Glenn, a downloadable software store makes sense to me.
>Even as it seeks to find ways to cut back costs, Seattle-based Amazon.com has launched its newest product offering: a downloadable software store, where customers may purchase and download software directly to their desktops.
The store, which plans to sell software titles from Quicken TurboTax to Norton AntiVirus 2001, flaunts one of the company's inherent advantages over its brick-and-mortar counterparts: the convenience of technology.
"The benefit to customers is it lets them get the product right then and there," said Kirk Koenigsbauer, who runs Amazon.com's software division. "When a love-bug virus hits, you can get (anti-virus) software in a matter of moments."
Amazon.com partnered with California-based technology companies Ingram Micro and Preview Systems to operate the store.
Since Amazon.com launched its Internet book business five years ago, the company has rapidly added categories, including consumer electronics, toys and kitchenware. Those early-stage businesses posted $682.2 million in sales last year.
But, under pressure from investors and a slowing economy, the company said it is focusing on profitability and finding ways to reduce its expenses.
With the introduction of downloadable software titles, the company is dipping its toe in a category that should gain traction among consumers.
The company last year launched an e-books store, where consumers may download electronic books, and it offers some downloadable music on its Web site.
But electronic books and other forms of downloadable software will not become widely used until hardware companies produce better gadgets to read electronic books and more consumers adopt high-speed Internet connections that allow them to download larger software programs faster.
Analysts say they want to see the company add new product categories with wider profit margins. Koenigsbauer said the new store will cost less to maintain because the company doesn't have to store, ship or manage inventory.
"There are definitely economic advantages that make the sale of electronic software make sense," he said. |
