Frank Hecker

Blogonomics: The Seeking Alpha Model

I remember when Seeking Alpha was spun out of Tech Uncovered (which I found through your article on ETFs). The site has come a lot way since then, and it's great to hear how it's doing and what the strategy is. I myself am among the smallest of small investors, but I have learned a lot from reading SA, especially about ETFs (still my main interest), things I don't think I could have learned anywhere else. (And of course it's also flattering that a couple of my comments got highlighted in articles, something I can't imagine happening anywhere else.)

Best wishes for the future success of Seeking Alpha! You really are pioneering a new medium here; see for example Marc Andreessen's recent blog post on the birth of newspapers for some historical perspective on both the difficulty and the importance of doing that.

The ETN Tax Advantage: Do Individual Investors Care?

Maybe there are two explanations here: Lots of individual investors don't even know what ETNs are and how they work, let alone any potential tax advantages they might have. (I was in this category until relatively recently, despite reading Seeking Alpha on a regular basis.) Of those individual investors who do know about ETNs and the tax advantages thereof, based on recent commentary some might likely be concerned that the tax advantages will be taken away by Congress and the IRS, and/or that individual investors using ETNs might be subject to additional IRS scrutiny, up to and including audits. Such people might be reluctant to be pioneers in terms of investing in ETNs, and prefer to wait until there's more clarity. (I'm in this category right now.)

3 ETFs I'd Still Like To See

What about frontier market ETFs, e.g., something that tracks the S&P/IFCG Extended Frontier 150 Index or equivalent? Maybe I'm missing something, but that stuff isn't covered by ETFs like EEM and VWO, correct?

Amazon Jumps On Plans To Sell DRM-Free Music Tracks

Oops, broke the links. Here they are again:

Hypebot article on Amazon announcement

Amazon-related posts at Swindleeeee!!!!!

Amazon Jumps On Plans To Sell DRM-Free Music Tracks

Ask and ye shall be answered. Hypebot has a good , with some rumors not in the press release. From that article and others:

"Have any of the other major labels agreed to do this?" No, although there have been rumors that at least one more major label will break ranks and offer DRM-free tracks through Amazon.

"Will the store simply not carry songs from major labels that don’t agree to sell music DRM-free?" Correct. Since this will almost certainly be positioned as an integrated offering with existing CD sales (i.e., downloads will be just another option, like paperback vs. hardcover for books), Amazon doesn't need to offer digital content for all major labels. Amazon already can provide complete catalogs on CD (digital is just a bonus for Amazon customers), so Amazon can just wait until other major labels see the light and offer DRM-free releases.

"What will be the pricing strategy?" Apparently Amazon will be undercutting the iTunes Store somewhat, but not discounting to the level of eMusic (which depends on a subscription model, not a la carte purchases). Hypebot claims album prices in the range $4.99-$8.99, per-track prices in the range $.89-.99. (eMusic prices are $.25-.33 per track, with albums averaging $2-3.)

"Exactly when will the store launch?" Hypebot claims June or July.

Hypebot has been doing a good job of keeping up with Amazon rumors over the past few months. I've also done some in-depth predictions of what Amazon might do in this space; see the Amazon category on my Swindleeeee.com blog.

P.S. Re the 12,000 labels: There are lots and lots of independent labels. Amazon is a long-tail retailer, and obviously wants to offer a very deep inventory.