If a tangible item is sold, wouldnt that be legal?

[camaroz]

Hi,
I was just wondering if the courts would have anything against ezexpo if they simply sold overpriced tangible items, such as headphones, DVD's, or promotional items(mugs, pens, keychains) advertising their site, in exchange for free placement?

Thanks,
-David-

[Arzel]

It depends on the value of the tangible good in retrospect to the cost. For example, let say you are selling engraved mugs.

If an individual would buy the mug without the entry into the matrix then there is nothing wrong with that, but if they are only buying the mug to gain entry into the matrix, then you have may have a legal issue.

Now you still may be ok if you could show that the said mug is actually worth what you are selling it for. The problem with some of the 'tabgible' goods is that their actual value is much less than what they are being sold for. If you are selling your mugs for $100 (with an entry into a matrix), and everyone else is selling the mug for $10 then you are really selling the matrix, which is not legal.

You run into these kinds of issues in many states where it is illegal to sell concert/professional sporting event tickets for more than the face value of the ticket. Some people will try to get around this by selling an item, usually a baseball or football card for a huge amount of money, and then throw in the tickets for free. This is not legal if the card is basically worthless.

[djvennix]

what about selling web hosting?

[camaroz]

djvennix,
That's another option i was thinking about too. The problem with that is you'd have to buy a new hosting account for every item you want placement in a matrix for. Some buyers will have little use for a single hosting account, much less multiple ones.

[Arzel]

I know that there is at least one site already selling web hosting, but I am not sure what site that is off the top of my head.

I don't think that that would be a problem, but I think the main problem with almost every matrix site is the way they planned their company.

Normally when you start a business to sell something you develop something that people want to buy, or find something people want to buy and develop a marketing strategy to sell that item. This is very difficult, and is why most new small companies sell a service that people desire or need (handiwork, landscaping, dentistry, computer service, lawyers, designers, ect.) New companies that actually sell tangible goods almost always fill a niche (crafts, handmade furniture, art, ect.)

The matrix compaines, however, are trying to sell an idea (the matrix) which is much more difficult. Because the basic nature of the matrix is not legal (argue as much as you want, but it is a ponzi), the companies try to sell something else. So instead of developing the company in the traditional sense, they attempt to make their idea legal, working backwards. The result is a glut of companies selling the same thing, no niche filled, nothing unique about any of them (for the most part).

So I ask you, are you just trying to start a matrix? Because if you are, I suggest you stop trying to find something to sell that matrix, unless that item can sell on it's own, in which case the matrix serves only to give your business a push, because you will have to end that matrix very shortly. It is a proven fact that every matrix will fail, if you want the mathmatical proof just let me know.

Finally, I do think a matrix could be a valuable marketing tool if used properly, but it's use would be very limited, and unlike any of the current buisnesses you currently see.

[djvennix]

Originally posted by camaroz
djvennix,
That's another option i was thinking about too. The problem with that is you'd have to buy a new hosting account for every item you want placement in a matrix for. Some buyers will have little use for a single hosting account, much less multiple ones.

For example the different items would have different web hosting packages.

the x-box would have a cheaper web hosting package. and the plasma tv would have a web hosting package with everything.

Its not the job of the person selling the web hosting to tell someone if they have use for the product or multiple products - the customer makes that decision.

And as long as the length of the lists are available and the rules are explained, then I think the risk is on the customer.

[camaroz]

Thanks for the comments,
I think a web hosting matrix may be the way to go... I know where to get a 3gb space/30gb bandwidth account, with WHM(web hosting manager) that creates individual cpanel accounts for each account I setup. This only costs $13.50/month, and gives you unlimited everything(besides space and bandwidth). SQL databases, email accounts, etc...
It would take a huge number of accounts to support a large matrix site though.

BTW, vipermatrix.com is the web site I think you were referring to.

[MatrixWatch]

An answer to the first post within this thread would, of course, be relative to individual state laws (one of the beauties of America). However, I would walk very cautiously.. Here's why. If you have read the law suit, there is a quickly-stated illustration in there that shows the failure of the "e-book" logic. It is illegal to run a pyramid, and the matrix sites feel that they can hide within the loophole of selling e-books and provding the pyramid for free. The illustration employed in the law suit likens this to a prostitute selling a glass of chardonay, and telling the officer that the sex was for free. Jeffrey Wilens (wilens@cox.net) used a barber shop illustration in the article by MSNBC's Bob Sullivan to covey the same point. So, when I read that you still want to offer a matrix list, but you are now selling web-hosting... If I were you, I would speak to TEN lawyers before I went forward with that idea.

[blademaster]

If you were thinking about opening a matrix site you are heartless. Do the math. Eventually hundreds if not thousands or tens of thousands of people are going to make an investment with no return. Sure its a choice the consumer makes but does that make it right? Hell no. It is a scam. Sure some people benefit(but no one more than the owner) Sooner or later you will have to pay the piper when the lists stop filling up. You will piss many people off to the point of suing you or threatening your life. I seriously consider you to re-evaluate your plans on finding a good product for a matrix site. I actually was considering starting one until i became educated on the subject. It is not fair to profit off of hundreds/thousands of people who will never see one penny of their money back.