User heaven, capitalist hell: What could be more embarrassing than a website that lacks the requisite number of banner ads? It implies a certain, shall we say, lack of confidence from the business community in whatever product or service is being shilled therein. Fortunately, InPhonic Inc. wants to help disguise that unsightly ad-free expanse. The Washington, D.C.-based startup will provide companies with the opportunity to use unsold ad inventory as a launching pad to sell private-label cell phones. "Ad space on the Internet is like an airplane," says David Steinberg, InPhonic.com president and CEO. "When a plane takes off and a seat is not sold, it can never be sold again."
Here's the deal: InPhonic.com spots unsold banner spaces and replaces them with ads for its own cell phones. The kicker is that the phones are branded with the name of whatever site they're sold from. So, a phone bought from www.darwinmag.com would come branded with the Darwin logo. (This is theoretical, naturally, since we'd never have unsold ad space.) Once a viewer clicks on the ad, a page pops up that walks him through the purchase process. InPhonic.com handles all the sales and back end of each transaction-and makes the money from the sale as well. But the company functions as an anonymous source: Its name does not appear on the ad or the phone. In other words, InPhonic.com gets the money, and the site saves face.