But big internet sites, driven by advertising to win web visitors, are losing out, the survey showed. The survey by US internet research group ActivMedia Research found 54 per cent of online businesses are already profitable, despite the highly publicised failures and money-losing operations. The sites that actually turn out to be the real body of the Web are more humble, they're not trying to conquer the world. The study was based on a survey of 500 English-language websites around the world earlier this year seen as a representative sample of online sites. The survey indicates that 66 per cent are intended to make a profit, while the remainder are aimed at other purposes such as promotion or cost reduction.
Online losers try to capture markets through aggressive promotion and pricing alone.
Online winners garner increasing loyalty among customers willing to pay for strong service, while the losers suffer from lack of margins that inhibit the ability to compete in the service dimension, where it really counts. A website actively sought out by millions, the music site Napster, transformed itself from recording industry pariah to partner overnight. The music service signed a licensing deal with MusicNet that grants it the right to distribute major-label songs to subscribers when it launches its paid service in coming months. The deal would give Napster access to the same musical catalogue offered subscribers of America Online or RealNetworks. MusicNet, a music clearinghouse to license downloadable and streamed music online, was formed in April by RealNetworks and recording labels AOL Time Warner, Bertelsmann AG and EMI Group.