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Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG) -- Ignore unavailable to you. Want to Upgrade?

To: peacelover who wrote (10337)	11/21/1998 7:52:00 PM
From: cicak	Read Replies (3) \| Respond to of 44908

Hi Peacelover. One area I think TSIG will soon be ahead of most it's rivals is that TSIG has a sound business model. This distinction will prove very valuable to TSIG shareholders over time. In fact, if this distinction becomes know in the investment community once a few deals are closed, TSIG shareholders will be WELL REWARDED. The key is that we will have a FAVORABLE business model. This distinction alone will be worth many dollars per share in TSIG in my opinion. Regards, Phil ===================================================================== Web's Wrong Song: Online Music Retailing Analyst: Alex Yakirevich (11/19/98) Don't bite. The online music distribution industry is poised for explosive growth between now and the beginning of the new millenium. According to Market Tracking, worldwide revenue from sales of music over the Internet will balloon to $550 million by 2000, from $28.7 million in 1997. By 2004, online music sales will increase to $3.3 billion. Sounds great. But the devil (and all his overheated minions) is in the detail. Market Tracking's findings tend to concur with current conventional wisdom. In fact, in anticipation of a strong holiday electronic shopping season, investors have already driven up the stock prices of leading online music retailers. Shares of CDNow (NASDAQ: CDNW) are up 71% since November 2, while the stock of N2K (NASDAQ: NTKI) jumped 90% during the same period. Is this optimism justifiable? No. Here's why. Troubled Business Model Pure play retailers, in general, have a troubled business model. These firms, which provide narrowly focused content, by definition, exclude a larger pool of potential customers. In order to boost traffic through their sites, they have to pay astronomical fees to Internet portals to the likes of Yahoo! (NASDAQ: YHOO) and America Online (NYSE: AOL), to place a barely noticeable link on a portal's page. Another payment method used by online "landlords" is a revenue sharing arrangement, under which an online retailer shares a percentage of its sales with a portal. High Costs Either way, an electronic music distributor encounters substantial costs of conducting business, which is why these vendors have yet to prove they can be profitable despite triple-digit top line growth. CDNow, for example, posted third quarter year-over-year revenue growth of 255%, while its losses widened by nearly 400% compared to last year. N2K, which recently said it plans to merge with CDNow, was a similar story. Stiff Competition Intensifying competition within the online music space puts additional pressure on the industry. The potential for reaching millions of music fans on the Net has already attracted participants, who until now had nothing to do with the online music business. Amazon.com (NASDAQ: AMZN) and Barnes & Noble (NYSE: BKS) announced their plans to enter the field. Moreover, K-Mart (NYSE: KM), a giant discount retailer, said it was planning to offer 100,000 music titles through its web site. And you can be sure that Kmart will price their discs aggressively. Bottom Line: Considering the unfavorable fundamentals of pure-play online music stores, the smarter way to benefit from expected growth in the industry is through Web portals, such as the cash-generating and profitable AOL which offers online music shopping and much more.