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  • earl417 earl417 Jun 28, 1999 8:18 AM Flag - 5% goes to charity, a affiliate has
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    purchases originating from its site to charity. This money
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    grants wishes to children who are terminally ill or have
    life threatening illnesses.

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    • Wow do you remember that days??
      the bubble come again

    • <EOM>

    • 2) <<Your 30%
      number ....... applies to
      very small transactions.>>

      * You have
      proved nothing by that statement. If someone can sell
      enough of 1$ items at a 30% profit that is a heck of a
      lot of money. The size of the transaction is doesn't
      account for the quantity of items sold.

      * You
      have still not explained your arbitrary 6% figure. You
      said you filched it from eBay. That is about as
      nonsensical as judging GM by fetching some number off of a
      Chrysler homepage. Or using Compaq's margins in place of
      Dell to judge Dell. Stop being ridiculous and admit
      your number is purely arbitrary.

      3) If you can
      not describe the joint site with sotheby's then you
      are not qualified to judge Kiggen's targets nor can
      you then justify your statements about long term
      outlook. Investors are responsible to assess

      Their are published figures as to the size of the
      dealer network under exclusive contract for the Internet
      through Sotheby's. The number is in the thousands. That
      you did not come across this fact or neglect to use
      it as it would destroy your thesis also descredits
      you post.

      4) Yes there are more points you
      evade. Your figure for subsequent quarters is extremely
      low and yet you fail to explain you tiny growth rate.
      Perhaps because thought you could sneak that one by

      5) Please don't tell us about the market leaders.
      BKS I believe was a market leader. Online Amazon has
      passed them up a long time ago. Amazon easily and
      rapidly surpassed the online leaders in video and music
      as well.

      Typical growth rates for Amazon when
      it enters a NEW category run between 2.5 and 1.9
      times previous quarter, on a quarter to quarter basis
      over the first two years. This is based on Revenue

    • Which Nemmy was responding? - the math and logic
      challenged one, I see. Yikes, where to begin?

      Kiggen did in fact call for $35 million in auctions in
      1999. He may have subsequently reduced this ridulous
      number to $20 million, but it's still

      2) 6% was an estimate for commission rate based on
      EBAY's 1998 numbers. Based on what I've read today about
      AMZN's "complex" rate structure, it sounds high. Your
      30% number was deliberately misleading as it
      apparently applies to very small transactions.

      3) I
      don't believe anyone can yet describe the Sotheby's
      site and how much AMZN's share of the commissions is.
      Sotheby's is the agent, after all, so presumably they would
      get the bulk of the commissions.

      4) There
      were only three basic points in your post, not six.

      I still believe the effect of AMZN Auctions will be
      negligble. I have not seen anything that supports the
      argument for $200-$260 million in revenue by 2003. EBAY is
      the First Mover and Market Leader and they only did
      $47 million last year. The space is much more crowded
      now, with UBID and PCLN and others, so how is AMZN
      going to go from a $2 million run rate to 100 times
      that in four years?

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    • Regarding auctions estimates, I Am Also Taking
      into consideration historic growth rates.

      earlier posted his estimate for the initial quarter of
      auctions of several hundred thousand which is in
      with initial quarter (that is those publicly reported)
      book revenues for 1996.

      We know that for the
      Internet in general, Amazon in particular, the first few
      years of a new category can
      produce exponential
      growth at a rate between 200 to 300% from quarter to
      quarter, as a quick glance at
      the SEC filings will

      Some will argue that there is all this
      competition. However, the higer-end market Amazon is
      (and Meg Whitman has even spoken to this in an
      interview with Upside Magazine) seems to be
      them of a specific advantageous niche. Also, I would
      say that overcoming (by building that
      similar 1996 base into a $1 billion category- well
      almost) competition with decades of experience

      between them like BGP and BKS for online market share was
      a much tougher feat than with their

      competition, which I acknowledge as strong, for auctions.

    • estimate for growth over the next several quarters. Kiggen gave his, you ought to be held accountable here as well.

    • if we consider the 200-300% quarter to quarter
      NEW CATEGORY growth such as Amazon experienced over
      the first couple of years in the book

      Your post contains the following inaccuracies or

      1) Your post neglects to cover due diligence on this
      important factor.

      2) Your 6% as you admit is an
      arbitrary number. Up to (and over) 30% is possible combined
      fee. Upon examination of the fee chart we can see that
      there are several types of fees. Listing fees,
      completion fees, additional charges for bold type, or
      featured link etc.

      3) You neglect to produce
      estimates for the joint Sotheby's site. Which already has
      thousands of dealers globally under signed agreements to
      sell exclusively (online) through Sotheby's

      4) The fee structure is complex and can not be
      accurately assessed through your model of 'average' price.
      Median prices may be more informative. Your comment on
      average price displays your naivite and poor
      understanding of the online auctions business.

      5) Fee
      structures for Amazon and eBay are not (nearly) identical,
      yet you, by your own admission are basing your post
      for Amazon wrongly on the eBay fee

      6) Mr. Kiggen's expectation was for $20,000,000 over
      the first few quarters and not the figure you

    • Hope you enjoyed your weekend. I took some time
      off, as well, got out of town for a bit.

      As I
      said, with the fee combinations (listing + commission
      on a sale + optional listing features) it is
      possilbe to see on some items fees of up to 30 or even
      40%. So your 6% seemed a bit curious to me.

      should understand that the fee structure is different at
      Amazon vs. eBay.

      Also, I would like to ask you
      about your comment of "generous" for your $50 per item

      This makes sense if we were applying a % to everything
      on an equal basis. However, if you examine the
      Amazon fee structure you will see that they can actually
      profit more from fees charged to lower-ticket items,
      depending on where that item falls in the fee structure
      chart. On a percentage basis.

      Why are you saying
      that $50 is generous? You should be focusing more on
      the fee I would think and not the item's

      I look forward to your explanation.

    • My post showed that even by using generous
      numbers, the revenues would be negligible. I see I have to
      repeat myself:

      Action items = 32,000
      = 100% every 2 weeks (generous - not all items are
      Commissions = 6% (generous)
      Average price = $50 (very
      generous, EBAY averages $30).

      These numbers work out
      to a current run rate of $624,000 per quarter, or
      roughly 0.2% of total revenues.

      Just a bit shy of
      Jamie Kiggen's $35,000,000 estimate for the year.

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