Making internet money
I have never focused on making my blog profitable. (Rarely do I invest enough time to spell correctly) But as my budget tightens, I may try a little harder.
The first step is to get traffic to your site. I think the key to doing this is to say interesting things. If you want traffic, it is also wise to fill in the keywords section of your blogging software if it is available. I believe you get better attention from search engines if your blog is at the base of your domain. i.e. http://www.fingertoe.com Not http://www.fingertoe.com/jreighley/blog/ I am not certain about this, but It seems to hold true for my sites. You can do a ton of search engine optimization if you want, but I would start with the basics. Make sure that the words that people might be searching for are in your post.
I use google sitemap on this blog, and it seems to help them find my webpages. Basically you add a template to your Movable type Installation that generates a sitemap.xml file for google, so it knows what to look for on your webpage.
I believe that what makes the internet so outstanding, is that it serves markets that are too niche for traditional media to reach. It fills the role that magazines served in the past, but is more responsive, not having to wait for a publishing cycle to get information to the audience. As such, generally the audience of a webpage is going to have pretty narrow interests, and it is fairly easy to sell them stuff. For example people who search for and find a page about building bat houses are very likely to want to know how to build a bat house. If you can point them to a inexpensive resource that will help them do it, they are quite likely to check it out. If someone is searching for methods to solve sudoku puzzles, and they see an ad for how to solve sudoku puzzles, then they are fairly likely to check it out.
Amazon.com's associate's program is pretty effective for this. Basically you sign up and include your associates code in URL's linking to any page on Amazon.com's website. Anytime somebody follows one of your links, you get a commision on anything that they purchase. I prefer to use a simple text link when possible. If it looks like an ad, you lose credibility. If your content is really compelling, then your audience will want to explore more.
Google's adsense is also quite effective because they often serve ads that are quite relevant to your blog entry. I only include these ads on my individual entry pages, as I think that the topics on my blog are too diverse to draw the right niche. If I ran a Niche topic blog about VoIP or Asterisk or the like, I would be more inclined to put Ads on my frontpage. Unless they are relevant, Ads are annoying.
There are folks who make a living off of their blogs. I never expect or intend to do that. It would be nice to offset some of the costs however. I spend about 20 bucks per month on internet hosting, plus 55 bucks per month for High speed access. Based on my past experiences I am quite confident that enough revenue could be generated to offset a good chunk of that.