To: Randy Ellingson who wrote (60679 ) 6/5/1999 1:37:00 PM From: Rob S. Respond to
I think Yahoo! and Amazon will get bid up again because they are leaders, the Internet is still in it's initial "great growth" stage and people tend to migrate toward leaders. But the market is also pushing past the early adopter stage in which there were relatively few players who really "get it". Even business people who might be typified as being “uncool suits” now much better understand Internet marketing. And the software infrastructure and development tools have dramatically progressed and along with it the skills of many programmers and developers. It is much easier, less expensive and mysterious to develop a competitive Internet site than it was two years ago or even just a few months ago. And the playing field is evening out at an incredible rate. One of the most dynamic aspects of the Internet is that it fosters a stupendous increase in knowledge sharing, evaluation, and cross pollination of software methods and strategies. As a consequence, software for the Internet is moving forward at "Internet speed".anal ysts said that Amazon had superior "Internet technology" that was said to be up to two or three years ahead of the competition. Amazon did have a nicely executed site backed up by a lot of well-interconnected server capacity compared to Barnes and others kludgy sites at the time. By last fall, Barnes and others had improved their sites to be about at a par in functionality and crispness as Amazon's and by now few would argue Amazon's technical superiority. In fact, some have started to present the possibility that other companies have developed superior or strategic technology that could have a negative or competitive influence on Amazon's business goals. For example, OnSale.com was granted a couple of basic patents for the methods of conducting online auctions and Priceline has patents on several ebusiness concepts. Does Amazon have a patent on ecommerce? There is increasingly a possibility that Amazon and others will have to pay royalties to others for auctions or other business ventures that use patented or copyright methods. That is just an example used to show the change in the perception of "technical leadership" that has already taken place. The environment will get much more competitive in the future, not less. And those companies that hold proprietary advantage will have the keys to the vault. One of those keys to profits is "Brand Name" recognition, but in a field that is technology driven and highly price competitive, other factors will have significant influence, although it's too early to tell just how much.
