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

To: Randy Ellingson who wrote (26472)	11/18/1998 12:04:00 AM
From: Glenn D. Rudolph	Respond to of 164684

LAS VEGAS -- Amazon.com Inc. Tuesday will begin selling videotapes, a much-anticipated thrust in a diversification drive that has rattled some rivals. The Seattle-based company, which became a huge Web brand by selling books, expects to start with a selection of 60,000 videos. Some will be offered at discount prices, to better compete with other Web video sellers such as Reel.com Inc. of Emeryville, Calif. Amazon also will sell digital video disks. Amazon has already expanded into music, and had been expected to move into videos since it purchased a British company called Internet Movie Database Ltd. in April. The acquisition last summer of a company offering comparison-shopping technology fueled further speculation that Amazon plans to sell a wide range of other goods, with computer software expected to be its next major target. Amazon's music foray is considered a success so far, with revenue in its first year of operation topping two established online music retailers, CDNow Inc. and N2K Inc. Those companies recently decided to merge, in a deal partly inspired by the desire to join forces against Amazon. Amazon, which is not expected to become profitable until 2001, is hoping to replicate that fast start by cross-marketing video products with books and music offerings. For example, sales of a tape of a hit movie could be promoted along with a novel it was based on, and the film-sound track CD. Nicole Vanderbilt, an analyst with the New York research firm Jupiter Communications, noted that Reel.com offers more video titles and has done a good job of acquiring customers. But Amazon has 10 times more customers, presenting a huge opportunity to sell multiple products to each. "If they can get revenue from each category, then they will start to see a return on what they are spending to get customers," she said.