jan:
can you read? let's assume this "puppy does go into many domains"
''I get the combination of books and
music and videos,'' says Robert Kagle, a venture capitalist who invests
in Internet startups for Benchmark Capital. ''Beyond that, I don't know
how far their brand goes.''
Even if the brand does travel well, it's almost guaranteed that other
products won't be as profitable. Take CDs: They have lower margins
than books. Same for videos. Toys have the disadvantage of not having
as established a distribution network as books and music. So Amazon
may have to stock more on its own, increasing its inventory costs and
skimming off some of that nice float.
Already, established competitors are forcing it to do just that. Reel.com
says 96% of the 20,000 titles it stocks are on the backlist. Those
videos constitute most of its sales--and by far the most profitable
portion. ''If Amazon wants to ship them in a reasonable time, they'll have
to stock them,'' says Reel.com CEO Julie Wainwright. And some
products, such as cars, real estate, or office products, are simply too
cumbersome or expensive to ship. Or they may require too much
aftersale support--which makes software a dicey product for Amazon to
sell. |
