BlastOff Scam

Michael Arrington over at TechCrunch recently generated some controversy for calling out the shady advertising techniques used by some social gaming companies.  These companies use services such as OfferPal to give their customers a means of generating in-game currency by completing surveys and accepting “free” trials of products.  While some of these offers are from reputable companies such as Netflix, many are from questionably useful services with a lot of fine print, essentially tricking gamers into much larger purchases.

While these offers are probably legal (depending on the placement of the fine print), the most dubious end up being the most profitable.  Michael coined the ecosystem “Scamville”, saying,

“The reason why I call this an ecosystem is that it’s a self-reinforcing downward cycle. Users are tricked into these lead gen scams. The games get paid, and they plow that money back into Facebook and MySpace in advertising, getting more users. Who are then monetized via lead gen scams.  That money is then plowed back into Facebook and MySpace in advertising to get more users…”

and simply,

“The games that scam the most, win.”

This is essentially the same thing that could happen with the BlastOff Network.  As they get more and more people to spam their friends, they will earn more revenue from people shopping through their platform.  Thus they will have more revenue to pay for seminars and other advertising to grow the network.  This is not necessarily illegal, but it can really drive up profits for a service of questionable value.

With similar ethical profiles, the BlastOff Network and OfferPal would make a great team.  Any predictions on when they will form a relationship?  The over-under is 6 months, by May 1, 2010.  Add your predictions to the comments below.

This entry was posted on Sunday, November 1st, 2009 at 1:11 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.