How Do Free Websites Make Money?

In order to truly be a free website, the provider cannot charge you fees, collect your information to sell, rent, lease, or share, or put advertising in front of you. Needless to say, there are very few truly free websites; most that are truly free are government, institutional, school, or non-profit websites, though even many of these advertise and sell consumer information.

The way most ’free’ services make money is not by selling advertising. What they sell is access to you, and information about you to advertisers, marketers and researchers, and others. Your information is the commodity that drives the internet economy. It is collected through your online actions and the information you share. If you read a website’s terms and conditions you should be able to see just what information is being collected and how it is shared, though many companies make it very difficult to understand the full scope of their use of your information.

Every piece of information you post and every action you take online has commercial value to company or someone. That isn’t necessarily a bad thing. This trade in information lets you use the websites without paying money for your access. Your information helps companies provide you ads that are more targeted to your interests. It helps researchers and companies know what kind of products to design, and so on.

However, your information is also used in negative and sometimes criminal ways. For example:

  • By companies and organizations who want to use your information in ways that act against your interests

  • Insurance companies who use information posted on blogs to deny coverage of medical claims, car accident claims, and so on.

  • Companies that use information about you to reject your job application or find reasons to fire you.

  • Schools who reject your applications due to information they discover

  • By criminal organizations or individuals building profiles of people to scam, steal identities, hijack computers, find interesting homes to break into or cars to steal,  people to physically harm, and so on

  • By someone who wants to embarrass or bully you

  • Plagiarists who want to claim your content as their own

As you provide information online and visit websites, read the terms and conditions of the sites and consider how that information is being sold, bought, or simply taken. Are you comfortable with the site’s rights to your information? Could the information be used in ways that might harm you in the future? Will the website remove the information if you ask them to? If you aren’t comfortable with the answers to these questions, consider using a different site.

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