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$75.04 2.55 (3.52%)
7/8/2008 4:00 PM

Amazon.com, Inc. (AMZN)

CAPS Rating:
**

The Company operates retail websites and offers programs that enable third parties to sell products on its websites. It also operates other websites that enable search and navigation and a movie database.

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Avatar zcap (98.44) Submitted: 5/10/08 8:59 AM : Outperform Start Price: $73.00 AMZN Score: 11.45

Whe we play video games, we use Wii. When we listen to music, we plug in iPod. When it comes to books, we go to ... Amazon. Amazon started as a successful online book-seller. After all these years, it comes back to book-selling again - only this time they sell you a wireless-enabled electronic reader called Kindle. This 10-ounce device can hold hundreds of titles and allows you to purchase new books instantaneously. You can also read newspaper and magazines on it. Best of all, the screen uses a technology called electronic-paper, which make the reading no difference from real paper.
I take public transportation to work everyday. On buses and subways, at lease 50% of people are reading. Just imagine how popular this reader can become once people start to recognize it (and of course, if the price goes down a bit - it's currently selling at $400).
I have interviewed at Amazon before. It is an amazing place with amazingly talented people. The company is still young with great growth potential. Hence, I am not scared by its relatively high PE.

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Avatar TSMinerva (93.43) Submitted: 5/13/08 4:52 PM

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I agree that the Kindle is going to be the next big thing. I have to wonder who will be the first to copy it or try to control it? Doesn't it need some type of "carrier" to the the info to the Kindle? What's stopping the carriers (telecom?) from creating their own and cutting off the Kindle?

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Avatar zcap (98.44) Submitted: 5/15/08 1:02 PM

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Amazon's whipernet is built on Sprint network. This is one of the biggest advantage Kindle has over Sony reader.
I don't think any telecom company would be competing again Kindle, as this is not their core compentence. The Kindle business model is really great in that they don't just sell you a pricey electronic device, but they continue to make money because people are phasing more books from the Kindle stroe. Amazon has the recipe for the right mix of profit and loss when it comes to selling books. They purposely lose money on some books just to attrack people. The biggest challenge right now is that publishers (and authors) refuse to lower the price for e-books, but the days of their dominance is numbered.

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