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Im finding this article quite interesting and insightful.

I’ve started selling flat advertising how I call it – after Google banned my account, competition webmaster uploaded pornographic content on my social network and reported to google, it wasn’t much to do, all happend in a matter of minutes based on stats. I appealed but they didn’t care that much.

Selling advertising was quite okay, $15-20/banner per mth on a 2000-2500 uniques/day website. Still, you need to get quite good branded or have alot of traffic as you mentioned.

Not sure what’s there to do, except major players like Google Adsense die (as in disappear). I pray!

Already the banner style of advert is not dead or dying but seriously devalued over what it used to be. Used to be a time you could charge hundreds of dollars a day for a large banner – today you’re lucky to get $0.01 per 1000 impressions and personally I don’t buy advertising on any site with less than 100,000 visitors a month. I just don’t find them economical any more.

People see but don’t actually look at banners. They’re everywhere but invisible and even the “I’m a text link rather than an advert, really I am” Google stuff is getting ignored now.

Bottom line, if people are not *buying* on the internet there are very few things worth *advertising* on the internet. That’s the direction we’re heading in so the article does make some strong points.

During the .com boom many sites flourished by giving visitors “free” while selling adverts of yet more sites giving visitors “free”, who in turn sold advertising to other companies trying to give visitors more “free”….

Who was actually buying anything? Very few, so it all crashed.

Now we seem to be repeating history yet again. “It’s free but we’ll sell advertising..” Yeah but to whom? Someone else who wants to sell advertising? We cannot make money just selling adverts to each other – sooner or later, we need customers actually BUYING something.

We’re not just killing the Golden Goose, we’re kicking the corpse around and yelling “victory!”

*sigh*

D.

I have always chosen the FREE business model and the only source of income I could see is Advertising and creating exposure for pay-business models. I’m not sure how good it worked out for them, but they kept repurchasing.

However when a site has hundreds, thousands or even millions of visitors, all of whome expect and demand “free”, WHAT THE HECK IS THE POINT OF ADVERTISING TO THEM!!?

With rising fuel prices buying physical products from across the state or country is uneconomical, even more so internationally. So if I advertise on your site, your only value to me is how many LOCAL (to me or my business) visitors do you get?

Now your “thousands and thousands” of visitors turns into something like “4 a month” or so, and suddenly advertising on your site has zero value to me.

Right now we have a curious situation whereby there are flocks of visitors to ‘free’ places, supported by advertisers for digital products or services – but kill off all value in digital and advertsing on the internet gets very local very quickly. In short, this situation cannot last.

Take sitepoint itself – it ships no products, it’s digital, selling digital services, ie facilitating digital trade between digital sellers and buyers. Already on Sitepoint we see people selling complete websites, not established, just “site in a box” sites, going beyond raw scripts.

Ultimately someone, somewhere, has to pay for all this. If the day comes where we really do consider anything digital to be “free”, then quite literally all this will cease to be.

D

The only companies who can afford to offer high-quality, mass market web services are the likes of Google, Yahoo and Microsoft who can cross subsidize them from other areas of their business. By definition a small business with no income from their free offering will fail. Big companies will dominate and eventually use their monopoly positions to start charging by which time there will be no alternatives.

By the way their are a few other things people will pay for:

1) Exclusivity – e.g. many free forums and niche content websites have a paid member area. People pay to be part of the exclusive membership group

2) Ad-free – e.g. many free website build services place their own ads on the free sites. Customers can pay to have an ad-free site.

3) Speed – e.g share price services give delayed data for free or real-time data for a fee

Ive just launched a share accommodation website and was initially charging $15 for basic ads and $20 for premium ads with photos. 2 weeks in from launch and I have received email after email from people “whinging” that the service should be free. Infact Im so tired of this it makes me wonder where we are headed, or infact if there is any profits to be made online in this type of marketplace at all.

Ive been running online businesses now for 4 years, and it seems that many sites, infact a lot of the big ones too, are moving towards this FREE business model. But seriously, at the end of the day A BUSINESS IS A BUSINESS and needs to be PROFITABLE in order to succeed/survive.

I have a number of direct competitors that offer free share ads and while this may be great for web visitors, where or what is the point in it for the owners if theres no money in it?

Im sure there are other ways (advertising etc) to create revenue, but not all of us want to fill our sites with popups and flashy banner ads.

I think perception plays a big part in the overall issue as well. A lot of end users dont understand the amount of time/effort/money that is invested into an online business at all!

Offering good support and upgrades for payed products makes them more worthwhile too.

I’m looking at buying a new PC right now. I’ve always built my own PCs in the past, but I just don’t feel like going through the hassle this time… I’ll pay more, but I think I’m going to buy an off-the-shelf computer this time.