$2bil up for grabs in CE channel

Analysts have calculated that the liquidation of Tweeters and the closure of 20% of Circuit City's stores means that $2 billion in consumer electronics business will be contended over by the remaining players.

According to Piper Jaffray analyst Mitchell Kaiser Sr., Best Buy could conceivably pick up as much as 30 percent of the approximately $2 billion that will be up for grabs, the Associated Press reported.

Looking at Circuit City alone, Credit Suisse analyst Gary Balter believes Best Buy will capture “well above” its 21 percent market share from the 155 liquidating stores, aided by the chains’ close proximity within the affected markets, he wrote in a research note.

Certainly in markets like Phoenix and Atlanta, from which CC is withdrawing completely, Best Buy should gain quite a bit. Where else can buyers go? (Though WalMart and Target will certainly grab a piece of the pie). In other markets, Circuit City will grab up some of Tweeters' former customers.

I think, though, it's time for me to write again about the longer-term effects of retail consolidation. This time I think I'll bring in some thoughts about whether a new administration might seek to reverse the trend. Give me a few days to ponder.