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Technology Stocks : OnSale Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Jim Duffett who wrote (3702)	2/16/1999 3:08:00 PM
From: j_b	Respond to of 4903

<<A few years ago we all looked at Amazon and said "neat site, but wait till Barnes and Noble decides to bury them">> I think you underestimate the long-term potential of an existing brick and mortar brand. It may take them significantly longer to figure out the internet, but B&N is moving steadily along, building usership for their site. AMZN is not dead yet (and may never be), but it also isn't profitable yet (and may never be). That being the case, who has more staying power, the company with positive cash flow or the company that bleeds cash? You have to take a longer-term perspective. However, that really doesn't address the point I was trying (and failing) to make. The reason I think the portals will take over the sell-at-cost market is because they will all be supplying the end-users with shopping robots. Some already provide those products, and their use will most likely increase as people learn how much money they can save using them. Those robots look primarily at price, and so far only include sites that pay to be included or otherwise explicitly provide access to their data. People tend to use the tools provided by their favorite portal, and the portals want to be "sticky", so they try to provide access to just about every web tool possible. Who do you think will be the first listing (and the lowest price) on the comparison? Probably not the competition. This is not a new business for the portals to enter. They already provide the comparison shopping and the links to the purchase venue. The only difference will be that the purchase site will still be owned by the portal. The portals can afford to have a small market share and increase it slowly over time. Can the ONSL's afford to slowly lose that share, when they aren't even profitable now? I am not saying ONSL will lose the battle or the war, only that their window to create a leadership position is very limited, and they don't even have the first mover benefit. I still think the potential is there, but I recognize the magnitude of the risks, and they are higher than I am comfortable with. Of course, I'm a C.P.A., and just about ANY risk is more than I'm comfortable with <g>.