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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: H James Morris who wrote (104449)	6/1/2000 10:35:00 AM
From: re3	Read Replies (1) \| Respond to of 164684

got vaso ? holy -hit, up again today !

To: H James Morris who wrote (104449)	6/1/2000 1:41:00 PM
From: Glenn D. Rudolph	Read Replies (2) \| Respond to of 164684

May 31, 2000 Personalized E-Mail ------------------------------------------------------------------------ Bertelsmann BOL-Barnesandnoble Merger Would Rival Amazon By STEPHAN KUEFFNER FRANKFURT -- So far, the only visible tie between the operations of Barnesandnoble.com and BOL International GmbH is a clickable link on the bn.com website, though Bertelsmann AG (G.BRT) owns 40% of the former and all of the latter. That would make a merger - talked about this week in the Frankfurt stock market - appear highly unlikely. But the rumor has caught on, with participants saying a merger of the two online booksellers under one brand makes good business sense and would create a credible global rival for market leader Amazon.com Inc. (AMZN). Bertelsmann delayed its initial public offering of a 20%-25% BOL stake earlier this month, in the wake of extremely weak and volatile stock market conditions. Then, German media began speculating the decision was as much about a strategic merger with bnl.com as it was about the IPO climate. Bertelsmann says it won't comment on the bn.com merger talk, and if it's true, silence may be the best policy. Apart from creating an online bookselling giant, a properly timed merger would provide a much-needed success for Bertelsmann Chairman Thomas Middelhoff, whose Internet strategy has suffered major setbacks this year. Like other old economy publishing groups, Bertelsmann was slow to discover electronic commerce, allowing upstarts like Amazon to become the biggest player in the market and other rivals to gain a solid foothold. But moving soon, while stock markets are weak, may allow Bertelsmann to immediately grab market share and establish itself as a strong online presence. To do so stealthily and without leaks to the media would maximize the impact on the shares of Amazon.com and other rivals. "High valuations kept new economy companies safe from takeovers. With that protective wall crumbling, old economy companies can come back with a vengeance," an Internet analyst in Duesseldorf said. Nothing would make Middelhoff happier. Bertelsmann has been criticized for keeping an unfocused Internet portfolio. It has also seen its close links with America Online Inc. (AOL) fall apart in the wake of the AOL-Time Warner Inc. (TWX) merger. "Even though it's still somewhat hesitant, Bertelsmann is beginning to structure its Internet business," said Harald Heider, head of media analysis at DG Bank. "It can select good, tried and tested technology once the current consolidation phase separates the good from the bad." Joining the two online book retailers would give them the mass presence needed to joust with Amazon, "if there isn't too much overlap," Heider said. "Basically, it's hard to differentiate products when selling things like books and CDs. Therefore, going for the largest reach is the most sensible strategy." BOL, by itself, has already figured that out, launching sites in several European and Asian countries. It plans to establish virtual shops in China and Italy later this year and Spanish and Portuguese language coverage to Latin America. It recently completed a takeover of a Scandinavian company to enter a key European market. But BOL is tight lipped, so it's hard to tell how well the online bookseller is doing. All it says publicly is that its customer base is growing by 80,000 to 90,000 a month. Rival Amazon has sites in the U.S., U.K., and Germany. In late April, Amazon.de reported first-quarter sales of DEM55.9 million (EUR1=DEM1.95583) from DEM51.4 million in the last quarter of 1999 and DEM17.8 million a year earlier. Its one millionth customer used the service in mid-February. A company spokeswoman said Amazon wouldn't report the losses recorded by Amazon.de or its European expansion strategy. A BOL spokesman said its original plan to list could be put back on at the flick of a switch. A merger is more likely, though, as market consolidation continues. "Only around three big players will remain," Heider said. If Bertelsmann wants to be one of them - and a real rival to the market leader - it's going to have to combine well-timed strategic moves with its bricks-and-mortar might. -By Stephan Kueffner; +49 69 29 72 55 00; stephan.kueffnerdowjones.com