I first heard about BurnLounge earlier this year and have since heard a little more about them.  They want to be the Amway of digital music -- have armies of music fans and entrepreneures set up their own digital music stores and make money selling digital music for which they receive a commission.  BurnLounge takes care of all of the backoffice functions.  Everybody makes money.

Ah, but there's a catch.  There are 3 tiers of membership.  Regardless of the tier, you need to pay a $29.95 setup fee.  The first tier lets you merchandise your own store and you earn points for sales that are made that you can use to 'buy' products and services.  The next 2 tiers enable you to earn money from your sales as well as the people you sign up under you.  These tiers require monthly maintenance fees and the top tier requires additional upfront fees to become a "Mogul".  However, once you become a Mogul, you earn money from the other "Retailers" you sign up.

I'm not going to delve into the details because there seem to be a few sites with forums for discussing the pros and cons of BurnLounge.  From what I've seen, the way to make money is by signing other people up that pay their fees, not by selling music downloads, which we all know has very little margin for anyone not doing milions in volume to make money on.

My advice:  Caveat emptor.

Others have written about BurnLounge (with reservation) here: http://netmix.com/wordpress/burnloungecom-launches-viral-marketing-effort-in-new-york-city/"

...and here: http://www.indiemusician.com/music_business/2006/02/burnlounge_ponz.html