For lack of any better thoughts entering his tiny mind, The Register writer Andrew Orlowski has turned to controversy to get his name in print.
This self-sescribed "analyst" promotes splitting the technology side of Amazon (the group responsible for reselling Amazon technology such as the retail website engine and the means to populate it from external non-Amazon sources) and the retailing side (product sales).
Not stopping to think that the two are purposely inter-related... that the relatively newer technology business depends on the retailing side for investment funding, and that against the much bigger Google and eBay conglomerates it wouldn't stand a chance. Which would be just fine with him.
Orlowskis' original tiny thought: http://www.theregister.co.uk/2006/03/18/amazon_should_split/
This is the problem with these analysts: they print anything to get and keep their names in print. They have to be as outrageous as possible to get there in the first place... so the more rediculous the "analysis" the better. The problem is that it's irresponsible... and hurtful to the companies that are trying to establish their business. This plays directly into the stock market... where investors already "caffeinated" by analyst hype react by quickly moving on to the next-alledged-big-thing. And any stock which doesn't make it bigger and bigger - year after year - is no longer of interest.
Never mind the collateral benefits of Amazon - such as changing the entire book-selling market (despite the efforts of B&N). And especially changing the retailing market, where a handful of distributors control how you buy products and what you pay for them. Moving selling to the web is an enormous "democritizing" benefit to consumers because they can shop and decide for themselves without being tied into a geography (the city they live in) and a handful of vendors (stores at the local mall or in the same town).
Automobile dealers, as probably the leading example, don't want you to have freedom of choice and the advantages of a truly competitive marketplace. They want to control prices and only have a couple of local competitors to worry about (often owned by the same company). And they have had laws enacted in individual states to ensure you that you don't have that benefit. Remember the trouble that Jacques Nasser got into when he wanted to replace this system?
Speaking to the purpose of this site, as automotiove enthusiasts we should certainly be able to shop anywhere we want (even cross-country) for the best deal we can find - and then "just order it". Without having to go thru the hassle of dealing with outright unscrupulous (and unknowledgable) salesmen. But we're the exception here.. the real target of these people is the unknowledable consumer - the ones who aren't experts in the product they're going to buy or who can be easily swayed or worn down (how many of us has had our keys taken away while the salesman is consulting with the sales manager? This isn't a paradigm... it's the methodology!). The average consumer here is the real loser... and doesn't have the rights or means to do very much about it.
Which is why breaking up a company which changing the model of retailing is such a stupid idea!
You might suggest this is idealistic... and if you think it is then don't invest in these types of companies. But then you will have missed the investment opportunities resulting from the enormous increase in book sales over the past ten years... driven in part by Amazon empowering new buyers.
Here's a really useful Google service. As you may know, Google has been cataloguing basically every book with an ISBN that they can lay their hands on. The eventual numbers will be enormous.
