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Fine Art Moves to the Amazon

Stocks in this article: AMZNEBAY

NEW YORK ( TheStreet) -- It never ceases to amaze me what happens when successful entrepreneurs think big. Some big ideas float while others sink.

If this article's title had you thinking about what may happen next on South America's most important inland waterway, I've got good news for you.

There won't be any fine art vendors setting up concession on the banks of the Amazon River. This story is about the world's most successful online vendor getting ready for a new Internet concession focused on a very unique and profitable niche.

Amazon.com (AMZN), which will report its latest quarterly earnings Thursday after the markets close, will soon be offering rare paintings, prints and other one-of-a kind fine art to discerning clients.

Yes, you read it correctly: AMZN will soon be revealing a new site with works of art from around 100 galleries around the U.S. This summer has seen the Colossus of e-Commerce hosting fancy receptions in major cities like New York, San Francisco and its home town of Seattle to make a splash about it.

AMZN has been focusing lately on the higher-end markets where profit margins will be better. Investors familiar with the company know that this may be a switch from the old paradigm.

While e-commerce companies such as eBay (EBAY) have operating margins of more than 20%, AMZN seems content with hardly any operating margin at all.

The corporate philosophy to which CEO Jeff Bezos and company religiously ascribe is to take revenue and pour it into growth and new ventures. That's how AMZN became the fulfillment center for every imaginable product from food to fluorescent light bulbs.

It won't be easy to sell fine art on the worldwide Web. It seems intuitive that big-money collectors will want to see the painting before they buy. Perhaps what will sell the art is who the artist is and the gallery with which they're connected.

Apparently AMZN is enticing gallery owners with free membership. The king of online retailing will charge a tiered commission based on the price of the artwork offered.

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