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

To: microhoogle! who wrote (118893)	2/28/2001 7:16:22 PM
From: Glenn D. Rudolph	Respond to of 164684

If you go through my previous post starting earlier today, I am arguing that Amazon is not going to fold. It may be lousy as far as bringing in the revenues or the way it burns cash or the way it borrows money but I am more interested in the critical mass of potential customers in terms of registered users it already has built up. The number of users will likely go up once all the small scale etailers die out. If I were an online shopper, I would not prefer to go to 100 different etail sites. I would stick to few (can't remember all of URLs) and Amazon would be the number one. My guess is some company will let AMZN stock bleed as far as possible before it makes a bid for the company. Murali, I understand what you are saying. My prior post was before I read this one but I believe I answered it regardless. Here is what I believe much of which comes from personal experience. My belief also fits quite closely into the buyout that you are suggesting. I believe we are on the same page except for a small detail The attrition of the smaller pure play on-line e-tailers will cause their customer base to go elsewhere. These people prefer to shop on-line. I do not believe the attrition of active customers at Amazon is due to these people not liking their experience of on-line shopping. Rather, people prefer to buy from an on-line site that is connected to a brick and mortar chain. The term used here is dual channel and the advantages for those with dual channel are huge. The time is coming that sales tax will no longer be an issue. It will be charged by the respective states so firms with a nexus in a state will not be disadvantaged price wise from firms that do not have such a nexus. I know it is coming because the PA Department of Revenue just did an audit at one of my stores due to the escalation in non taxable sales. I have an on-line presence and all out of state sales at this point are not taxed. We sell nothing that otherwise would be a non taxable item in the state of Pennsylvania. The audit showed that everything we sold without tax was fine. However, the second part of the audit was to look for the purchase of capital goods and office supplies that the vendor did not charge us sales tax. There were some light bulbs, two computers and believe it or not some ink jet printer cartridges I bought from vendors that do not have a presenece in PA and did not charge me tax. It is incombent (sp) on me as it would be for an individual to obtain a sales and use tax form, write a check and submit the tax to the state of PA. Since I did not do that, I owe $412.00 in tax plus some interes for a three year period. This is true in every state but no one volutarily files these forms. You can count on another mortorium on sales taxes not passing Congress. Believe me I know. What I am driving at is tax wise all firms will be on equal footing so the cost to buy something on-line with the shipping will always be greater than the cost of buying the same product in a traditional store. There are many people that will be willing to pay more for the convenience. It will not be mainstream. These same people that are convenience oriented will shop at stores that are not pure plays so that if there is a reason to return or exchange an item, the inconvenience of shipping it back is not needed. People do not want that inconvenience. Also, the distribution centers already in use for retailers may be used for their on-line distribution this is cost effective. So you will see as more people sho on-line, they will buy from a store that has a traditional outlet somewhere near them for convenience. Every major retailer will offer the convenience of on-line shopping so as not to lose this convenience oriented consumer. The bottom line is Amazon will be bought for the use of their on-line name. It will be bought by some traditional retailer but the distirubtion centers are not needed which will require the filing of a Chapter 11 to exit these leases. I know I sound sure of myself but that is because I am. I also know there are a lot of typographical, spelling and left out words in this post. I do not have time to proof. Glenn