this week’s articles, I have successfully talked myself into getting a Windows Phone 7 device, practically almost fell out of my seat when I realized I might be getting rid of iPhone once and for all and learned that Nokia might be stepping back into the U.S. marketplace with new Windows phones slated for 2012. In other words, I’m done talking about all these changes for now! See you next week!!
OS X Lion
Snow Leopard has received its final update in preparation of OS X Lion coming out very soon. The new 10.6.8 update provides better support for iPv6, improved VPN reliability and addresses some known security issues including:
- Bogus Mac Defender software
- Malicious fonts embedded into documents that wreak havoc on Mac machines
- Maliciously embedded ColorSync profiles
- Ability for network admins to view wireless tranmissions
The update also modifies the operating system to allow for a direct connection to the Mac App store allowing users wishing to upgrade to Lion the ability to do so as a direct download rather than going into an Apple Store to purchase the disc. Both options are available for $29.95. OS X Snow Leopard was more of performance and reliability upgrade rather than adding new features, but Apple promises OS X Lion will be all about new features.
If updating from 10.6.7, the new update download will be 275.3MB.
Automatic Facebook Update Service
If there was ever one of those times where you can say, “Why didn’t I think of that?”, this is it! According Precreate Solutions, clients have reported more home break-ins whenever they leave Facebook status messages claiming they’ll be out of town for extended periods of time. If we didn’t already have so much to worry about this day in age, now we have to wonder who will be seeing our updates as invitations to go to my house and steal my tv. I don’t know what’s worse—that people are actually actively looking for these things on Facebook or that one of my “friends” actually wants to rob me!
Anyway, Precreate Solutions is now offering a service that will monitor and update your Facebook statuses to give the impression that, not only are you home, but that your everyday digital life is continuing without interruption. Of course this service comes with a fee. A quick look at their website doesn’t seem to offer this service outright, but it may very well be an add-on service for existing clients.
The service works by using messages from a pre-approved message list to be applied to your Facebook status. Whether or not these messages can be created by the client is not known, but one thing’s for sure: don’t start posting your own statuses when you get to your vacation spot or you’ll instantly blow your cover!
Google Antitrust Case
Although Google claims they are still “unclear exactly what the FTC’s concerns are”, Federal regulators have launched an antitrust investigation into Google’s business practices. It seems that competitors are complaining that Google uses their enormous clout to favor their own services and business operations over those of their rivals. Google stated on their blog site: “We make hundreds of changes to our algorithms every year to improve your search experience, [and] not every website can come out at the top of the page, or even appear on the first page of our search results.”
It would be hard to imagine Google playing this game considering that their main focus has always been on the user and the overall search experience. Google’s own philosophy is that if they focus on users, all else will follow. Since the complaints are coming from competitors and not users, one would think that the organic search results showing up on Google are being generated completely by the users.
Besides, if Google happens to offer a service for just about everything you can think of, wouldn’t you assume that their presence in the search results will be fairly large? I think the real complaint is that rivals are not getting the results they want and because Google handles 2 out of every 3 searches online these days, they just need someone to pin it on.
New TLDs to come in the domain namespace
The votes are in…as of today, the heads of the Internet (as I like to call them), ICANN has voted to allow virtually an unlimited amount of new domain names to be made available for registration. To see what I mean, let’s break down a current domain name:
ledfrog.com is a 2nd-level domain registration within the .com namespace. With .com being a top-level domain (TLD) that allows unregulated registrations in the 2nd level, anyone can register a .com domain if it’s available.
Throughout the years, new TLDs or extensions were adding to the domain system to help alleviate demand for domain names. Among vanity extensions such as .travel, .info and .biz, each country in the world was assigned a 2-character country code to allow those countries to offer domains to its citizens. More recently, ICANN approved the use of .xxx specifically for adult-content sites.
This system has worked rather well consider how old DNS is! However, with the advent of new technology and masses of people jumping online each and every day, large companies have had to register handfuls of domains just to protect their brands and trademarks. With over 300 TLDs currently available, these costs can add up. Current registration costs can range from $7 to $600 per year for each domain. That’s even if they can get their brand as a domain. Dealing with cyber-squatters and other infringers have likely cost companies millions of dollars.
The future of domains appears to be the availability of new, custom registrations of top-level domains. Imagine Apple Inc. being able to own .apple or .iphone!
To be honest, when I first heard this news, I was worried. I feel like part of the domain system is the uniqueness of it—the rarity of it. Of course, this could just be me looking at it from a business standpoint, but I’m under the impression that offering these unlimited domains will essentially devalue domains as a whole.
That was until I found out about the registration costs! ICANN has announced that each application will carry a fee of $185,000 while annual renewal of the domain will cost $25,000. This should stop 99% of the spammers out there for sure!
It’s clear that these domains will be somewhat of a luxury for large coporations and/or the rich individual who might want to register some generic domain name like .car or .games which makes me feel better about not letting another million useless websites appear online overnight from people looking to make money off selling a domain name.
While this new plan seems like a good idea on the surface, another concern I have is how the public will accept this. Anyone who follows the domain industry knows how hard it has been to promote any domain other than .com, so how will this be any different? The Internet world is so used to typing in something and then following it with .com or another known extension, but this is just confusing. Typing in .apple just doesn’t make sense, but I guess that’s what people said 30 years ago when people were just learning about the Internet.
I’ve been on the Internet since 1997 and I’ve seen a lot of changes in the domain industry and this is by far the largest of them all. But one thing has remained true throughout all of it—nobody remembers a domain extension as well as a .com domain. In this case, only time will tell if this will change.
Don Lapre in hot water for bilking $52 million
Anyone who’s my age probably remembers spending a late night or two watching a funny little man on tv telling us how he was able to make $50,000 a week “placing tiny classified ads in newspapers” from his “one-bedroom apartment”. Right in those two quotes, you have the makings of a very successful infomercial—mention how lots of money can be made with seemingly little work and cater to others who might be living in a one-bedroom apartment as these people are likely to want an opportunity that will change their lives.
If you have no idea who I’m talking about, check out this video…it’s exactly what I remember when I was younger:
First of all, this guy is good and there’s no doubt about it. As a firm believer that hard work pays off and there’s no easy way of making lots of money, I never “fell” for one his claims, but I will admit that there were a few times when it seemed like the plan would work. More importantly, there are many other people out there that are worse off than me financially and just might jump at the chance to make even 100 more dollars a week.
The indictment
Don Lapre has been running infomercials like these for the last 8 years or so selling all sorts of money-making packages that are guaranteed to turn your life around. The two most prominent ones include the one above and another selling the The Greatest Vitamin in the World. This is the one that’s garnered the attention of the Feds and the United States Postal Service.
According to the case, Don Lapre is being indicted on 41 counts of conspiracy, mail fraud, wire fraud and promotional money laundering. It’s being claimed that he bilked over $52 million from some 200,000 unsuspecting consumers. Essentially, he’s being accused of running a nationwide scheme to sell worthless internet businesses.
The program
I don’t want to get into all the details here because the case file says it all in a 28-page PDF document available from Casewatch.org, but I do want to briefly explain what it is that Don Lapre does. Using The Greatest Vitamin in the World program as an example, this is how the program works.
- Watch Don’s infomercial and get excited about the potential of making lots of money.
- Call the 800 number to order the start-up package and personal website for $35.00 plus $13.65 shipping.
- Don’s reps would then call back consumers telling them that there were more fees in running the personal website including a $295 setup fee and $9.95 per month hosting fees.
- Don’s reps would try to upsell customers into buying web traffic for their new site guaranteeing them that people would come to the site and buy products or signup as new “investors”.
- Customers buy traffic packages ranging in price from $500-2000.
- Customers are offered sales incentives: Get 20 new people to sign up for the program and get $1000. Get 100 new vitamin customers in a month and get $10,000. For every 5 $1000 bonuses you earn, you get a 7-day paid vacation for 2.
My two cents
First of all, the vitamins are worthless. To Don, getting new sales people all dropping about $3000 to start their own business is where the money really is. Unfortunately, this is nothing more than a pyramid scheme. The ones at the top who are able to get to everyone who hasn’t joined yet will make all the referral fees. The ones at the bottom will have nobody to recruit because they’ve all been recruited…after some time, the pyramid crumbles because there’s nothing left to do but sell worthless vitamins and the guys at the top take their money and run.
Second, if you really think about it, why would Don Lapre (or any tv pitchman) want to tell you his money-making secrets if what he’s doing already makes him so much money? Do you really believe he’s out there trying to help the community? Do you really think he cares about helping you make more money in life? The answer is no. It’s the tell-tale sign of a scam and it’s no different than all those bloggers out there selling you $47 money-making plans that tell you all the secrets of Internet marketing. Trust me, if I discovered a way to make $50,000 a week, I wouldn’t tell anyone! Not because I’m selfish, but because I wouldn’t want to create thousands of competitors out there. If there’s only $50,000 to be made, that means I’d have to share it with everyone else who copies me. That’s not a good business plan!
I’ll tell you a secret. There are no secret ways to make money! There are however innovative ideas that will make someone millions one day, but those aren’t secrets—sometimes those are flukes or fads or streaks of luck. Facebook is a perfect example—sheer luck. The point is to make real money, you have to put in real work. If you think you’re going to make $50,000 a week with only a few minutes of work, you’re either delusional or you’re the one sitting on top of the pyramid because in any other situation, you’re not going to make anything close to that.
Ok, I’m done venting…the last thing I want to say is that I hope Don Lapre goes away forever! He’s a con artist and a thief. At the same time, I hope none of those people get their money back so maybe they’ll learn from their mistakes.