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

To: Lizzie Tudor who wrote (56156)	5/9/1999 9:49:00 PM
From: Miche Elle	Read Replies (1) \| Respond to of 164684

Michelle, I'd be careful about using AMZN in the same breath as DELL... >>>"value proposition with AMZN and DELL is that they apply tremendous automation resources to their supply chain and eventually squeeze everybody else out of business 1/2% savings on cos at a time"<<< The fundamental distinction in the value between the two is DELL most likely will never have to worry about inventory carrying costs, whereas the AMZN model is precisely the antithesis: inventory intensive. Now, when an inevitable recession does eventually come around, which co do you think will be better positioned to survive? Their "value propositions" are entirely dichotomous.

To: Lizzie Tudor who wrote (56156)	5/9/1999 11:29:00 PM
From: Bearded One	Read Replies (3) \| Respond to of 164684

At last, someone actually gives a real answer to my question. Michelle, Amazon is currently worth about 9 times the value of Barnes and Noble. It's worth more than every major bookseller combined. . the value proposition with Amazon and Dell is that they apply tremendous automation resources to their supply chain and eventually squeeze everybody else out of business 1/2% savings on cos at a time. Dell actually creates things out of raw materials. Amazon is nothing more than a middleman. Thus, Dell has the ability to add value and cut costs along many steps of creation and distribution, while Amazon's value is only in its Web site and location of storage areas. As has been shown, web site creation is relatively easy. Oh yes, and did I mention that bookstores are profitable? How is Amazon going to profitably sell a book much cheaper than a bookstore when you add shipping costs? Bookstores are efficient-- they ship hundreds of books to one location at a time, saving on shipping costs. If you want a book today you go to a bookstore. If you're willing to wait a few days, you can go to Amazon. Or Buy.com. Or barnesandknoble.com Or any of a bunch of websites. Where's the added value? As for Dell, there's a lot more room to make money while shipping a $1500 server than a $15 book. Shipping costs don't matter as much. And you can sell a warrantee on a computer-- not too much market for book warantees. The true comparison to Amazon is not Dell, but rather 1-800-flowers. Call from anywhere in the nation, and buy some flowers quickly and efficiently. They've been automating their supply chain for years. Are they worth $22 billion dollars? Have they knocked out local florists? Even with their crazy market cap I wouldn't be whaling on Amazon like this if they kept their original business model and stuck to books. They might learn how to make a few pennies. But by expanding so irresponsibly, they are demonstrating an intent to lose investor's money in a wide variety of fields and stretch themselves too thin to manage their losses.