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Strategies & Market Trends : The New Economy and its Winners -- Ignore unavailable to you. Want to Upgrade?

To: techanalyst1 who wrote (12880)	7/20/2002 5:51:22 AM
From: stockman_scott	Read Replies (1) \| Respond to of 57684

Major downshift phase seen for dollar japantimes.co.jp

To: techanalyst1 who wrote (12880)	7/20/2002 1:03:50 PM
From: Bill Harmond	Read Replies (2) \| Respond to of 57684

I don't think you're being silly. Disney is stuck with an 50-year-old model with the same tired distribution. Disneys great stock price appreciation came from a combination of two things: the globalization of Mickey Mouse which was a textbook case of asset maximization, and the huge pe expansion since 1981 due to disinflation. Now Disney is caught in a business of diminishing returns. They don't have a follow-up act. Buying Capital Cities/ABC was a mistake. They have already arm-twisted cable companies with hugh fees increases for ESPN. They have failed find any synergies with ABC, and have a programming disaster on their hands. Disney can't program a winning television network. They long ago built gift shops at the exit of every ride at their parks, and their new parks are are providing diminishing returns. What Yahoo and eBay have are unencumbered models and open-ended scalability. That's why they remain so expensive. eBay and Yahoo have reached critical mass. All the tired arguments about Yahoo and eBay being threatened by low barriers to entry have faded away now. Ebay's only real risks are technology execution. Network effects are in full force for Ebay, much like they became in a physical way for Manhattan in the 1800's. Commerce is increasingly attracted there because that's where the commerce is. Yahoo (and Amazon for that matter) have different dynamics, but both have open-ended growth potential because they have survived unimpeded and have proven to be centers of gravity for B2C. There will be few commercial operators on the Web that won't plug into Yahoo's directory services and advertising (read "linking") platform. On a different level, Amazon will grow as the front end for etailing by providing a central interface to other retailers.