Rob, Mark, Glenn et al:
Confused and growing more so. If I get this, it seems that amzn wants to be a book/music seller which also happens to attract consumers of other goods who will make use of its shopping services. Sort of like a gas station hoping to create affiliations with air conditioning manufacturers and travel agents.
Oh well, my feeble mind obviously can't grasp the clear strategy that Bezos must pursuing (why else would you launch a costly music business which you yourself admit has sh-t margins, months before you plan to take the other side of the bet and launch yourself as a shop bot hoping to make money by skimming off the top of music and book sellers like yourself who advertise through your shop bot????)
a few leftover missed in the press this week --
WSJ front page story -- interesting choice for an example of what scared a long term buy and hold investor out of this market.
interactive.wsj.com
About 18 months ago, Mr. Giust began getting edgy about the market's
heady levels. He had ridden through downturns before -- in October
1987, the industrial average plunged 22.6% in a single day. But Mr. Giust
says the mutual funds are more crucial to him now than they were when he
wasn't thinking about early retirement.
The market also seemed to be getting increasingly complicated. In years
past, Mr. Giust says, it seemed there were blue-chip stocks and everything
else. Now the market appears more segmented, he says, with many
stocks that have skyrocketed despite no earnings to show for the rise. It
made him nervous.
"I don't understand the psychology of the market right now," Mr. Giust
says. "Stocks that seem like they should go up aren't, and I'm confused as
hell about the other phenomena" of exploding Internet stocks like
Amazon.com.
August 7, 1998
Investors Cheer Amazon Strategy
Despite Distinct Lack of Details
By LISA BRANSTEN
THE WALL STREET JOURNAL INTERACTIVE EDITION
In Bezos we trust.
Jeff Bezos, that is, the chief executive of Amazon.com Inc. Confidence in
him and the rest of Amazon's management was clearly the message that
investors and industry observers sent after the Seattle on-line bookseller
announced plans Tuesday to spend about $270 million in stock to acquire
Junglee and PlanetAll, a pair of upstart Internet companies.
The deals were announced on a day that saw
the Dow Jones Industrial Average plunge
nearly 300 points, but shares of Amazon
jumped $1.625 to $109.875 on the Nasdaq
Stock Market. Granted, those gains are
peanuts compared with the 260% that
Amazon has soared since the start of the year,
but they represent yet another vote of
confidence for Amazon, which has become the poster child for electronic
commerce.
Amazon had to be cheered by the vote of confidence -- after all, the
company said little about what it plans to do with Junglee and PlanetAll.
Both companies have interesting technologies, but they are pretty far
outside the bookseller's core business.
Junglee is built around a technology that pulls information from hundreds of
Web sites and presents it in an orderly way. At the moment, Junglee's two
main applications involve offering pricing information for comparison
shopping and employment information for job seekers. The company
makes money by taking a slice of transactions completed through its
service.
PlanetAll, meanwhile, offers a service that allows Web users to keep
addresses and calendars in electronic form on the Internet.
What Amazon's announcement lacked in specificity, Mr. Bezos tried to
make up in grandeur. He talked about plans to "enrich the customer
experience of shopping on-line" and implied that the company wants to
become the Internet destination for far more types of electronic commerce
than the books and music it already sells.
PlanetAll's site has 1.5 million users, which is certainly nothing to sneeze at;
one of the few specific uses of the company's technology offered by Mr.
Bezos was reminders about birthdays and other holidays -- ideal nudges,
of course, to get people to buy gifts on Amazon.
Meanwhile, Mr. Bezos dismissed Junglee's best-known service, saying
that "Junglee has nothing to do with comparison shopping -- [that] is not
the primary driver of Junglee's service." Instead, he said, it will be used in
part to make it "much easier for people to find and discover things they can
buy on-line."
"It does mean it is broader than books and music," said Mr. Bezos -- but
how much broader? Mr. Bezos would only mention the company's
previously disclosed plans to sell videos, which left competitors, analysts
and other industry observers speculating.
Keith Benjamin, an analyst at BancAmerica Robertson Stephens, said he
thought travel auctions might be in Amazon's future. Others thought the
combined services might be used to offer very specific gift suggestions --
several types of perfumes for Mom's birthday, for example. Might Amazon
look at selling clothing? After all, that is Junglee's biggest category at the
moment.
It will remain guesswork until Amazon begins making announcements
about new services -- something the company signaled it has no plans to
do in the near term.
Internet companies face endless fretting from Wall Street about their
strings of losses, uncertain futures, and otherworldly valuations: It's almost
impossible to find an analyst who hasn't wondered about the fact that
Amazon's market capitalization briefly topped the combined value of
real-world rivals Barnes & Noble and Borders Group recently.
Yet despite all this -- and despite a distinct paucity of information --
investors showed no desire to punish Amazon for not sticking to its
knitting, choosing instead to believe that Mr. Bezos has a plan, whether it's
selling clothes, travel or zoo animals.
"It is a company that has paid a great deal of attention to detail so far, and
arguably deserves the benefit of the doubt in clearing a new path," said
Lise Buyer, an analyst at Credit Suisse First Boston.
interactive.wsj.com
says.).
Top 10 Web Sites
At Home % Reach At Work % Reach
Aol.com 44.9% Yahoo.com 50.6%
Yahoo.com 41.8 Netscape.com 38.2
Geocities.com 25.5 Aol.com 35.3
Netscape.com 24.5 Microsoft.com 32.2
Microsoft.com 23.8 Excite.com 28.4
Excite.com 22.9 Geocities.com 23.0
Infoseek.com 14.9 Infoseek.com 22.7
Tripod.com 13.7 Lycos.com 19.8
Angelfire.com 12.4 Altavista 17.1
Lycos.com 11.8 Msn.com 13.0
Note: Measurement period is June 1, 1998 through June 30, 1998
Source: Media Metrix, The PC Meter Company
interactive.wsj.com@1.cgi?llamaphlegm/text/wsjie/data/SB902360243544186000.djm/&NVP=&template=news-search.tmpl&form=news-search.html&dbname=wsjie/index&dbname=autowire/index&words=Geocities&any-all=AND&maxitems=30&HI=11
Good thing that there are no other popular web sites that might decide to use their far deeper pockets to make their own alliances for shop bot technologies, and hey, who knows, they might even think that price comparison is an intelligent thing for a bot to do.
LP |
