Aside from adult sites, which have always been profitable, it has become increasingly difficult to make money on the Web. Business models that burst upon the scene with great bravado and gusto now lie discarded in the grass, their bones baking in the sun, the stink of death warning others away. Feeble attempts to replace these models with banner ads and pop-up interruptions gain little headway and embarrass those of us who have realized that annoying people is usually a bad way to get return business.
So how will the Web survive? If there's no money to be made, is the Internet doomed to join the eight-track tape and the beta video format? How will state agencies recoup the costs of putting their services online if no one is willing to pay?
Well, there is money to be made. Quite a lot of it, really. And you don't have to annoy anyone to get at it.
Currently, one of the most common ways to do business on the Web is through subscription fees. The problem with subscription fees is they tend to be an all-or-nothing proposition. You pay for all the services under that fee; or you don't, and you get, well, nothing. Users usually aren't allowed to sample the product, and the investment process can often be too intimidating to warrant what a user may get in return. Subscription fees are also the exact opposite of what the Web is all about: freedom of information. Subscription fees limit one's access to information the same way a roadblock limits access to a road. If you aren't willing to pay a large fee up front, you aren't going anywhere.
Another recent trend in trying to squeeze money out of the Web is charging convenience fees for government services. This appeals to government agencies because not only do they save money, but they make a little extra in the process. However in most cases, users again find themselves annoyed, especially once they become more Internet-savvy and realize an agency saves money by Web-enabling its services. Why pay more to save the agency money? Granted, there are a few situations where being able to do business with the state from the comfort of the home is worth an extra dollar, but these exceptions are few and depend heavily on the state's demographics and infrastructure.
So where is the money, and how do you get it? The future of profitability on the Web lies in micropayments. With micropayments a user registers a credit card once, and every time the user accesses valued content, a tiny fee is deducted from the prepayment. A visit to the online reference section of a state library, and the user's account is debited 1 cent. A visit to the address change section of the Department of Motor Vehicles site, and the user is debited another cent. It may not sound like much, but for sites that generate high traffic and receive a lot of repeat visits - like many of those operated by government agencies - those pennies quickly add up to a chunk of change.
How much? Let's take my favorite state government site as an example, the commonwealth of Virginia portal
Instead of a few people paying for it in huge and painful chunks, thousands of users pay for it in miniscule pinpricks they hardly notice. It's better than taxes: You may never use the services your