Vintage tube looks and throwback books were passing ships that were fit to be featured this past week. Let's take a closer look.
You've got sweathogs!
If you've been dying to see how folks like John Travolta and Lynda Carter got their start, Time Warner (NYSE:TWX) has got a deal for you. As long as you're willing to put up with a few advertising gaps along the way, the company's AOL.com arm is providing free access to streamed vintage television shows in the Time Warner vault -- shows such as Welcome Back, Kotter and Wonder Woman.
OK, this isn't exactly Seinfeld or Everybody Loves Raymond, but that's the point. If a show isn't in syndication and is just collecting cobwebs in storage, why not put it out there and milk the trend toward cheaper bandwidth and a growing broadband audience?
The timing of AOL's new In2TV service is peculiar. It comes just as all three major broadcasting networks have brokered deals to provide downloadable versions of their hit shows for about a buck or two apiece. Before Apple Computer (NASDAQ:AAPL) has a fighting chance to transform the digital delivery of video content the way it did with digital music, here comes Time Warner giving it all away.
Then again, that's probably the point. AOL isn't trying to battle with the broadcasters as much as with Yahoo! (NASDAQ:YHOO) and Google (NASDAQ:GOOG). Both of those companies have been pushing their video content lately. The new AOL.com has also been pushing its video search functionality, but here is where Time Warner is doing the right thing: It realizes that Yahoo! and Google have rich brands and tech smarts but are content-poor. As silly as it may seem, after years of trying to make the mixed marriage of old-media Time Warner and new-media America Online work, it's finally paying dividends. Time Warner, the Motley Fool Stock Advisor recommendation with a rocky trading past, finally gets it, and it's so obvious. It's just as clear as Wonder Woman's invisible airplane.
Time to throw the book at book retailers
I'll admit it. I'm a sucker for a bookstore. Whether it's that cozy mom-and-pop shop that local artisans frequent -- and in my neighborhood, that would be the inspiring Books & Books in Coral Gables -- or the superstore titans, I find that swinging open the front door of a bookstore is a lot like pulling the rip cord on a parachute or revving up a wooden top: The potential for something exciting and random happening is just moments away.
However, I can walk into a Barnes & Noble (NYSE:BKS) or a Borders (NYSE:BGP) and put in some serious time canvassing the aisles, but more often than not, I walk away with only my car keys in my hand.
Apparently, I'm not the only one. This week, the industry's gargantuan bookends pulled up lame. Barnes & Noble's sales inched a mere 4% higher. A day earlier, it was Borders with just a 1% top-line uptick.
Many of us seem to be checking out the promising titles and then hot-footing it to the nearest online collection to save 30% to 40% off the cover price by purchasing the books online. Now, I realize that no quarterly-report overview should begin and end at the very top line of an income statement. Companies with slow sales growth can produce huge earnings growth if margins widen. However, in this particular case, the trend speaks for itself. The big chains just aren't attracting shoppers. They're not growing as quickly as the online merchants are.
That leaves me with two solutions for Barnes & Noble and Borders. The first would be to make sure that their books are priced aggressively and that they offer online alternatives. The second would be to initiate a cover charge. The problem is that the first one would decimate margins, while the second one would misjudge my sense of humor.
No, it's not pretty.
The headlines behind this week's stories:
Until next week, I remain,
Longtime Fool contributor Rick Munarriz loves to look back, even if it means he falls on his face going forward. He does not own shares in any of the companies mentioned in this story. The Foo l has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.
