Follow the instructions below and it will work.

Disconnect the Camera from the USB port and reinstall the CD or Downloaded software program.

When the program asks you to connect the camera to the USB port, do so and it should work.

Then to use it on the Web, do this.
Web Camera’s have to be setup on the program they are to be used with. Just installing the
camera on your computer does not set it up to broadcast on messengers or Skype.

Each program has Options that have to be setup in order for the Audio and Video to function properly.

A. Skype Setup:
After downloading and installing Skype

http://www.skype.com/intl/en-gb/download/skype/windows/beta/downloading/

set it up as follows:
Go to Tools, then Options, and click on Audio Settings and set the Microphone and Speakers to the computer Audio Card.
Then click on the Video Settings.
The camera, if Installed Properly, it will come up and show a video picture.
Then, on the bottom of the page click save.
The camera and audio should function properly. Your friends and Family will now be able to see and hear you.

B. Yahoo Setup:
After downloading and installing Yahoo Messenger

http://www.soft32.com/download_30.HTML

set it up as follows:
Go to Messenger at the top left and click on it.
Next go down to Preferences and click on it.
Next Calling and Devices on the right and set the Microphone and Speakers to the computer Audio Card.
Next go to the Test Audio section and (in blue writing) click on "Open the call setup assistant" and follow the instructions on the left window.

C. Windows Live Messenger:

http://download.live.com/Messenger

After you start Windows Live Messenger, expand the view by clicking on the square on top left next to the red X.
Then on the Windows Live messenger window on the right side, click on " "Show Menus." And then click on "Show the Menu Bar".
Next go to the Menu Bar on right side, click on " "Action."
Go to "TOOLS" and click "Audio and Video Setting" and follow the instructions.
NOTE: Your audio and video should work. Enjoy.
When done both the Audio and Video will function properly so you can chat and see family or friends you are connected to.

D. AIM (AOL) Messenger:

http://dashboard.aim.com/aim

On the VIM sign-in window click on Edit.
Then click on Settings Enhanced IM.
Next click on Enhanced IM.
Then click on Audio Video.
The Audio and Video portion has drop downs so you can select the proper audio card and video camera installed in you computer.
The Audi Video drop downs are
Microphone
Speaker
Camera
The audio and camera should function now.
Additional information to use with VIM settings.
Adjust Your Audio and Video Settings:
In order to adjust your audio and video settings, please follow the steps given below:
1. Click the Audio and Video Settings button directly below the My Buddy or My Camera window. If you are currently
Participating in an AOL Live Video IM session, a message will display: You must disconnect the current AOL Live Video IM
Conversation before running setup. Would you like to disconnect now? Click the Yes button.
2. The Audio and Video Tuning Wizard will appear to help you verify that your camera, speakers and microphone are working
Properly. Follow the on-screen prompts.
Notes:
The first time you use AOL Live Video IM, a message will display: Would you like to first check your audio and video settings? Click the Yes button.
The Audio and Video Tuning Wizard will appear to help you verify that your camera, speakers and microphone are working properly.
Follow the on-screen prompts.
images in AOL Live Video IM may appear reversed, or as a mirror image (text may appear backwards) when you look at your own camera feed or at the
Picture-in-picture (PIP) display.
After making the settings your ready for a chat and video talk with your Family and Friends.
Hope this helps. Bud