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Wal-Mart Eyes Amazon in Potentially Costly e-commerce Battle

(Nathan Layne – Reuters)

Wal-Mart Stores Inc. said that it would take a different approach to online growth than Amazon.com Inc. by using its large network of stores as distribution points.

But if the world’s largest bricks-and-mortar retailer is serious about competing more directly with Amazon - as it has suggested by testing a free shipping club - then it may have to spend well beyond a previously announced investment target on big distribution centers and other costs for its plan.

Because of the high growth rates, most analysts see merit in investing aggressively in e-commerce. But as Wal-Mart prepares to test a free shipping program aimed at undercutting Amazon on price, the prospect of competing with a rival that spends heavily on investments has raised some concerns. Click here to read more.