NEW YORK (Reuters) - Recent technical glitches have stopped some
holiday shoppers from completing purchases at Amazon.com Inc. but the
Web retailer's sales are unlikely to be hurt unless the problem
persists, analysts said.
The biggest problem occurred last week, when the popular Web retailer
had an outage that lasted for more than half a day and made its site
virtually unavailable to one in five users, according to Keynote
Systems Inc.
Gomez Inc., which tracks Internet shopping, said it found sporadic
outages at Amazon the week after Thanksgiving and last week. Last
week, Gomez found it was unable to complete a transaction on Amazon
about 12 percent of the time it tried, according to the firm's data.
"There have been a number of glitches," said Donna Hoffman, a
management professor at Vanderbilt University and co-director of its
Sloan Center for Internet Retailing.
Amazon is considered "the gold standard in the industry. The concern
is that if they're having problems, then what does that mean for the
rest of the industry?" she said.
Hoffman said, however, that even if Amazon shoppers have encountered
technical problems, most of them would be likely to come back to the
site and complete their shopping after the glitches are resolved.
The site experienced an outage a week ago, Amazon spokesman Craig
Berman said. "We have very sophisticated complex systems that have
problems from time to time."
However, no further problems have come up since then, he said. Berman
declined to comment on whether sales were affected by the outage.
Stock analyst Martin Pyykkonen, of Janco Partners, said the recent
outages have "probably been more than just insignificant" but that he
does not see the problem as being a drag on the company's overall
sales at this point.
"Obviously the whole volume still remains to be seen," he said of the
holiday shopping season.
Another analyst, David Garrity of Caris & Co., said he is not
surprised that Amazon would encounter some "stresses on the system"
during the busy holiday shopping season. He said the problems suggest
many people are using the Web site.
"It indicates very strong demand on the part of consumers," he
said. "These are the growing pains of the Internet."
Industrywide, online holiday spending so far this season is
on track to meet estimates, according to comScore Networks, an
Internet research firm. The Internet retail tracker said last
week that holiday shopping on the Web, excluding travel and
auctions, totaled $8.41 billion between Nov. 1 and Dec. 5, up
23 percent from a year ago.
Amazon Chief Executive Jeff Bezos has said that the online retailer is
poised for record holiday sales, with MP3 players and digital cameras
leading the way as this year's hot gift items.
Amazon shares rose 78 cents, or 2 percent, to close at $39.83 on
Nasdaq.
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