O ne of the factors most commonly cited when Internet firms succeed is the “business model.” Much of the success of such e-commerce pio- neers as Dell, Amazon, and eBay has been attributed to their novel Internet business models. And one of the first questions in assessing any new e-commerce venture dur- ing the Internet boom was likely to be, “What’s the busi- ness model?” Conversely, when high-profile businesses like Boo.com have failed, this too has often been blamed on the model. Post-crash, however, the sentiment has changed and the question increasingly being asked now is, “Hasn’t that model been tried and failed?” Many in the e-business investment community commonly assume that none of the following are profitable: e-tail, portals, and market- place models; advertising-based models; B2C models; and pure Internet, or pure-play, models. However, despite the frequency of these statements in the business press, little research has been done to examine their validity. In retrospect, it is easy to blame all e-busi- ness failures on a flawed model, but identifying what makes a good model is more difficult. Although the term “e-business model” is widely used, there is little consensus on what it actually means. Many schemes have been suggested for classifying different types of e-businesses; see the previous article in this issue for an example. However, a workable definition is pro- vided by Timmers (1998): “an architecture for the prod- uct, service and information flows, including the various business actors and their roles; a description of the poten- tial benefits for the various business actors; and a descrip- tion of the sources of revenues.” Depending on the classi- fication scheme, as many as 29 Internet business models currently in use have been described by various authors. However, according to Mahadevan (2000) and Weill and Vitale (2001), there are four key distinctions: (1) the sup- ply chain model; (2) the revenue model; (3) whether the model serves the business or consumer market; and (4) whether the firm is pure-play or clicks-and-mortar. New e-technologies such as mobile Internet phones and interactive television are widely predicted to generate a wealth of opportunities through the creation of new e-business models. At the same time, numerous high-profile Internet ventures have gone belly-up and millions of investors around the world have been caught out. A focus on the successes can give the impression that an ingenious business model is all that is needed to create a thriving e-firm. But do these models really matter? What can we learn by examining the Internet failures, or the problems inherent in each model? What are the real key factors determining the survival or failure of e-firms? 27 Stephen Chen Visiting Fellow, National Graduate School of Management, Australian National University, Canberra, Australia (stephen.chen@anu.edu.au) The real value of “e-business models”