SiteTalk and OPN to target US market?
When we last checked in with SiteTalk, they’d ditched the Unaico name and reinvented themselves as “The Opportunity Network”. Both The Opportunity Network (OPN) and SiteTalk are still chugging along today, with news from the company last month indicating a new push into the US market.
If you’re wondering why SiteTalk had previously abstained from the US market, CEO Frank Ricketts explained the situation earlier this year at a SiteTalk event. Ricketts revealed that three years ago he ‘blocked the USA market for the OPN business opportunity:
We are a scam, we are illegal, we are running a pyramid system everywhere around the world. You can read that in Google.
So if we are a scam, we’re a pyramid, we’re illegal – what’s the problem with not being in North America? Why not do this in North America as well?
The reason is because one aspect of our business, that our legal adviser said that the authorities would probably say it’s 70% ok, but 30% maybe not.
And in the most important market in the planet, we decided that that risk was too high.
When I reviewed The Opportunity Network in late 2013, I identified a complete lack of retail activity within the business. It’s likely that 100% of the commissions being paid out of affiliate money is the root problem of the “30%” Rickett’s mentions above.
Another potential red-flag is the virtual stock exchange SiteTalk ran under their Unaico brand. Early investors were promised shares in a SiteTalk IPO, which eventually manifested itself as a listing on the Cyprus Stock Exchange’s “Emerging Companies Market”.
SiteTalk is listed under the stock code “STC” and company name “Global Digital Systems PLC”, with a current share price of €0.248 EUR per share.
In any case SiteTalk has persisted and appear to have gained a significant following in China of all places. At the time of publication Alexa estimate that 37% of SiteTalk traffic originates from China, and ranks SiteTalk as the 648th most visited site in the country.
Evidently though being popular in China hasn’t reaped the economic rewards SiteTalk’s owners might have previously thought it would.
A “statement of comprehensive income” filed on March 31st 2014 reveals SiteTalk generated €723,553 EUR in revenue. That sounds alright until you consider “sales” and “other expenses” during the same period set SiteTalk back €3,816,365 EUR.
The end-result is a 19th December 2012 to 30th September 2013 net loss of €3,092,812 EUR.
Obviously not looking for a repeat performance this year, this is likely to the be primary reason for SiteTalk’s recent push to enter the US market. Currently the percentage of US traffic visiting SiteTalk is so insignificantly low that Alexa do not track it. The smallest recorded percentage by country is Venezuela, who account for 0.5% of SiteTalk’s global traffic.
Nonetheless earlier this year, via a series of press-releases, SiteTalk announced to the world its plans for the US.
This began with the launch of SiteTalk Music in January,
SiteTalk Music is a music streaming service that will allow SiteTalk Members to stream any of approximately 20 million music titles directly from SiteTalk.com, for a flat monthly fee of €9.95 (or the equivalent in other countries).
“This is an incredible, modern music streaming service that will allow our Members to access a vast collection of titles, anytime, anywhere they happen to be using SiteTalk,” said Managing Director Frank Ricketts.
“Whether your taste is Lady Gaga, Led Zeppelin or Lena Andersson, we’ll have it at SiteTalk Music. It’s a fantastic collection.”
Then, on the 6th of February, SiteTalk announced it had signed a memorandum of understanding with Imogo Mobile Technologies:
SiteTalk has entered into an MOU with US technology development company Imogo Mobile Technologies. Once the definitive agreement is finalized, Imogo will become an integral part of SiteTalk’s global growth plan.
The partnership will grant Imogo license rights for the United States marketing and distribution of SiteTalk. The agreement may also include licensing of the brand name, domain name, goodwill, technology, code and intellectual property developed and associated with SiteTalk.
The Definitive Agreement is expected to be signed on or before May 2, 2014, subject to legal due diligence by Imogo’s legal counsel and Imogo obtaining all requisite internal corporate approvals (which shall include a shareholder approval by Imogo).
“Imogo is very excited about joining forces with SiteTalk,” said Imogo President and Founder, Stewart Irvine. “Together, we can take this unique Social and Business Networking Platform to a global stage.”
A month later, Stewart Irvine was appointed to the SiteTalk Board of Directors:
Mr. Irvine has a distinguished career as a leader and innovator in the mobile technology, e-commerce and computing industries. He is the founder and CEO of Imogo Mobile Technology and Go-Page, two exciting players in mobile and cloud computing sectors.
In addition to the revamping of the SiteTalk website and company app (both to be released later this year and presumably developed by Imogo), the “gimmick”, as Ricketts described it in his Slovenia presentation, SiteTalk are hoping to lure US users of SiteTalk in with is their “Star Club”.
Star Club is SiteTalk’s loyalty reward program, which rewards participating Members for their activities on SiteTalk.com. SiteTalk is the only Social Networking Platform with a loyalty reward program that truly rewards Members for their activities and time spent on the website.
If I didn’t know any better, I’d suggest this “loyalty program” is what resulted in SiteTalk’s “sales” losses for the period 2012 – 2013. Otherwise I’m at a loss as to how company sales can result in a €2 million EUR expense.
The basic idea behind the Star Club is that users of SiteTalk are rewarded points for doing stuff on the SiteTalk network, for a price:
Members will have the option to purchase a Junior Star Club membership for a monthly subscription of €15 in addition to the full €35 Senior Star Club Membership program.
The Star Club system allows all SiteTalk Members to accumulate points for various activities at SiteTalk. Points can be earned for one-time activities like signing up and completing a user profile.
Members can earn continuous activity points also, simply by being active on the SiteTalk website.
Once they’ve got Star Club points,
Star Club Members’ accumulated points may be redeemed for SiteTalk “C” credits that can be used for purchasing SiteTalk Deals, SiteTalk Bids, playing SiteTalk Games, for sending virtual gifts to friends, and more.
And of course note that
Users must log in at least once in any 28 day period, or their points and credits will expire.
Putting two and two together, the general thrust of the concept seems to be to continue to pump SiteTalk investor funds into the plan, and hope that eventually the point activity will translate over into real revenue for the company.
Sort of like, “hey here’s some points to play around with” and then having users return to spend actual money.
While I’ll try to keep up with how SiteTalk’s planned US expansion goes over the course of the year, my prediction remains practically unchanged from when I first reviewed Unaico back in April 2011:
The main problem I see it with Unaico/SiteTalk’s business model of combining all these additional features with a social network is that the people using the network are in it for the money, as opposed to socially connected with eachother.
As it stands now, you have early investors who are hoping to see a return on their Cyprus shares, The Opportunity Network affiliates who are hoping to generate commissions via the company’s MLM business opportunity, and lastly SiteTalk users that are purely there for the love of the site itself.
The problem is that last category has failed to materialize in any significant number for nearly half a decade now.
When it comes to MLM social network companies, the inevitable comparisons to Facebook are usually hovering around. And it’s these comparisons (“Facebook doesn’t pay you” rah rah rah etc.) that perfectly explain why no MLM social network company has thus far gained any traction.
People use Facebook because of what the site offers, and because when it popped up – there was no other site like it. As close as SiteTalk might get itself to Facebook clone status, at the end of the day imitation is not innovation.
I’ve seen some pretty big numbers (15 million) attached to SiteTalk social network membership, and with 37% of the company’s traffic originating out of China, I’m not disputing SiteTalk might be providing a legitimately innovative user-experience there.
But guess what’s not available in China? Facebook.
That’s the thing about running an online business in China. Initially you have a leg-up due to the restrictive nature of the market. That is of course until you start to demonstrate some real profitability and a workable business model.
Then some business tycoon, backed by the Chinese government *wink wink, nudge nudge*, launches its own competitor (RenRen in the case of Facebook), and that’s the end of you.
Oh and should SiteTalk take off in the US (or gain even the slightest traction), I’m not sure how that’s going to play off with their Chinese userbase. Chinese authorities generally frown upon any social platform that allows their populace to interact with Americans directly.
So either SiteTalk are going to have to kowtow to Chinese censorship rules (if they haven’t already, and which will kill the site in the US), or shut out their Chinese users.
At 37% of the company’s current user-base (not sure what the percentage of revenue is), that’s a pretty big gamble either way. Especially considering the historical statistics of MLM social networks.
Ultimately SiteTalk, due to its Unaico history, is always going to find itself trying to deliver value to its shareholders and OPN affiliates first, leaving non-affiliate end-users second. Unfortunately that means all you end up with is yet another MLM social network filled with affiliates – and they’re trying to make money, not spend it.
As I understand it the virtual shares component of Unaico is no longer open to the general public (meaning it’s a closed club of early affiliates). That’s always going to be an issue but if they’ve truly cleaned up the more problematic components of OPN’s compensation plan, then let’s see how this plans out.
With millions of EUR in investment funds up in the air and corporate agreements in place to push the mobile aspects of SiteTalk, they probably have the best shot at making something with an MLM social network yet.
Footnote: The presentation Frank Ricketts gave at a “SiteTalk Day” earlier this year can be viewed in full over at Vimeo (restrictions implemented by the uploader prohibit me from embedding the video here directly).
They may have changed a lot since I checked UNAICO / SiteTalk / etc. in 2010 / 2011, but SiteTalk was a feeder program for the opportunity, “free to join, earn reward points”.
UNAICO was a pyramid scheme style “member club”, a pay to play part of the concept. “If you want to withdraw points as cash, then you must first purchase the UNAICO membership package”.
Membership packages contained a Towah or similar account with a prepaid debit card, plus AdCredits that could be used to buy leads internally (leads = SiteTalk members, not yet registered as UNAICO members).
SiteTalk memberbase has been sold or rented out to other companies as a fake asset, e.g. to Enwire AB (reviewed here) and CellPoint Connect AB = 2 Swedish companies in the same group. Fake assets can be used to manipulate the stock price, and SiteTalk was also used for that purpose in 2013 (May – unknown date).
If people want to get involved in a scam, SiteTalk is clearly an option. It was popular in Bangladesh, Pakistan and some eastern European countries, but that’s long time ago.
China aside, the European bloc is still where the bulk of SiteTalk’s users are. I think this is where the majority of their OPN shareholders are based out of too.
It’s kind of like they’re expecting US users to use the site not for the same reasons their core users do (share returns).
Cellpoint Connect AB was delisted from the Swedish stock exchange Aktietorget.se January 24 2014.
It was temporary delisted in 2013 too, but this time it seems to be more permanent. The stock exchange has concluded a probe or something.
If people really want to engage in investment scams, SiteTalk can probably be an option.
You can’t look at Alexa statistics for programs like SiteTalk. They pay people in different countries to generate a lot of fake traffic to simulate real user activities, e.g. 4 million users only generated negative revenue when Cellpoint Connect owned it through Enwire AB.
They also pay people to “talk the stock price up” in local investor forums. I checked the local Swedish Avanza forum in 2013 for that type of activity. A couple of people posting positive posts each day should usually be enough. That particular activity was related to Cellpoint Connect AB, but SiteTalk’s memberbase was indirectly a part of that company’s assets.
Both network marketing and the investment market have a lot of “low hanging fruits”.
For anyone interested, here’s a thread (in Norwegian) about Cellpoint Connect AB and related companies, trade names, etc. from June 2013.
It’s posted in the local Norwegian pyramid scheme forum, a relatively inactive forum after July 2012.
SiteTalk members may potentially be exposed to investment offers / membership in investment clubs / other investment related offers.
It’s about the network marketing version = you won’t get rich by the investment itself, the idea is to sell the investment to some “low hanging fruits” / “Greater Fools”.
Thanks for the helpful article. Having been involved in MLM social networks for a few years there are some valid points especially about the need for genuine non MLM users/spenders if any platform is to succeed long term. True social networking needs to be attractive.
I doubt that Frank Ricketts was openly confessing that OPN is an illegal scam. The context is clearly what many have been saying about it!
Lastly I think it important to make clear to readers that Enwire/Cellpoint Connect (or Viral Angels that has been written about in the same Unaico/Sitetalk/OPN context has NO, and never has had ANY contractural,investment or ownership connection in any way.
Any connection is simply due to individuals residing in the relatively small space and networking community of Scandinavia. Some members of the similar MLM social media experiment, Spinglo, and another emerging revenue model Trig.com migrated to Sitealk/OPN at the end of 2013.
Comments by M_Norway are not factual and misleading.
You must point out the specific part(s) if you want me to correct it?
Note that I have not talked about contractual agreements, I have focused on whether or not SiteTalk has been USED or INVOLVED in fraudulent investment offers.
OPN’s “footprint” on the internet is relatively small and insignificant after May 2012 / September 2012 (rename and reboot).
The 15 million Chinese SiteTalk users are probably fake. SiteTalk has been used in fraudulent investment offers, and a fake userbase can be presented as a valuable asset in presentations to investors.
The Alexa rank is probably fake too. “Low hanging fruits” will accept statistics like that when looking at investments, they will look at POSITIVE information rather than important one.
Both those arguments, “Alexa rank” and “member base”, were used to pump up the share price for Cellpoint Connect AB in the Swedish Avanza forum in May/June 2013.
It is interesting that when you go to “Unaico.com” it takes you to a language button. When you click it, you are forwarded to iis.net, a division of Microsoft. 🙂
I think that’s the default server screen for IIS, which is a MS web hosting platform.
Unaico was abandoned and they’ve just left it showing a diagnostic page.
Frank Ricketts, who fled from OneCoin to Aulives, announces changes to SiteTalk:
New name = AuLives?
I can’t see Ricketts devoting time to two companies.