Just my opinion, but I think the launch of this site is going to generate a huge amount of news. The scenario I picture is: the first wholesaler enters the online music segment to compete with the retailers, who have been making a killing on the market. All of a sudden pricing readily available to all consumers is slashed 30-40 percent ($16-17 to $12). Where are the margins? Are retailers like K-Tel, CDNow, N2K, Amazon, etc., really strong enough brands -- or adding enough value -- to maintain firm control over pricing and margins? Doubtful. Are all these retailers viable in a universe of wholesale pricing? Personally, if I were long on KTEL, CDNW, etc., I'd be pretty nervous right now.
I bet in Sept-Oct we'll see WSJ picking up the story. They won't tell this as the story of a piddling little BB stock like TSIG, of course. Their storyline will be the squeeze faced by the existing high flyers. Will the online CD retail market survive, etc., etc.? But TSIG will emerge from the background as the company that is driving the pricing game, and that'll doubtless generate widespread interest in the company. That's ultimately how we'll see the real-world investors enter the TSIG market.
It's too good a story to miss, and it goes right to the heart of a major market phenomenon: the high-flying Internet retailers. The challenge for TSIG will be asserting their brand in the retail space, which traditionally is difficult for wholesalers. |
