In February 2006 we attended a presentation hosted by Marcel Gelineault, National Sales Manager of Alpha Multimedia with regards to the Investment Opportunity they where offering with the purchase of their Communication Kiosk.
The investment opportunity was offered as such: when an investor purchased a Communication Kiosk they would have 3 different ways to generate revenue.
First and foremost: Alpha Multimedia was going to secure National Advertising. What this meant was that Alpha had a team of sales representatives that were already going out and trying to get contracts with big corporations to advertise on the investors Kiosks. And we the investors would receive a percentage of the advertising on a monthly basis while Alpha Multimedia kept a portion for their efforts.
At the time of the presentation we had been told that there where a few Corporations that where ready to come on board with the National Advertising campaign Alpha was simply waiting to and I quote: cross the ts and dot the Is.
The National Advertising is the reason why investors would want to purchase the Communication Kiosk / Investment Opportunity! The other revenue possibilities were merely the icing on the cake; people would pay to use the Kiosk to get access to the Internet, to e-mail, play games etc.
And last but not least if an investor wanted to they could go out and secure their own local advertising with small businesses in and around the location of the Kiosk. However, this was totally optional, as some investors had made it quite clear that neither did they have the time nor the desire to start selling advertising!!! They simple wanted a Passive Income from the machines.
One of the things that gave Alpha Multimedia credibility at the time was that they stated in their presentation as well as in their literature was in fact that they had partnered up with Bell Canada. If a huge corporation such as Bell Canada was allowing them to use their name/logo then they must be legit
The cost of each Kiosk was $17, 000 plus $1000 installation plus PST & GST for a total of $ 20, 700. We were told and read in our literature that we would Get your Investment Back in 6 to 8 months.
We bought 2 Kiosks - total investment $41, 400.
Even before our Kiosks where placed in locations I was continually in contact with Marcel Gelineault with regards to the National Advertising campaign As well as after our machines where placed in their locations - constantly asking when can we expect to see some National Advertising on our Kiosks? National Advertising means - more revenue! Exactly what an investor is looking for in a good investment
I was ALWAYS told that there were some BIG companies ready to sign up for the National Advertising OR that once they sold more Kiosks - corporations would be more interested OR that the larger corporations make all there advertising decisions in this or that month, etc., etc.,
After a while it started to become VERY obvious that these where merely lies and excuses!
When we bought our Kiosks we purchased them with a $1000 per machine, per month guaranteed revenue for 12 months. The machines where to be place in Petro Canadas, however we were advised that the Petro Canada Campaign fell through and that Alpha Multimedia would have to find alternative locations but Alpha Multimedia would honor the agreement with regards to the $1000 per machine per month revenue. Less of course the monthly expenses (rent, DSL line) we ended up netting approx. $550. per month, per machine.
At this rate, were definitely NOT going to recover our investment in 6 8 months; as we had been told.
In February 2007 one year after purchasing our kiosks and our one year of guaranteed revenue coming to an end within a few months and no other National Advertising on our machines we had decided that this investment opportunity was not what we had been told and sold.
To try and make a long story shorter I contacted Marcel Gelineault and asked him if Alpha Multimedia would help us sell our Kiosks for a fee of course. He told me that they would and to work with Brian from Customer Service. I spoke to Brian several times over many months but to no avail. Brian did tell me that Alpha had discussed just buying our machines back from us and they would upgrade them to the NEW 3D screens and re-sell them.
In the mean-time, we took a drive to our Kiosk in Windsor, ON (4 hours from where we live) to empty the Kiosk. When we arrived at the Comfort Inn we see a very poor quality Visa Ad running on it. We had not signed an agreement for this advertising. We had been told by Alpha Multimedia that before any ads would go on our Kiosk we would have to sign an agreement. We had not received an agreement nor have we received a dime in revenue for this ad.
Then when we arrived at our 2nd kiosk in the Holiday Inn Select in Oakville, ON sure enough there was the poor quality Visa Ad running as well as several radio station ads. Again, we had not signed any agreement nor have we received a dime in revenue.
To this day, I have not received any explanation as to why we have not received any money for these ads running on our machines.
The internet use that the machines are receiving is a far cry from what Alphas literature had promised;
Internet approx. $1080 per month
Wi Fi $1080 per month
Games $ 90 per month
For a total of $2, 250 per month! We are averaging $35.00 per month per machine for that last 17 months!
On May 18, 2007 we received a letter from Mark Singh Director Sales & Marketing telling us that our current advertisement contracts expired on April 30, 2007 with the intent to be renewed on Sept 1, 2007. As a part of extra service we will still pursue more national or local advertising on all of your kiosks which will ensure financial coverage of your minimum monthly expenses. As this is your business we would like to see your participation in the mean time to secure local advertising contracts. This will ensure your own business success as well.
For that past year, I was an INVESTOR and NOW Im a BUSINESSOWNER! A business owner who is supposes to sell advertising??!! If we had been told this up front at the presentation, we WOULD NOT HAVE BOUGHT THESE KIOSKS! Not to mention that we would not have agreed to have our Kiosks placed 1 and 4 hours away from where we live
When Alpha Multimedia did eventually make us an offer to buy back our machines the offer was ridiculous. We would have taken a loss of more than $15, 000!!!
After many months of BS and no returned phone calls, emails I filed a complaint with the Better Business Bureau on July 24, 2007 I received a phone call that day from Marcel telling me how disappointing he was in me??!! He told me that I had made a 40% ROI and why did I want to sell my machines? He then offered me the same ridiculous offer. While I was trying to figure out with him how he came to the figures he did he couldnt explain some of it and became very agitated and told me to email him my numbers and he would be back to me in a couple of days and hung up.
I tried endlessly to get some response from him but nothing!
Alpha finally responded to my BBB complaint. They basically said that they have kept all their promises and obligations. They had decided to help us out with advertising for one year and that it was our responsibility to run our business (i.e. sell local advertising) as well as our responsibility to remove the ads (the ads that we had NOT given permission for, received no money for and had certainly not placed them on our machines BUT NOW it was our responsibility to remove them??!!)
The BBB suggested that I take it to Arbitration and so I agreed. Two days later Alpha responded again that because I have spoken to potential customers and told them the truth about Alpha Multimedia and they lost sales they are considering legal action against me
RECAP:
We have owned 2 Kiosks for more than 20 months - they are not even close to being paid off. Never mind the 6 to 8 months we had been promised.
We have NO National Advertising on our machines even though we received a letter from Mark Singh telling us that the advertising campaign will begin in Sept /07.
Our machines are to far away to even try to go out and sell local advertising even if we wanted to. Which if we had known this we would NOT HAVE BOUGHT THEM!
We have had National Advertising on our machines without our permission and NOT RECEIVING ANY REVENUE!
We still have not received any money for the credit card payments that have been made on our machines although we have asked several times. Approx. $100.
I have been accused by Alpha Multimedia of defamation. However, all I have done is told the truth of my own personal experience with Alpha Multimedia with the purchase of their Investment Opportunity / Communication Kiosks and I have a growing file of people who are in either the same situation as myself or in some cases much worse off.
Perhaps its time to take this further than just the BBB and complaint. Its time to go to the newspapers and shows like W-5 and Markeplace. They are always looking for companies who are out to scam people out of their money.
Doreen
Orangeville, Ontario
Canada
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