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To: Bill Harmond who wrote (82771)	11/2/1999 12:05:00 PM
From: KeepItSimple	Respond to of 164684

>The small guys don't have the market cap, Yes, thats right. No IPO recently has a big market cap. They are all only valued at 1 or 2 million dollars.

To: Bill Harmond who wrote (82771)	11/2/1999 3:12:00 PM
From: Greater Fool	Read Replies (1) \| Respond to of 164684

So being able to spend $20M on advertising justifies -- even just partially -- a valuation 1,000x that high? Spending on advertising does create a barrier to entry, but the spending has to be proportional to the attractiveness of what's inside the barriers. Currently it's not profits but valuation. Why wouldn't investors be willing to fund large spending on advertising if that will buy barriers and hence high valuation? Seems to me that's exactly what's happened here. Advertising creates barriers but they have to be sustained (in an expensive fashion) and they are easily reproducible. It does permanently create a war in which all sides are committed to a never ending stream of expenses. I expect this Christmas to be bombarded with ads from etailers of every size and shape imaginable.