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

To: winam who wrote (1492)	2/10/1998 7:48:00 AM
From: John May	Read Replies (1) \| Respond to of 164684

winam, With all due respect, the further down the road one takes a scenario, the greater the degree of error. You assume up front, however, that the book market will shrink which contradicts articles I've read. In fact, thus far E-commerce has stimulated the sale of more books. You assume, in the out years of your scenario, that BKS and BGP will catch and overtake AMZN in E-book sales. This, too, runs counter to what I've read (in fact I posted here recently a Jumpiter Communications article on the subject) that early comers to E-commerce will have the advantage of having secured the high ground of visibility. I think a $15 to $20 billion Internet book pie in 2008 might well mean a $4 to $5 billion slice for AMZN, but my second thought is that the degree of error in predicting 2008 E-commerce is too great to debate.

To: winam who wrote (1492)	2/11/1998 11:08:00 PM
From: Tom D	Respond to of 164684

Thank you for your post #1492 critiquing my lengthy pro-AMZN post #1441. Here are my thoughts about your arguments. 1) The book market is declining: Veronis, Suhler & Associates, Wilkofsky Gruen Associates, Book Industry group estimate the total domestic book market in 1997, 1999 and 2001 at $27B, $30B and $33B, and global sales at $85B, $90B and $95B in the same years. I foresee the internet cannibalizing newspaper and magazine sales a lot more than book sales. 2) On the internet books will be commodities. You may be right, but I think it is controversial about how much brand loyalty AMZN can create. I am a physician. I feel my time is so limited that I am not sure I even want to mess around with the Best Book Buys web page, ordering each book from different sellers. I do appreciate the extra information and reviews available at AMZN, and the suggestions for related books. Their service has a good profile of my book-buying interests, and I often end up buying additional related books which they suggest. As you know, at AMZN readers can post their comments about books which they have read. This is really nice. For the sake of argument, even if we devalue our time down to $20 per hour, any book we buy will consume several hours of our time for reading. In this context, who cares about an extra couple dollars here or there? Who has the time to go to bookstores anymore? Everybody and their spouse is too busy at their jobs in our new globally-dominating Republican-controlled lots-of-layoffs-leading-to-miserly-wages economy. (The only time I really get into cost containment is when I use Microsoft Expedia to research the cheapest airplane reservations and then turn around and buy the ticket directly from the airline, but that is because I despise MSFT's business ethics and enjoy depriving them of revenue. 3) B&N will not concede the on-line market to amzn. In their first-quarter conference call last year B&N stated that the company would not let its on-line business negatively affect its operating results. Like it or not, the investment community has accepted AMZN's plans to lose $20 to 30M annually in '97 and '98. B&N and Borders would have to make a major change in their business plan to compete with AMZN's marketing. 4-6) I don't agree with John May (#1493) that the degree of error in predicting 2008 is too great to debate. Imho, this is a key issue because the basis for the current lofty valuation certainly is not current earnings. We are all betting on our vision of the future. We may have to wait another quarter or two and compare on-line bookseller revenue growth to confirm that Mr. John Doerr is right (see my post #1516) in order to resolve our differences about future expectations. I am buying into the vision that AMZN will get so large that it will become a true on-line community of discussion about books, and gain economies of scale, and become THE dominant on-line bookseller which undermines the profitability of the highly-leveraged, fiscally-shaky land-based booksellers. I am happy that you took my posting #1441 seriously and gave me such compelling arguments. I really don't know if I am right, and I continue to learn a lot on this thread, but my cost basis in AMZN is in the 20's and I like the tax treatment of long-term capital gains. Best Regards, Tom D