Trying to help a friend and not having much luck...

One of my male friends is really shy. So shy that he can at times come across as obnoxious. He's been trying for a really long time to find a girlfriend. The only way he feels he can find love is through internet dating sites, the problem being that he has profiles all over the place and nobody has responded to messages he's sent out via them.

I'm pretty much out of ideas on how to help him and its getting to the point now where inviting him to social gatherings seems more like a chore than actually wanting his company. I don't have any other single friends, everybody I know is either married or in a long term relationship. Whenever we all meet up he just talks about how depressing his life is, how he'll die alone (even though none of us are 30 yet), how he's always going to be a virgin etc etc etc. It's at the stage now where he's getting depressing to be around, and always seems to suck the fun out of a situation/ gathering.

So my question is what the hell can i do?!?! He's not willing to talk to strangers face to face, in fact if there is someone in the room whom he doesn't know he won't speak at all, then get drunk and the rest isn't very pretty. I really am at the end of my tether!

Should I be cruel to be kind and tell him how I feel? Will that damage his confidence more? Is there some way of getting him a date that I don't know about? Help please!