What's a superficially conscious investor to do? (Zappomazon)

If you take a superficial view of the world, then today's news is certainly puzzling.

You see, there's a company called Zappos that's really cool because they use Twitter and stuff, and there's a company called Amazon that's really uncool because they sucked 1984 off of all of the Kindles. (Needless to say, this is a very superficial view of both firms; for example, Andrew Keen argues that Amazon was NOT "big brother" in its handling of the copyright issues surrounding Orwell's book.)

Regardless of how you view the two firms, how does one react to this news?

SEATTLE--(BUSINESS WIRE)--Jul. 22, 2009-- Amazon.com, Inc. (NASDAQ:AMZN) today announced that it has reached an agreement to acquire Zappos.com, Inc. a leader in online apparel and footwear sales that strives to provide shoppers with the best possible service and selection. The acquisition brings together two companies who share a passion for serving customers and whose customers benefit from cultures of innovation and long term thinking.

“Zappos is a customer focused company,” said Jeff Bezos, Founder and CEO of Amazon.com. “We see great opportunities for both companies to learn from each other and create even better experiences for our customers.”

Under the terms of the agreement, Amazon will acquire all of the outstanding shares and assume all outstanding options and warrants of Zappos in exchange for approximately 10 million shares of Amazon common stock, equal to approximately $807 million based on the average closing price for the 45 trading days ending July 17, 2009. In addition, Amazon will provide Zappos employees with $40 million in cash and restricted stock units. Subject to various closing conditions, the acquisition is expected to close during the Fall of 2009.

Following the acquisition, the Zappos management team will remain intact and Zappos will operate its successful brand, customer experience and unique culture of service independently with headquarters in Las Vegas, NV.

“We are joining forces with Amazon because there is a huge opportunity to utilize each other’s strengths and move even faster towards our vision of delivering happiness to customers, employees and vendors,” said Tony Hsieh, CEO of Zappos. “We will continue to build the Zappos brand and culture in our own unique way, and we believe Amazon is the best partner to help us do this over the long term.”

What a difference two months makes. This Tech.Blorge item was written in May.

It seems that Zappos has some aspirations well beyond their beginnings in shoes, and this is going to put Amazon directly in their crosshairs.

In what could end up becoming one of the largest all out battles in e-commerce history, Zappos, the online retailer famous for selling shoes and outstanding customer service, has launched a new “zeta” site. Accessible through their main menu on Zappos.com, the new portion of their site is going to be selling computers, camcorders, DVDs, Blu-ray discs and more.

After an excellent analysis, which those of us without a crystal ball would have no reason to question, the post concludes:

Only time will tell if this plan works, but it isn’t hard to imagine that it will. The only potential problem they may have is that “Zappos” has become synonymous with shoes, so it may take a while for them to train people to think of them for other things, but they have the time and the money to work on that.

I'm not sure if anyone anticipated that Amazon would buy Zappos. If someone made such a prediction, please post it in the comments.

And if you can predict what will happen to Zappos, please post that in the comments too. Amazon has been on an acquisition streak as of late, having acquired LexCycle (the Stanza people) and SnapTell within the past few months. Has Jeff Bezos been hanging around Larry Ellison or something?