I wrote last week that Actio, a privately owned business in New Hampshire, became profitable last year selling a Web service that manages chemical safety paperwork. The U.S. government requires that such records -- each one known as a Material Safety Data Sheet, or MSDS -- be maintained by 5 million businesses that make, transport, or use any of thousands of chemicals.

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Before it achieved profitability, however, Actio had to go through the same process as many other e-businesses. In short, answers to the following questions had to be determined:

1. Who are my ideal customers?

2. Why do they need my service?

3. How can I best reach them?

Actio computerizes MSDS forms and puts them on the Web on a customized basis for each client. A hospital emergency room, for example, can then look up full details on a variety of chemicals, using any PC or Web appliance rather than hunting through multiple three-ring binders.

When it started in 1998, however, Actio executives thought their best customers would be distributors of potentially hazardous chemicals. These businesses, after all, range from warehousing entities to trucking companies, all of which are required to maintain detailed records on poisons, antidotes, and the like.

Actio officials quickly learned that their brainchild was brain dead. It turned out that most of the low-tech, low-margin companies in the distribution business didn't have Internet access at their desks -- not even a dial-up AOL account.

The Web service only began taking off when Actio realized that its best customers would be those that handled a lot of chemicals and were very high-tech themselves. Actio's client base now includes the likes of the following:

* Dominion Semiconductor

* Fairchild Semiconductor

* Axcelis

* Mitsubishi (U.S.)

* Hyundai (U.S.)

* Analog Devices (Ireland)

* British Aerospace (U.K.)

These companies now access an extensive and frequently updated database of MSDS information by logging into Actio's site with a password. The Web service totally replaces clients' needs to author and print multiple copies of these documents and distribute them to every building and floor of a far-flung organization.

Wendell Osborne, director of materials management for Alamance Regional Medical Center in Burlington, N.C., estimates that the Actio system saved his hospital at least 50 percent of its MSDS handling costs in its first year alone. By providing a service that businesses actually need, Actio has found a profitable niche in the online world.

ACTIO.NET SITE EXPLAINS "SPECIFIC CONTENT MANAGEMENT":

http://www.actio.net http://bri.li/?4e54

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E-BIZ TECH REVIEW: MAKE MONEY SELLING A GIZMO FOR $40

You'd think there'd be no market for a $40 device that simply turns the volume of your PC or laptop up and down.

But Wired.com says the designer of the PowerMate universal controller knob has already sold 10,000 of them, and the demand isn't slowing.

The device itself is alluring. The silvery, brushed aluminum knob plugs into any USB port. It features a blue plastic ring that glows differently as the volume is increased or your PC goes into idle mode.

But perhaps the killer feature is that a tap on the PowerMate can emulate any keyboard command, such as Ctrl+C for Copy.

Techies are using it to adjust brush sizes in Photoshop and much more. This all looks like a good lesson in sideways thinking when it comes to what consumers want.

POWERMATE "VOLUME CONTROL KNOB" TURNS HEADS:

http://www.wired.com http://bri.li/?7564

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LIVINGSTON'S TOP 10 NEWS PICKS O' THE WEEK

1. Network Commerce sues Microsoft over business patent

http://www.cw360.com http://bri.li/?41c

2. Domino's delivers pizzas with everything via the Web

http://www.internetweek.com http://bri.li/?804

3. How to save on new categories your site should carry

http://www.news.com http://bri.li/?bec

4. Netgrocer looks good in online supermarket shopping

http://ecommerce.internet.com http://bri.li/?fd4

5. You can help save e-music (a well-drafted opinion)

http://www.siliconvalley.com http://bri.li/?13bc

6. Your rights to use copyrighted material (analysis)

http://www.farces.com http://bri.li/?17a4

7. No more tech support! Cuba bans PC sales to public

http://www.wired.com http://bri.li/?1b8c

8. Three key ways to pitch your project to the CIO

http://www.builder.com http://bri.li/?1f74

9. Quickly build a publishing system with PHP and mySQL

http://www.devshed.com http://bri.li/?235c

10. Dunk your digicam and take great pictures (amazing)

http://www.ljworld.com http://bri.li/?2744

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WACKY WEB WEEK: HIGH-TECH PET DOOR ADMITS CATS, NOT MICE

This falls into the CATegory of, "I wouldn't have believed it if I hadn't seen it on my own computer." Quantum Picture, a home-based image processing business, had a problem. Its cat, Flo, kept bringing live mice and birds through the cat door in order to play with its prey inside for hours.

Quantum's solution? They built an image-processing system that can recognize whether the cat has anything in its mouth. The cat door won't open if that's the case.

This is a fascinating experiment in using image-recognition software for benign purposes. I myself have the exact same cat door model in my own home (unmodified, of course). So I can attest that something like this project is, in fact, possible.

You may not need to spot terrorists out of a Super Bowl crowd at 100 paces. But Quantum's Web site -- complete with three small AVI files that show its system at work -- is worth a look just for the ingenuity of it all. Oh, by the way, the name of the project: Flo Control.

IMAGE PROCESSING RUNS PET DOOR AND KEEPS NUISANCES OUT

http://www.quantumpicture.com http://bri.li/?c384

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E-BUSINESS SECRETS: Our mission is to bring you such useful and thought-provoking information about the Web that you actually look forward to reading your e-mail.

ABOUT THE AUTHOR: E-Business Secrets is written by InfoWorld Contributing Editor Brian Livingston (http://SecretsPro.com). Research director is Ben Livingston (no relation). Brian has published 10 books, including:

Windows Me Secrets:

http://www.amazon.com http://bri.li/?0764534939

Windows 2000 Secrets:

http://www.amazon.com http://bri.li/?0764534130

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