“Selling Air for Fun and Profit”

Dennis Rees

Introduction

Entrepreneurs over the last 30 years have been pushing the boundaries of electronic technology to use every new development to facilitate their dreams of innovative products that can be made once and sold millions or billions of times, at little if any incremental cost. Never in history has an opportunity to create honest wealth and commerce out of “thin air” been available to the people of the world. This essay will consider the new technology, ideas, software and hardware systems, and people who brought this revolutionary opportunity into being between 1980 and today.

This research will explain how, when, why, and by whom, these technological advances were driven. It will also integrate the story of one entrepreneurial company, NexLearn LLC, who has taken advantage of the opportunity to “Sell Air” while making Millions. The history of this company relative to these phenomena will be analyzed to pinpoint the key technological advances, by whom, how, and when they were developed. Further explanations will be sought for how the cadre of new digital entrepreneurs, especially NexLearn, recognized and exploited the value of such inventions as the internet, search engine technology, digital marketing platforms, and various advances in computers and phones to build the businesses that “Sell Air” today.

In selecting the topic of “Selling Air for Fun and Profit” the author is paying homage to the infinite capacity of the free-market system to accommodate almost any and every idea of the entrepreneurial mind. As little as thirty years ago facilities and equipment did not exist to transmit totally digital products into the minds of consumers after receiving digital payment for the transaction. To complete such a transaction today one only need have a cell phone to both purchase and consume such products. No physical transfer of money or hard goods takes place, thus “Selling Air”.

What domain is being talked about? The current list of digital products that are purely make once, sell many is almost limitless but here are a few that you will recognize. e-Books, videos, audio recordings, training courses, photography, SaaS (Software as a service), workout and meal plans, online communities, online documents, pintables, online contract signing services, you get the idea. These are examples of “Selling Air”. Sending the digital ‘essence’ of a product from one device to another device using radio frequency ‘air waves’ that receives, decodes, and plays back the value of the purchase without the participants physical intervention other than pushing a few buttons for the purchase.

What does this mean then from an economic perspective? What costs are stripped out of the supply chain? Almost every logistical cost becomes unnecessary. No manufacturing, no inventory, no delivery cost, no raw materials, no volume related labor of fulfillment, no packaging, almost every logistical cost is done away with or greatly diminished and the link between volume and cost is broken forever. A completely new economic model is enabled, providing leverage on a scale never before available. Profits are possible on margins of 70%, 80%, even 90% dropping to the bottom line. Clearly, “selling air” presented the internet entrepreneurs of the 1980’s, 1990’s, and 2000’s with unprecedented opportunity to profit from this emerging technology. This is the history of one such company; NexLearn.

Background

It all started with the “geeks” or the academics who were laboring to make some practical use of this network that was evolving. In its infancy the internet was like a city of houses with no address book or street map. You knew people were there, but you could not find them. Success in this area was realized over a period of almost three decades, one failure at a time. Each failure led to the next experiment and the next. For the first ten years, from 1982 to about 1992, the effort relied on graduate student projects, theses, and dissertations to drive progress.    

In many cases these students were not only coming up with the logic but also inventing the coding language at the same time. Technical roadblocks were everywhere. Navigating the network and conforming to existing protocols so that these nascent search prospectors could discover the content that must be indexed and made accessible was akin to disassembling the proverbial haystack one straw at a time to find the needle. Once discovered, each straw and needle would be reassembled with an address such that the next person looking for the needle could be taken directly to it, instantly, through all the straw. At first it was fun, an academic challenge, a puzzle to solve as they racked up their advanced degrees. Only later in the second decade did it begin to look like there was profit involved.

The record of the events that took place in the development of search capabilities on the internet is extensive and complete. People were paying attention in numbers large enough to make each advancement the subject of documentation by industry veteran reporters, technology buffs, serious technologists, and chroniclers of the evolution of technology. All interested parties were waiting on pins and needles hoping the next advancement would solve the growing problem of finding specific content on the internet, especially, if you did not know where to look in the first place. Not only did these users want to find it but they wanted to be able to access it in real time.

Timeline

According to many internet historians the internet was spawned in 1969 by the demonstration of the 4 node ARPANET network. Although it is true that there were thousands of disparate networks by the early 1990’s they were not what today we call the internet. They lacked a common language with which to communicate their data. This common language proved to be TCP/IP (Transmission control Protocol / Internet Protocol) only incidentally provided by ARPANET[1]. These early advancements, although foundational to today’s internet came about for the benefit of those using networking at the time. Generally, these users were governments, academics, and scientists. The internet as we know it was still a futuristic concept and many more technologies were to be developed in support of what we have today. Even though data could be transmitted and seen from network to network after TCP/IP, finding a specific piece of data was still very difficult. It required sophisticated programming queries and database searches to find and retrieve anything. The need for search engine technology to make search available to the non-technical user was a critical step in the evolution of the practicality of the internet. [2]

Once these primary technologies of the internet were in evidence, we see young entrepreneurs begin to have a vision of a new economic opportunity. Companies like NexLearn were born in an atmosphere of enthusiasm and exuberance. NexLearn’s predecessor, Knowledge Communication was born on the campus of Wichita State University in 1994 by a few recent and near graduates. They had been recipients of some of the richest scholarships for entrepreneurship that existed in the country at that point. They had attended the University’s school of Entrepreneurship and had learned to take full advantage of the environment for business and commerce. [3] They were willing to risk their future to start a company based on the new and developing technology on the internet and computing in general. Their future was predicated on society adopting a new and different paradigm in corporate training comprised of a library of digital training titles available for exposition on a computer screen at a time and place chosen by the student. This being the first product brought forth successfully by these young entrepreneurs. By selling these libraries of corporate training titles directly to the companies to be housed and delivered by their internal networks, the problem of finding the titles on the internet was initially avoided. This model necessarily limited the distribution of the digital works to those who were sold a key to the library. In the mid to late 1990’s while Google and others were grappling with the search engine mechanics, young entrepreneurs like those at NexLearn were trying to find the answer to ubiquitous access to their title libraries for anyone who wanted it. The goals of both were one in the same.

Google was founded in 1998 and through its advanced search technology rose to prominence in the market, surpassing Yahoo search as the number one search engine by 2002.[4] By 2002 search engines were becoming a staple process by which consumers found products that fit their requests. A standard operating process was beginning to emerge. Consumer goes to the internet, opens a preferred search page, executes a search, is shown a search engine results page (SERP), picks the desired result from the page, and repeats the process until an acceptable result is obtained. As can be seen, the key for entrepreneurs eager to sell their products is to get their product to be shown in an advantaged position in the search engine results page. This page positioning or ranking (SERP) is the determinant factor in how many searchers ever see your page on the search engine. The higher your page ranking, the greater the chance that a searcher will see and select your site as the ideal result to their search. This is the critical determining factor in revenue generation for digital products. If you cannot be one of the first 5 entries on the first page in the search rankings your chances of selection are miniscule.   “You need to be near the top: The first five results receive 67.6% of clicks, whereas the remaining five just receive 3.73%.”[5] The reason the above math does not equal 100% is because of the further complications of ads being placed on the SERP as well. Some of the clicks go to the paid advertisements on the page. There are at least two ways to appear high in the SERP; pay for ads or make your page so compatible with the Google search algorithm that your listing is shown at the top of the page natively. Seems relatively straight forward at first glance and would be so if it were not for the fact that no one knows for certain what the workings of the Google Algorithm really are. Starting in 2016 NexLearn began to focus more and more on ways to appear higher in the SERP to gain visibility to potential customers.

NexLearn

By this time NexLearn was beginning to develop new products and services for the custom development market. This market required NexLearn to work with individual companies to develop training specific to that company’s specifications. This strategy was short term in nature and was undertaken to ‘pay the bills’ while other more strategic products were conceived of and developed for the NexLearn account. Without such products to appeal to searchers, NexLearn would not be able to compete with others in the SERP. As with a lot of enterprises, NexLearn continued in the short-term mindset for a few years. It was easy to continue to produce custom projects for the market as NexLearn was gaining a reputation for quality and service that made it easy to secure the next project and so on. The entrepreneurs at NexLearn however, knew that sell one – make one was not a long-term model that would create wealth or access the extreme economic leverage they knew existed on the internet.  

In 2011 NexLearn was looking for products it could sell on the internet in a make one – sell many model that would open the power of the internet and the search engines. It found such a company and purchased from it two principal assets. The first asset was a Learning Management System that allowed for the administration and delivery of training to almost anyone on the internet while maintaining control of the source and intellectual property of the training. The second was a course that had little or no value at the time but possible future benefit. The company that NexLearn acquired these assets from had spent several million producing and marketing them but had received little traction for their efforts. They had not focused much effort on the search engine optimization (SEO) effort required to be seen on the first page of the SERP. From 2012 to 2016 NexLearn focused on improving these products with enhancements and updated user experiences for newer and contemporary platforms like mobile, tablet and phone playback.

In 2016 and beyond, NexLearn concentrated on creating a market fed by search engine results. This effort required a concentration on all the possible attributes considered by the Google and other search algorithms. Generally, search engines must demonstrate that they can index the greatest number of web pages, suggest highly relevant pages to the searcher in the SERP, all in a highly useable platform that produces relevant results in a low response time model. If a search engine can produce the above result, it has a good chance of being adopted by the searchers and its advertising services may be of value to the producers as well. This activity of connecting two sides of a market in the least time with the most relevant result in a useable platform is the goal of every search provider. Google Search is currently the provider of choice for most searchers.[6]

NexLearn from 2016 to present has concentrated a lot of effort in the specific tactics required to increase native and other web traffic. Starting in 2016 with less than 200 web visitors per day, NexLearn has grown traffic to nearly 6000 unique visits per day. This accomplishment has driven potential customers to a record of over 2 million per year.[7] This level of traffic has come through a lot of hard work plying every avenue of traffic available from the search engines. To be successful at this game requires companies to provide relevant content to the search market that coincides with what searchers are looking for. This is much more difficult that it might seem. Others are doing the same thing at the same time fostering extreme competition for each click. As search engines have developed over time to provide the world with access to the most relevant web pages for each search, they have developed complicated algorithms that determine the priority of entries into the SERP’s. Each company that wishes their pages to be presented in an advantaged position in the SERP’s had to make it their business to try to understand the workings of this unpublished, complex algorithm consisting of at least 24 website characteristics. The effort mounted by companies to force their content to the top of the SERP is generally known as Search Engine Optimization (SEO). SEO efforts are mounted on a particular web page to make it most appealing in the 24 or so characteristics that affect the pages ranking in the search engines. Factors such as quality and quantity of backlinks, social media support, keyword in title tag, website structure, website size, loading time, domain age, keyword in URL, existence of SSL Certificate, text length and other factors are all important to the SERP and where your site falls in its ranking relative to your competitors. No one knows exactly how each of these characteristics are weighted in the algorithm to come to the final page rank.[8]

The Hard Work

Beginning in 2016 NexLearn embarked on a series of efforts to attend to each one of the page ranking criteria in order. They contracted with outside consultants who were believed to be expert in the algorithm and opened accounts with many 3^rd party software providers that would provide analysis of each page with respect to its optimal configuration. They eventually hired an ‘SEO’ expert full time. Once in place, following their expert’s advice, NexLearn undertook to repair every part of the site that could harbor any code that would detract form page ranking within the search algorithms.[9] NexLearn focused its remediation efforts on the factors that appeared to researchers to have the most effect on page ranking.[10] These factors were SSL certificate, Keywords in URL, quantity of backlinks pointing to the website, and length of text, all of which became a focus of the NexLearn SEO team. By 2019 these efforts at SEO had begun to yield results in terms of increased traffic to the site and therefore increased conversions and sales. One must always keep in mind the dynamic nature of the search algorithms and their lag with respect to adjusting results of the pages indexed to changes made by the publishers. Not only do publishers of web sites make dozens or even hundreds of changes to their pages in each period, but the algorithm is constantly being updated to place emphasis on a given characteristic. All this information is fed into the model and the result is the SERP at a given moment in time for a specific search request. Today the model is kept current through a series of ‘bots’ or ‘spiders’, programs spawned by the search engine companies to examine all corners of the web to find pages to index.[11] Comparisons are made to find any new and updated content so that the index can be kept fresh and accurate. This continual renewal of the index is what makes search engines valuable to entrepreneurs of web-based commerce. It provides a continual opportunity to make changes to your web presence to make it more attractive to the search engines and thus to rank higher in the SERP and subsequently to be chosen by a searcher.

While paying attention to the SERP for all pages on the NexLearn website, it was also very active in expanding its product lineup. One of the consistently touted factors in the SERP is content that is consistent with searches. In other words, content that matches the requests of the searchers so that it can be presented by the search engines and satisfy the search engines customers, the searchers. This is the primary measure of success of the search engine providers. If a searcher is satisfied, he or she will pick one of the offered results and then take some intended action regarding that search. The search engines track these selections and once again, the feedback loop kicks in and a site that is successful in gaining searchers to pick their content is given even more respect in the subsequent SERP through the algorithm. The more content a web site has that is relevant to a search, the more often and higher in the list of the SERP it will appear. NexLearn went from only one product being sold on the web in 2016 to over 35 products today. Each of these products is a digitally delivered course that addresses in some way a specific search need of a searcher. The products are generally all in the category of online education tied to a specific geographical regulatory specification. In other words, NexLearn creates courses that fulfill specific regulatory requirements and are approved by regulatory agencies. This acts as a barrier to entry for companies that seek to create new products for the regulated market. The approval process is typically long, expensive, and arduous for those companies wishing to participate with their own entrants.[12]  Combining SEO efforts with constantly adding new content and products creates an atmosphere of continuing reindexing on the search engines and higher SERP positioning. This does not happen overnight as the SERP algorithm has a dampened reaction to all the factors in the algorithm. It is generally believed that it takes from 3 to 6 months for changes indexed by the search engines to have any significant effect on the SERP. Again, NexLearn has been building traffic through a concentrated and sustained effort to affect the SERP in their favor and have been successful in not only moving up in the page rankings but also being shown in that higher position more often to searchers,

So far, we have limited our discussion to SEO. Search engine optimization addresses the ‘free’ or ‘native’ traffic available to marketers from the searches executed by the searchers. There is also another side of the SERP equation that allows marketers to gather clicks from the search engines. These clicks are available through paid advertisement. Pay-per-click (PPC) is another way to increase traffic to your site. It is generally expensive to access this market but is engaged in at some level by most internet marketers. NexLearn as a company started its PPC efforts on a very small scale in about 2018. They slowly and gradually moved their budget from a few dollars per day to hundreds of dollars per day to the present where they are spending over $1000 per day on paid advertisements. The PPC market is the place that Search Engine operators make their money. They have a special place in the SERP where they display the ads of PPC participants. Paid placement is based on an auction type marketplace wherein participants tell the search engine operator how much they are willing to pay at a specific point in time to have their ad offered to a searcher. You only pay when a searcher clicks on your ad to be transported to your web page. This does not mean that you will necessarily sell your product to that person but only that that person is exposed to your web site. If your site is compelling enough in terms of content, you may be able to move that visitor through your sales funnel to complete the purchase. Most web sites have a low completion percentage. That is to say that of all visitors to the site, how many purchase your product. We see that sites convert from 1% to about 8% and about 3.75% on average of all e-commerce related sites using PPC.[13] The combination of PPC and SEO comprises the most effective strategy for gaining traffic from searchers.

As NexLearn made the transition from a custom e-learning developer to an internet marketing company their skills also had to follow the new business opportunity. They needed less and less traditional sales and marketing effort and more and more expertise in internet style marketing skill. The difference is not subtle. Traditional people skills where salesmen met potential clients face to face at conferences and trade shows were replaced by an anonymous presentation of web content and advertisements. E-mail and retargeting potential customers who had reached a certain point in the web marketing funnel became the tasks taken against warm prospects. No longer did salesmen at NexLearn target individuals in certain positions at large companies who might have a project and budget to complete the work. No longer did NexLearn depend on an average sale in the dozens of thousands of dollars. Instead, NexLearn depended on thousands of transactions from unknown searchers on the web worth a few dollars each. This transformation was from a sell one – build one economy totally dependent on the next sales transaction to the build one – sell many economies that is agnostic about the identity of the buyer. No longer was NexLearn’s revenue wholly dependent on it’s ongoing and expensive sales force of executive salesmen. Recurring revenue that was hardy and invested with thousands of potential customers every day was coming from the Web. The cycle of feast or famine in terms of sales and opportunity was replaced with this hardy and predictable stream of potential customers who wanted to consume products from NexLearn that had very little if any incremental cost. A sustainable business that had all the economic earmarks to allow great wealth creation and growth with no end in sight.

Conclusion

Let’s review now, how did NexLearn take advantage of the advancements in technology that would facilitate this new and highly leverageable business model? In examining these historical developments, a sort of timeline that helped NexLearn along the way would be instructive. These events all contributed in some way to the ultimate success of NexLearn in this new field.

From the Broadband Landing Web Site, we discover the following events:

History Of the Internet Timeline:[14]

• 1969 – The first message is sent over ARPANET on October 9th.
• 1971 – E-mail is introduced, and quickly suggested to be a waste of network resources.
• 1973 – Norway and England become the first international networks connected.
• 1982 – TCP/IP is made the protocol for ARPANET
• 1983 – The first name server is put into use, and users no longer need to know exact network paths.
• 1985 – Domain name servers, now totaling 1000 or more domains, eliminate the need to use IP addresses, allowing for domain names to be used as a nickname for a network.
• 1989 – With over 100,000 hosts, the Internet Backbone is upgraded to T1, able to handle up to 1.5 Mbps.
• 1990 – The first search engine, Archie, is released enabling people using the FTP protocol to index files. In essence Archie is also the first file sharing service.
• 1992 – Tim Berners-Lee Invents Hypertext, as well as the world’s first Web Browser.
• 1993 – The highly graphical Mosaic Web Browser debuts. Mosaic plays a critical role in making the World Wide Web Accessible, and interesting, and is largely credited with making the Internet interesting to consumers.
• 1993 – InterNIC is established to manage registration of domain names, and the White House gets its own Web Site drawing massive media attention.
• 1994 – The first search engine for the World Wide Web, Yahoo, is established.
  • NexLearn is established as Knowledge Communication and begins to produce ‘computer-based training’
• 1995 – Numerous commercial high speed internet providers are established making the Internet widely, and easily, accessible to non-government, and non-corporate users.
• 1995 – Netscape introduces JavaScript, initially called LiveScript. JavaScript, not to be confused with the JAVA programming language, is an object-oriented language that is interpreted by a web browser as the page loads (rather than by a web server, or by being compiled prior to the loading of the page).
• 1996 – Microsoft, in their Internet Explorer browser, provides a new element, the iFrame, making it accessible via JavaScript. This creates AJAX, while only recently widely adopted AJAX powers most Web 2.0 applications.
• 1996 – eBay is started, initially as a place for consumers to market items to each other. One of the first sales was that of a broken laser pointer.
• 1996 – With so much consumer traffic, educational institutions internet2 is established solely to provide higher speed transmissions between educational institutions.
• 1998 – Google is founded hoping to improve the quality of search results.
• 1998 – PayPal is formed for consumer-to-consumer payments. A natural fit for eBay it quickly becomes the payment method of choice for eBay customers.
• 1998 – Apple introduces the iMac as the world’s first Internet centric computer.
• 1999 – Napster popularizes internet file sharing, especially of music, and popularizes the mp3 file format (which originally was the audio format of MPEG 2 video content). Several File Sharing Services, like Aimster, emerged trying to legally perform the same function.
• 2001 – Drawing on the popularity of the mp3 file format Apple introduces the iPod, designed initially only as an mp3 player, but also integrated with Apple’s internet music store iTunes.
  • Knowledge Communication sold to Harcourt Brace, the Book Publisher. NexLearn is established by the workers who do not become Harcourt employees.
• 2006 – The concept of cloud computing becomes increasingly popular, and numerous services try to implement cloud computing networks, and infrastructure.
• 2007 – Apple introduces the iPhone, which words with its cloud-like service MobileMe. The iPhone, to a far more sincere extent than iMac and iPod, becomes the most Internet centric mobile phone, quickly saturating data usage on AT&T’s network.
• 2008 – With IP Addresses rapidly becoming scarce IP6 is developed to increase the number of available IP addresses.
• 2011 – Microsoft Acquires Skype
  • NexLearn determines to become an internet marketer and retool revenues to a recurring revenue model from its custom development roots.[15]

Since these events, 2011 forward, we have seen a plethora of hardware and software advances mostly in the operating system arena. Computers have continued to get more powerful and smaller. The form factor of the mobile phone is currently the platform most internet marketers are developing towards. With over 3 billion mobile phone users in the world and more being added every minute, internet marketers see a bright future. NexLearn recognizes that close to ½ of its internet traffic originates on mobile devices and has optimized its products for mobile playback. Of course, many of the above events had a major impact on where NexLearn ended up. Without the invention of the internet with ARPANET, the language to communicate with TCP-IP, the inventions to catalogue domains, software for browsers, payment gateways, and especially search engines, the e-commerce monster we know as the internet would not be what it is today. NexLearn would likely still be a sell one – build one custom development house waxing and waning with the traditional economy on any given month. Instead, having taken advantage of the above internet inventions, NexLearn is a thriving member of the make-one, sell-many communities of e-commerce purveyors on the internet with a hardy multi-million-dollar revenue stream growing at 40% per year.

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[2] Divya Sharma, Agam Gupta, Arqum Mateen, and Sankalp Pratap. “Making Sense of the Changing Face of Google’s Search Engine Results Page: An advertiser’s Perspective.” Journal of Information, Communication & Ethics in Society 16, no. 1 (2018): 90-107.

[3] Dean Fouquet. 2021. Review of NexLearn LLC, Interview by Dennis Rees. https://watch.liberty.edu/media/t/1_s4v5b8gm

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[15] Dean Fouquet. 2021. Review of NexLearn LLC, Interview.