Entrepreneurs are hopeful that sooner or later the industry dynamics will shift to allow web services to overcome the difficulties in putting together a business model and some have already started to prepare themselves. Companies like Santra in Vancouver, B.C. and Salcentral of the U.K. have already launched value-added services for Web Services.

Software companies will eventually send their software application to the Web services registry, the universal description, discovery and integration (UDDI), which acts as a sort of Yellow Pages of applications. An business looking for a Web services tool will then search through the UDDI for the services it wants.

Santra has created a service, called iON, that monitors and measures the performance of web services found on the UDDI. There are currently about 430 web services on Santra's iON system. "As more developers get into the market, they'll be able to see this is the way to go. The database can be centrally stored and integration with different systems is a cinch," said Robert Chartier, vice president of technology at Santra.

Salcentra takes its UDDI value-added service one step further. Co-founder Mike Clark refers to his service as a web services marketplace that not only monitors downtime but also brokers web services. "For a developer of web services, he can go there and promote it. For the user, he can go there and buy," Clark explained.

Both Clark and Chartier get their listings by spidering the UDDI, creating relatively low barriers-to-entry for another player to jump into the market with a superior offering. But through his own research, Clark has discovered an open door: UDDI doesn't police its listings of web services.

"48% of the production UDDI registry has links that are unusable. These pointers contain missing, broken or inaccurate information," Clark wrote recently in an online trade publication.

But exactly how does that software developer make money from customers who pick up the application for their business? Do they charge by the month, per customer or something else entirely? What does that software company do when another, much larger software company, signs on as a reseller affiliate and bundles that application with their own package of applications?

"The business models have not been completely worked out yet, though the promise is so amazing that the business models will have to come about (to accommodate it)," Hoch said. "We've now got to take it to the next step and put those standards to use, we've got to get everyone on the same page, we've got to create the business models that'll make Web services a reality. It's not there yet."

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