Milesource Closing After Nearly 8 Years in Business

December 6, 2007 · 0 comments

When I began putting together my annual shopping rebates comparison this year, I made the decision to eliminate Milesource from the chart. It had been ranked last or second-to-last in my comparisons for 2004, 2005, and 2006. Its Alexa traffic ranking had dropped by 240,000 in August compared to a year prior, and if hadn’t been for its free daily trivia points, it wouldn’t have been that high. The site was not even listed by its parent company, SilverCarrot, as one of their owned properties (making Milesource, I guess you could say, “disowned.” How sad is it when your owner no longer wants to claim association with you?). Once a real player in the rewards program scene, Milesource was clearly a hollow shell of its former glory.

On 11/30, Milesource posted a news item dated 11/29, in which they announced that they were indeed shutting down. Members will be allowed to earn rewards through December 31st, and they’ll have until 11/30/08 to redeem them. They will be enforcing a clause in their Terms of Service that stipulates that unredeemed miles earned prior to 1/1/06 will be removed from your account as of 12/31/07.

Basically, earn what you can by the end of the year and cash out by 12/31 if you’re not sure how long the points have been in your account. The cheapest redemptions start at 2500 points (for merchandise or for a $5 SuperCertificate).
Milesource had a long run, launched in February of 2000 (here‘s what the site looked like back then, courtesy of WaybackMachine, and here is an interesting blog entry written by a new intern in June 2000). I joined the site in October 2000. Milesource was founded by Chris Heintz and Paul Fino, who called their company Mass Medium. In May of 2001, Milesource was ranked in the top 300 most visited websites, with members spending more time on the site than at competitors like MyPoints, and it reported its first profitable quarter while MyPoints reported a continued loss. In August 2002, Adweek reported that Milesource was sold by MassMedium to SilverCarrot, and at the time it had 1.2 million members and a staff of four. (Co-founder Heintz claims that it had 25 employees and $5 million in revenue.)

Milesource wasn’t properly supported by SilverCarrot, who handed off operations last year to its Ampere Media subsidiary, as I reported here. Despite promises by Ampere to revitalize the program, Milesource has become the digital equivalent of a ghost town.

Why did SilverCarrot discontinue Milesource? Just this year, Inc. Magazine named SilverCarrot to its annual list of the 5000 fastest growing private companies in America, citing 2006 revenue of $27.5 million, versus $3.5 million in 2003. Obviously that growth had little or nothing to do with Milesource. The Inc. article says that Recipe4Living, one of SilverCarrot’s other sites, is one of the ten most-visited recipe sites. I read somewhere that they have a million subscribers.

Regardless of the probably-sound business reasons behind the decision to discontinue Milesource, it’s always sad to see a long-time rewards program go under. Milesource is directing its members to InboxDollars, but it doesn’t appear that InboxDollars bought Milesource — maybe SilverCarrot is just trying to earn their last couple of bucks by referring members to InboxDollars for the standard referral bonus.

Sorry to see you go, Milesource. So much potential…squandered.

If you’re a Milesource member and you’re looking for similar alternatives, you may also want to try out where, similar to Milesource’s MileBuilder, you can earn for visiting websites and for playing games (like trivia and Guess My Number), and for shopping or completing offers…plus you don’t have to wait a ridiculous length of time to receive your reward (get PayPal or Amazon within 24-48 hours of requesting it).

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