Wednesday, January 25, 2006

AutoSurf: making money the easy way, or is it?

I got to know about this AutoSurf thing today from a friend and I have to admit it's a very tempting way to earn money. In particular he introduced me to a company called 12 Daily Pro (Google for them... I'm not going to link to them).

I don't intend to harp on the virtues of making money through AutoSurfing lest I tempt you into signing up. No... I'm here to tell you why you should not join such schemes. I will be basing this post on the model of 12 Daily Pro (other AutoSurf providers operate in a similar way).

What is AutoSurf?

At the most basic level, AutoSurfing is a way of making money on the Internet simply by watching ads. In the case of 12 Daily Pro, members need to watch a minimum of 12 ads per day and in return the member earns a return of 12% of his initial investment! Sound great doesn't it?

How does one earn money from AutoSurfing?

Now you may be asking; do I have to pay money to earn money? The answer to this question should be obvious... yes! You definitely do.

12 Daily Pro insists that each member perform an "upgrade" to their accounts in order to profit from their operation. Each "upgrade" unit costs USD6 and lasts for 12 days. The amount of money you pay for your upgrade must be a multiple of 6 with a maximum "upgrade" payment of USD6000. The member earns 12% of the sum paid for the "upgrade" each day he fulfills the ad quota (yes, you read right; 12%).

What returns can I expect?

Let's say that you fork out USD6000 and watch 12 of their ads for 12 days. After the 12 days are up your "upgrade" expires. Let's do some simple mathematics:

Payment to upgrade: USD6000.
Daily Interest: 12% of USD 6000 = USD720.
Total earned after 12 days: USD720 * 12 = USD8640.

Holy shit! That's a profit of USD2640 after 12 days! That means a return of 44% after 12 days! Even Ah Longs (loan sharks) don't earn that much.

By now I hope alarm bells are ringing in your heads. If they are not then you are probably already familiar with this scheme.

Just how exactly does a business afford to pay it's investors a 44% return after 12 days of investment? Well if you think it's impossible then think again. It's actually very simple. Have you ever heard of the term pyramid scheme? There's one caveat though, there are much more losers than winners.

Pyramid Schemes

Yes the dreaded pyramid scheme model has been brought to the Net. Unfortunately 12 Daily Pro is not the first operation to bring this scheme to the Internet and no doubt it will not be the last.

What happens in a pyramid scheme is this:

  1. Members are promised hefty returns on their investments.
  2. Members get interested and pump in money.
  3. Members are given incentives to get new sign-ups. Often the upline member is given a commission of the earning of his downline.
  4. Members are paid their promised returns.
  5. Members are encouraged to re-invest their earnings into the system to gain even more profit.

The above is true for 12 Daily Pro except for item 3 as 12 Daily Pro gives the upline member 12% of the "upgrade" fee paid by the downline member. No commision is given from the downline's earnings.

Now if you look at the 5 points highlited above you might have noticed a glaring omission. How exactly does the company operating the scheme earn money to sustain their payoff to members? Where do the profits come from?

12 Daily Pro claims that they earn money through avenues other than collecting "upgrade" fees. Examples mentioned in their website include advertising and off-site investments. Seriously if you believe this than you are quite a fool. The ONLY way for them to raise enough money to pay off their members is through the "upgrade" fees of members alone.

Now what happens when the company reaches critical mass? What happens when inflow of cash from new recruits seize to be enough to pay for the commission of existing members? Well for the company there is only one thing they can do and that is close shop and run away with your money. That my friend is the modus operandi of all pyramid schemes.

Summary

I hope this short article has given you a good idea of why you should not bother wasting your hard earned money on AutoSurfing. If it's not already clear enough let me reiterate:

  1. Your investment is extremely high risk. On a scale of 1 to 10 I elect to choose 11. Whatever amount of money you decide to put into the scheme you may lose it the very next second. Really, I'm not kidding.
  2. Pyramid schemes by nature will fail and usually in a short span of time. Expect them to fail after a few months.
  3. There will be victims... it may not be you yourself but it may be your downline who is likely to be your friend or family.

I have to admit that it's also possible to earn money from this scheme. However be well aware of the risks and don't drag any innocent people down with you.

posted by wyejon at Wednesday, January 25, 2006 (permalink) |

14 wise words from our readers:

a golden opinion from Anonymous naive idealist

like old saying, a fool fools the others..who ever believe is a fool..

12:24 PM  

a golden opinion from Blogger Seymour Cakes

The other day, a friend of mine keep sending me stuff like "Earn quick money" and shits like that.

He sniggers all the time.

4:40 PM  

a golden opinion from Blogger wyejon

seymores: guess who told me about this? hehehe... wanna play nevermind just dun risk too much on it.

4:42 PM  

a golden opinion from Blogger MoonCake

Most investment are risky.. Do invest wisely ... dude :-D

10:04 AM  

a golden opinion from Blogger Internet Marketer

This post has been removed by a blog administrator.

11:34 AM  

a golden opinion from Blogger wyejon

rm: I don't think I ever said it was illegal. What I did highlight are the risks and the victims that such schemes will create.

Now I have no idea if it's illegal in any country but don't kid yourself. It is nothing but a pyramid scheme.

11:45 AM  

a golden opinion from Anonymous Anonymous

wyejon, you are not very smart. First of all the definition of pyramid scheme involves multi levels of payoff. 12DailyPro only uses one layer, meaning that you make money off of your referal, but not your referal's referal. Therefore, it is not a pyramid system!! or "scheme" as you put it. Second of all this "risk" you are warning about does exist, but it is very small. 12DAilyPro has been paying 12% every day for almost nine months now. And lastly, your logic that 12DailyPro pays its members simply from "upgrading fees" is just plain stupid. Think about it, the payoffs are greater (by 44%) than the upgrading fees, so how in the hell would the upgrading fees cover the payoffs!? 12DAilyPro makes its money mostly by the advertising agencies private citizens who place there ads on 12DAilyPro for you to watch. So don't go warning people about something, when you don't even know what it is!

4:39 AM  

a golden opinion from Blogger wyejon

anon:

So if it's one layer it's not a pyramid scheme? That's bullshit. Dont' kid yourself.

The risk is NOT very small. The scheme is GUARANTEED to fail. How can it be very small? It's only a matter of time. Sure all investments are risky but this is one that is made to fail (except for the people who control it).

You didn't get the point about upgrade fees covering the 44% profit. Once you understand this concept you can clearly understand why this is an obvious pyramid scheme. Please take some time to actually understand what I wrote. I don't feel like repeating myself here. Here's a clue; it's NOT YOUR upgrade fees that generate your 44% profit.

Please don't bullshit about ads making enough money to cover the profit. I'm not going to do the maths here but off the top of my head advertisers would have to pay BIG MONEY so that 12DailyPro gets sufficient profit to cover its operations.

Now who in their right mind will advertise on paid to read ad channels? It's almost a given that the target audience has no interest whatsoever in the ads.

10:16 AM  

a golden opinion from Blogger Dragon City

Simple math, some rich bastard throw out RM 100 (for sample), so that everyone will invest RM 1 in the scheme, some invest more, pay-off money are from other investor that havent reach the 12days...once the poll had reach RM200, that rich bastard will said bye bye...so if u wanna invest..make sure u gte ur pay-off before the poll reach the max..

10:31 PM  

a golden opinion from Blogger wyejon

Update (4 February 2006):

Since yesterday I've been hearing news about 12DP being in deep trouble. Apparently their payment processor Stormpay is being investigated and have suspended AutoSurf/HYIP related accounts.

As expected the mythical figure Charis Johnson of 12DP makes statements in their forums about how they were screwed over by Stormpay and intend to take legal action.. blah blah blah.

I bet they won't. After all this kind of business tend to work better without legal attention.

Anyways they're now soliciting donations for the purpose of (in their own words) "recovering our funds from Stormpay". Absurd... with the amount of money they have made (all 12DP cheerleaders will tell you 12DP is a flourishing business with lots of money) why can't they pay their own legal bills?

Don't tell me that all their money is in StormPay. If that were true then 12DP is even more stupid than I thought.

6:18 PM  

a golden opinion from Anonymous calm-sky4u

This post has been removed by a blog administrator.

2:16 AM  

a golden opinion from Blogger wyejon

DO NOT LINK TO REFERRALS!

Comment above goes into the dusbtin.

7:52 AM  

a golden opinion from Anonymous Anonymous

12daiypro had been shut down.

3:29 PM  

a golden opinion from Anonymous Alex

anon. is obviously dumb enuf to believe its a single layer. *roffles* these are all pyramid schemes, doomed to collapse one day. the onli ppl profiting? the ones up there.

7:57 PM  

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