You may have spotted the little 'From the Blogosphere' widget that I recently put on the sidebar. The service is called Blogrush, and it has attracted a fair amount of attention in the blogosphere. Here's more, from their site(emphasis mine):
BlogRush is a "Cooperative Syndication Network." It's a network of blogs that run a small "widget" on their pages. Each time this widget is loaded it will contain 5 clickable headlines which are the blog post titles to other users' posts. Clicking on any of these links will open a new browser window and load the blog and full post. Users earn "syndication credits" based on each time their blog loads the widget as well as each time any of their referrals (users that signup after clicking the "add your blog posts" link on the widget) loads the widget. They also earn additional credit based on all the activity through 10 generations of referrals. 1 Syndication Credit = having one of their recent blog post titles served inside the widget on another member's blog.
Blogrush has been labelled a pyramid scheme by many in the blogosphere - and it is. This, in itself, is not a problem: if you are offered a deal and you accept it, it must make sense to you. Furthermore, there's no real money at stake, and you can choose to remove the widget from your site any time you please.
What I'm pissed off about is that they make an incredible commitment (that is, they lie) about the conversion rate from pageviews on your site to links to your site from widgets in other blogs. The total number of pageviews in the system (i.e. the number of 'syndication credits' of all members) will never be equal to the total number of pageviews times 5 (remember, each widget displays five links). In the absence of the referral system, the conversion rate from your own pageviews to links to your site should be 1 to 5. (the FAQ does not specify what happens with excess link spots: they post paid-for ads perhaps? The quoted piece refers to '5 clickable headlines which are the blog post titles to other users' posts') With the referral system, this conversion rate can only be higher and it is likely that it will go beyond 1 to 1 before long, so Blogrush will simply not be able to deliver on their commitments. Also, it is very unlikely that they are not aware of the math behind this: after all, they put bloody link allocation algorithm together.
To cut a long story short, I don't mind that blogrush is unlikely to be a good source of traffic (what most bloggers tend to complain about), but I am angry that they blatantly lie about the terms in the deal - which is probably illegal too.