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Lost in Cyberspace

Internet changing not only the how, but the what of many businesses

This article was originally published on January 26, 1999 by SignOn San Diego and Copley News Service.

Everyone is aware of the fact that the Internet is changing how businesses go about making money. Just about any company above mom-and-pop status now has a presence on the World Wide Web. And study after study shows the amount of online commerce is growing exponentially.

What is more interesting is that the nature of the Internet is influencing the very nature of some businesses.

One example is K-tel Records. Famous during the '70s for their late-night TV commercials hawking "Greatest Hits" records, the company is now on the Web ( – offering make-your-own CDs in addition to their standard releases.

Now, the idea of choosing the songs you want on your own CD isn't new – some record stores had offered kiosks that did the same thing. But choosing songs while standing in the middle of a crowded record store, with people in line waiting for you to finish, doesn't offer the same atmosphere as scrolling a list on your computer screen at home.

To be sure, this new feature isn't K-tel's entire business. They are, as mentioned, still selling their various compilations (heavy metal, love songs, etc.). And on the Web site, the company is now in the retail music business – it's an online record store just like is for books, where you can buy CDs online via credit card.

But the Custom CD feature on K-tel takes advantage of the Internet's strengths – the ability to sort and search large databases quickly, 24-hour access, complete customer control – to create a new line of business for the company that it would not be in without the 'Net.

K-tel's Custom CD offer isn't particularly complete – you're limited to the artists they have licensing rights to. So you can have Bobby Sherman on your rock disc but not Elvis. Still, they have thousands of artists available so your choices aren't exactly narrow.

On a much larger scale is Where K-tel is attempting to carve out a new market niche for itself on the Internet, the folks at are aiming to become the main one-stop shopping destination online.

Forget about the vs. Barnes & Noble war; is an entire online mall. Sure, they have books – a subsection of is devoted to books. As many as or B&N? Probably not – but most folks can find more than enough books at the smaller mall bookstores anyway. Likewise, their online music store may not have as many CDs in stock as Tower Records – but the smaller music stores in the mall with mostly Top-40 hits also do plenty of business, and that's what seems to be aiming for. also sells jewelry and sunglasses, perfume and cigars, luggage and housewares. It's all laid out with easy-to-navigate search windows on every page.

In the real world, no one store could successfully sell so many disparate goods. On the Internet, search engines and indexes make it possible to broaden one's inventory to take in, well, an entire mall. By locating on the 'Net, allows customers the ultimate ease of shopping experience – no pesky salespeople, no parking hassles, no getting jostled by insolent teen-agers.

Whether succeeds remains to be seen. What is certain, though, is that there will be more and more efforts like as companies find not only new ways of doing business on the Internet, but new businesses that could only exist on the 'Net.