There are a couple of authors that I am reading online, and enjoying. I still prefer print, but since both authors publish onlien in a serial format, I get updates faster this way.
Most of you probably know about
Addergoole, as the author is a mutual friend. In case you don't, it's mysterious boarding-school/college story, and the subtle strangeness of the place is revealed slowly, which keeps the reader's interest. The story does get rather sexual at times, so if that is not to your taste, look elsewhere. It updates twice a week (occasionally once a week if the author's life is unisually busy). Friending
addergoole will get you updates as they happen.
I'm really enjoying the recently started Spots the Space Marine story/novel/script: This
link is to the most recent episode, but it has a link at the top to all episodes (scroll down or go to previous entries with the tag to get to the earliest stuff).
haikujaguar is well worth reading - she is an artist and writer, and her work is varied and always interesting. She also wrote the Aphorisms and Admonisments of the Kerdishar, two sets of short stories which can be found on her website
Stardanger.org and on Amazon. She also publishes daily updates on her life and that of her young daughter - her observations of her baby at 21 months are very interesting (she notices things like the first time her daughter displays imagination, makes new sentences, and the various times she puzzles out the world around her). Friending her LiveJournal provides for interesting, near-daily reading and artwork (she has thousands of images up in the gallery on her website). Oh, and she just started a
Zazzle store, which can be found here - I want stuff! Those interested in selling stuff with their artwork or logos on it may want to check out her
initial post on Zazzle as there is a conversation comparing it to CafePress.