Buy.com runs with e-commerce portal plan

Buy.com today announced a name change, a merger with SpeedServe, an online retailer of books, videos, and soon music; and stated its intent to become the first "e-commerce portal."

Formerly called Buy.Comp and launched just one year ago, Buy.com claims to have sold $100 million in computer hardware and software in its first year. Founder Scott Blum said his store is booking $1 million a day in sales--perhaps $2 million with the addition today of SpeedServe's books and video.

"We think we will change the landscape not only of the Internet but of purchasing on the Internet forever," Blum said. "We are going to set the standard for Internet retailing by providing fully functional sites for everyone who wants to buy books, videos, games, computer products, and in the future, even cars."

Blum backs his bold talk with strong partnerships. In merging with SpeedServe, Buy.com picks up key partnerships with Ingram Entertainment, which distributes music and book titles and owned 88 percent of SpeedServe. With the merger, David Ingram, Ingram Entertainment chairman and the largest shareholder of Ingram Micro, the world's largest distributor of computer products.

In addition, Buy.com has $60 million in the bank from two separate investments from Softbank, which now owns 20 percent of the company. In the second investment, Softbank paid $40 million for 10 percent of the company, putting its valuation at $400 million.

Blum is sinking part of that cash into an aggressive advertising campaign, including a heavy TV schedule that launches tonight on ABC's Monday Night Football. The national network buy includes Friends and other top-rated network shows.

The $9.9 million campaign, which includes national radio ads and print ads in Ziff-Davis computer publications, runs in 1998, and Blum said the company will spend $25 million on brand advertising in the next 12 months.

Blum's avowed target is Amazon.com, which started in books and is now the top-selling music site after about three months in that business.

"We are truly the Amazon of the computer marketplace today. Our goal is to surpass next year in terms of daily gross revenue," Blum said. "By combining the two companies, we can more quickly become a destination site for buyers."

Buy.com is not Blum's first venture--in 1987 he cofounded Pinnacle Micro, a manufacturer of computer storage systems that, as Blum said, spent $15 million on an optical device that came to market too late.

Blum left the company 2.5 years ago. The publicly traded company was twice the target of shareholder lawsuits, which Blum said were settled out of court.