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Subject: Re: UKNM: VAT and trading locations
From: Steve Johnston/IMRG
Date: Tue, 22 Dec 1998 13:41:09 GMT

My main point about CDnow is that they are building a model that protects
their customers experience of the CDnow brand. I know that it is full of
holes if you look close, but as volumes grow, they are going to accommodate
the frailties of the marketplace in a manner that at times may undermine
part of their difference as a retailer - i.e. massively cheaper prices -
but in the long term will be scaleable on a customer retention basis.

On the legislative front, the likes of CDnow are setting precedents and
establishing some common sense so that, by the time bureaucrats catch up,
they'll have a relatively ordered marketplace in which to legislate. But
then I could be deluding myself about this last point.....In fact, on
re-reading it, the notion of bureaucrats catching up is plainly nonsense

Steve Johnston
Director of Development

07000 46 46 74

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