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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Roger A. Babb who wrote (14450)	10/6/1998 11:04:00 PM
From: Market Tracker	Read Replies (2) \| Respond to of 18691

With this evening's announcement that Bertelsmann AG is buying a 50% stake in barnesandnoble.com for $200 million, we should see some downside pressure on AMZN IMO. dailynews.yahoo.com And as discussed in the irreverent style of Andrew Serwer of Fortune's "Street Life" column: "AMAZON.COM TO TAKE A HIT?... Here's the beef: Bertelsmann, the German media giant, is about to buy 50% of barnesandnoble.com. Remember the announcement about barnesandnoble.com being spun off, or IPOed? Forget it! Not going to happen now! BTW, barnesandnoble.com lost $30 million last year. Now Bertelsmann is putting up $200 million for a 50% stake. Why? To go mano a mano against Amazon. In this biz, Amazon has a 50% share; B&N's share is in the low teens. How is Bertel going to do battle? Well, first of all they OWN Random House, Bantam, Doubleday, and Dell--they're twice as big as the next biggest book publisher. So they OWN the books. Amazon.com doesn't own any. Second, they have infrastructure, like warehouses, forklifts (love forklifts!!), mailing centers, etc. Amazon.com has little infrastructure. So our German friends are just amortizing their overhead!!! My main man Marc Gunther wonders, "Isn't this a real challenge to Amazon?" Got that right Marco!! Watch Amazon stock tomorrow!!!!"