Greg Drew: Geoff thanks for having us on tonight. It really should be a fun hour. It's really nice to be here. Looks like we have lots of great questions. Where do you want to start?

Geoffrey Kleinman (moderator): Ok let me start out with our first question : What are the advantages of locating an internet business in Oregon?

Greg Drew: Oregon has a great creative and technical talent pool which helps us grow the company and there is a big benefit to our customers because Oregon is one of the few states that does not have a state sales tax and therefore we are not required to charge sales tax in any of the 50 states.

Geoffrey Kleinman (moderator): Ever consider a frequent buyers style program?

Greg Drew: We have implemented a series of special promotions for our installed customers where our customers receive advance notice on our promotions and are only available to our registered customers.

Geoffrey Kleinman (moderator): I loved the free UPS shipping for my dvd player. How could you afford that?

Greg Drew: Large volumes of business have allowed us to negotiate great deals with our shipping partners.

Geoffrey Kleinman (moderator): What % of all 800.com sales are from DVD's?

Greg Drew: DVD sales are huge, but since we are a privately held company we are not at liberty to disclose specifics related to our sales. This category is showing no signs of slowing down anytime soon. We are very committed to providing you with the best this category has to offer.

Geoffrey Kleinman (moderator): Any plans for another big event like the 3 for $1 sale last December?

Greg Drew: Yes. We are big fans of aggressive promotions. Stay tuned for some things that will be coming up in the next few months. You won't be disappointed in us.

Geoffrey Kleinman (moderator): Will 800.com continue with its free shipping policy indefinitely?

Greg Drew: Our customers have told us they really like the free shipping offer. We plan to ship dvd titles for free for the foreseeable future.

Geoffrey Kleinman (moderator): Any plans to start putting out coupons like Reel.com on a regular basis?

Greg Drew: We have recently launched a coupon program that you will see us aggressively expand in the very near future.

Geoffrey Kleinman (moderator): Does 800.com plan to sell adult DVD titles in the future?

Greg Drew: 800.COM presently sells mature audience titles limited to non-X-rated material.

Geoffrey Kleinman (moderator): Has 800.com learned anything from the poor customer service from other online stores such as buy.com

Greg Drew: 800.COM has learned a lot about customer service from our customers. We track every request that customers make of us and try to respond as a company to these whenever possible. We welcome everyone

Geoffrey Kleinman (moderator): Do you see the incredible deals online increasing, remaining level, or tapering off as DVD goes more mainstream and profits stabilize?

Greg Drew: With regard to promotions, customers have told us they prefer personalized promotions that are really important to them and not just the large unfocused promotions some folks are doing. Our registered customers will receive the best promotions we have available.

Geoffrey Kleinman (moderator): What about PRICE-MATCHING?

Greg Drew: Our daily prices are very low. In order to preserve this low pricing across the board, we have decided not to price match for movies or music. We do price match for consumer electronics

Geoffrey Kleinman (moderator): Do you expect to offer DVD players in the $200 or less range by this Holiday season?

Greg Drew: We are watching the prices drop for many of the DVD models. We aren't sure what the price will be this fall but you can rely on us having very attractive prices.

Geoffrey Kleinman (moderator): With another DVD price war occurring as we speak (40% off pre-orders), where do you see the prices of DVD's going in the future?

Greg Drew: We will always have very competitive pre-release prices for selected items. Many of them will be up to and above 50% off suggested retail.

Geoffrey Kleinman (moderator): What is your all time biggest selling DVD so far?

Greg Drew: Pulp Fiction

Geoffrey Kleinman (moderator): Are you going to allow for preorders farther in advance?

Greg Drew: Up to 60 days on some titles.

Geoffrey Kleinman (moderator): Your site is pretty fast, what kind of servers is it running on?

Greg Drew: Compaq servers. NT OS. SQL database.

Geoffrey Kleinman (moderator): How do you feel about the eventual release of DVD-R players and their potential for piracy?

Greg Drew: We are reviewing upcoming technologies and are interested in upcoming DVD audio. Watch our site for DVD audio in the future.

Geoffrey Kleinman (moderator): You mentioned you have some exciting promo's upcoming. Can you give us any more details as to what those might be?

Greg Drew: I think everyone agrees that our promotions are already on the leading edge of what you find in the industry. we will from time to time come up with additional promotions that are a little zany just to keep things interesting. We don't want to tip our hand just yet but in the meantime you can rely on us for aggressive prices every week.

Geoffrey Kleinman (moderator): How many orders did you receive during your 3 for $1 special?

Greg Drew: We booked 100,000 orders in 13 days. We came to work one day and didn't go home for three weeks. These 100,000 orders had over 310,000 line items.

Geoffrey Kleinman (moderator): What's the story behind the name 800.com?

Greg Drew: We selected a name that was easy for people to remember, hard to mistype and could include a variety of product categories such as consumer electronics, movies and music.

Geoffrey Kleinman (moderator): Any plans to set up warehouses in Canada or other international locations?

Greg Drew: We have just enhanced our shipping methods so that we could serve the Canadian market better. We don't have any plans that we can announce today with regard to our international markets .

Geoffrey Kleinman (moderator): When will 800.com go public(IPO)?

Greg Drew: We don't currently have any plans to go public since we just finished our second round of private financing.

Geoffrey Kleinman (moderator): Can you tell us the percentage of DVD's you sell as compared to VHS?

Greg Drew: Our DVD sales are huge and ever expanding. Our VHS sales are growing as well.

Geoffrey Kleinman (moderator): ever plan to expand farther... like into books or auctions like Amazon?

Greg Drew: We are singlely focused on being the leader in home entertainment products and currently working on providing customers with everything they want to make an informed decision for consumer electronics, movies and music. We think that working on other categories would dilute our efforts in providing you with the premiere solution for this category.

Geoffrey Kleinman (moderator): Do you have any plans to list the number of DVD's you have in stock for a given title like DVD Express does?

Greg Drew: While we don't list the no. of SKU's we have in stock we do have a very accurate representation of whether a product is in stock at the moment and this is updated real time.

Geoffrey Kleinman (moderator): If you plan to serve Canadians better, why does it cost $57US to ship the Diamond Rio, which weighs as much as a DVD?

Greg Drew: The additional cost for shipping to Canada is not related to the weight of the object but to the value of the product. Our current policy is that all electronics valued at over $100 are shipped via a method that is trackable. This price includes that tracking plus the brokerage fees required of us to be included.

Geoffrey Kleinman (moderator): Will 800.com start renting DVDs, or do you think there is no so such market as online rentals?

Greg Drew: We don't have any plans to enter this market at the moment.

Geoffrey Kleinman (moderator): how many employees work for 800.com?

Greg Drew: We currently have 76 employees, most of whom are very dedicated and a little crazy. We have a very good time here at 800.COM

Geoffrey Kleinman (moderator): Will you carry DVD software for the PC at 800.com?

Greg Drew: Many of the movie titles we carry are enhanced with DVD ROM features. We are getting an increasing no. of requests for this and based on customer request we will likely expand our efforts in this effort.

Geoffrey Kleinman (moderator): On average how many DVD's do you sell per day

Greg Drew: This is the type of information we are not able to disclose now since we are a privately held company ... but it's lots.

Geoffrey Kleinman (moderator): First let me say your Customer Service Reps have always been outstanding; however, I'm wondering if there is any talk to expanding the hours that service reps can be reached?

Greg Drew: We are currently open 12 hours a day, M-F, and 8 hrs. a day Sat and Sun We are always watching our off hours activity and will expand our hours as the volume warrants. Please e-mail any specific suggestions you have to support@800.COM

Geoffrey Kleinman (moderator): What is your best selling DVD Player?

Greg Drew: Right now our hottest selling DVD player is the Toshiba SD3109, which comes with $200 worth of free DVD titles.

Geoffrey Kleinman (moderator): What DVD do you expect to have the best sales this summer?

Greg Drew: We expect to do well with Aliens, Enemy of the State and Saving Private Ryan. We look forward as does everyone to the eventual release of Titanic on DVD.

Geoffrey Kleinman (moderator): Do you plan to expand your DVD players to include other manufactures ?

Greg Drew: We have a no. of manufacturers DVD players on site with plans to expand that in the months to come. Stay tuned for some really excited stuff.

Geoffrey Kleinman (moderator): Greg, what is your favorite dvd?

Greg Drew: I love Top Gun, myself, but my family is sick of it.

Geoffrey Kleinman (moderator): Do you ever run into server problems with your homepage, and if so do they affect your business?

Greg Drew: We don't currently have any reported problems on our home page. Please send us a note if you experience any problems. We are constantly watching our traffic to ensure that we have very fast response on all of our pages. We have spent a lot of money to make it fast for everyone so please do let us know if it's not fast enough.

Geoffrey Kleinman (moderator): Is there any plans to include higher end line on electronics, i.e. Sony ES?

Greg Drew: We are constantly working to expand the product lines we offer to you including higher end models. This is consistent with our overall business model to provide full pre and post sales support for you and this compliments the higher end products very nicely.

Geoffrey Kleinman (moderator): Who represents your biggest competitive threats, the retail markets Target, Walmart, BestBuy, other online stores. Greg Drew: We actually don't spend the majority of our time worrying about the competition. We DO spend most of our time focused on providing a better solution to the customer. We're not kidding.

Geoffrey Kleinman (moderator): and our last question (before our give away...): When will HDTV become reasonably priced for the masses?

Greg Drew: HDTV like most technologies will continue to drop in price every year. We are anxious for the price to reach a range that is attractive to the mass market and we're hopeful that it gets there sooner rather than later.

Geoffrey Kleinman (moderator): thanks greg for joining us this evening we are going to be drawing the 10 lucky winners of Alien legacy boxed set

Greg Drew: Geoff thanks for having us. I want to extend an invitation for anyone that happens to be in Portland to stop by our offices and we can provide you with directions to the best brew pubs ski slopes and beaches Oregon has to offer. Until next time. Thanks so much.

Geoffrey Kleinman (moderator): and the winners are... jhansen Jeton Lockergnome RichardDVD fantasia Blake Shawn Mao gamer Ned_Vogler

Geoffrey Kleinman (moderator): Congratulations to the winners, thanks to Greg, and thank you all for joining us for another great DVD Talk Chat!