The simplest form of Net competition is a quiz. Music, general knowledge and films are popular, where people can obtain the questions by e-mail.
It is possible to set up virtually any kind of competition if you use your imagination.
Prizes can be obtained by asking companies (not only those on the Net) to donate a prize in return for advertising space, with profits being earned by selling additional ad space, plus mailing lists of customers and advertisers.
Dedicated games services are also popular. Software companies now have facilities to play their games over the Net, but can be slow.
Far better to set up a dedicated game server (with hard/software that allows people to play against one another, such at BT's WirePlay), charging by the hour.
Rent space from your local Net service provider, offering a dedicated game service with favourites like Doom or Quake. Your charges will therefore be added to customers' monthly online bills from their providers.
If you don't have the necessary technical expertise to set up a game or competition site contact your service provider. They may help you in return for a percentage of your charges.
A very useful marketing tool can be applied to this web success idea. Give a small proportion of your profits to a relevant charity. Many people feel much happier about loosing money if some of it goes to a good cause.