How To Generate Passive Incomes Over The Internet

The first phase of my Internet business adventure is to explore potential opportunities - knowing what marketplaces are out there and what tools are at my disposal. Since my primary interest is to produce passive incomes, I have excluded ideas like selling on eBay or Amazon. My goal is to continue my income streams, even when I am not at work actively.

As discussed in this post, there are several ways to generate passive incomes over the Internet. Although mechanisms vary, the bottom line of all this is content - the King of the Internet. Income is generated by traffic to your sites or pages, and traffic is generated by the content you produce. Knowing this, my job is to keep producing content - the kind of content that produces passive incomes. I discuss a few types of them below for your overview.

There are many types of royalty-based content; for example, books, photos, articles, paintings, images, video clips, and so on. You can protect your contents via copyright or trademarks. You then claim royalties, when people use them or a copy of them. To produce passive income, though, you want to avoid handling orders from customers and shipping the products yourself.

There are many content sites that can store your contents, but not all of them enable you to profit from them. For example, you can place video clips to YouTube, but you do not make a profit, when people view it. Luckily, some content sites have done all the hard works and all you have to do is to produce the content for them - which is what you are good at. Advantages of this approach include that the sites handles orders, production, and shipping for you and that there is already crowds looking for you.

Here are some examples of these sites: Istockphotos is a popular market place where people look and shop for the pictures others have produced. CafePress and Zazzle are marketplaces where people shops for T-shirts, mugs, gifts, and many other things with pictures or graphics designed by artists. Lulu.com is a marketplace for self-published books, music, and videos, while Etsy.com is for things handmade.

Many Internet surfers are looking for insightful information to help make a wise decision for their next purchase or how-to for doing certain things. If you are an expert in doing certain things or domains, this is an opportunity for you to publish your knowledge or share your ideas. Surfers typically do not directly pay for informational content, but indirectly via clicking on the advertisements or affiliates.

This easiest way to set up your sites for information content you produce is perhaps blogging. A blog is like a journal in which you publish informational content. You can start your own blog immediately, after opening an account with popular blog sites, such as, Blogger, TypePad, or WordPress. You will have to do affiliates and place ads on your blogs as well as conduct promotions to get traffic to your blogs. I will discuss how to do this in other posts.

Luckily, there are also content sites that have already attracted huge crowd looking for your new content; such as, eHow, Squidoo, and HubPages. All these sites provide cash incentive back to the authors based on various factors, such as, the number of readers and usefulness of the writings. You can read my other post for details on this subject.

I consider software application a special kind of content. Traditionally, application developers build the application off-line and deploy it to public on their production web server. Thanks to Web 2.0, the paradigm is now shifting towards on-line development. The most successful vendor in this frontier is salesforce.com. Through its subsidiary force.com, the company provides not only the tools (as well as the infrastructure to host the application) to build the business applications, but also the market place, namely, AppExchange. Application developers use the tool for development and testing and publish their application to the market place, when it is ready. Customers of salesforce.com can browse or look up the available applications in the market place and install those that suit their needs on-demand. Application vendors can either make their applications free or charge certain subscription fees based on the number of licenses and duration. The profit is split between the application vendor and salesforce.com who makes this all possible.

Be aware that the customers of this type of applications are not regular consumers who browse and shop on the Internet. The customers of salesforce.com are enterprises or business of various sizes that demand both complexity and quality of the application. It is therefore not surprising that developers of this category must clearly understand business needs of their customers and equip certain level of programming skills. It is, though, considered easier and less time-consuming compared to traditional application development using C, C++, C#, or Java.

Having seen such a wide verity of market places, you may feel lost and start wondering where to start. By now, you should understand each category discussed above requires different skill sets. It is important that you understand your talents as well as passions. Here are some questions to help you figure that out:

1. What are you talents? 2. What are your passions? 3. What are your skill sets? Or, can you afford to hire someone to do it? 4. Which market sectors or domains do you know the best?

While trying to answer these questions, please also keep in mind that it is important to leverage other people. They can be your family, your close friends, your co-workers, or even hire someone, if you can afford it.