Founded in 1962 by Sam Walton, Wal-Mart followed an amazing pattern of success and growth, eclipsing all other U.S. department store retailers by the early 1990�s.� In early spring 2001, Wal-Mart enjoyed a huge market capitalization of over $230B, which was down from highs of nearly $300B in early 2000.� Over the last year, however, Wal-Mart had suffered a number of failures in its Internet-based operations, as it tried feverishly, along with many other traditionally �bricks-and-mortar� companies, to make a transition to the Internet.� As much of the commotion in the markets relative to the Internet subsided due to a slowing economy and a number of high-profile �dot-com� failures, Wal-Mart continued to experiment with it�s Internet presence and corporate strategy.� In this paper, we discuss Wal-Mart and its technical transition to the Internet.� First, we examine the company from a value chain and core competency perspective, to gain insight on what value the company brings to the table, both in its traditional and Internet operations. We give a synopsis of Wal-Mart�s recent and current online philosophies, and then turn to Wal-Mart�s strategy as it relates to the transition.� Finally, we provide an analysis of Wal-Mart�s prospects and recommendations for the future. Sources of Value�������� Wal-Mart had always invested heavily in infrastructure.� They were among the first to use point-of-sale Uniform Product Codes (UPC) scanning, and intra-store radio frequency (RF) transmission of product UPC and pricing information between central store inventory systems and personnel with scanners on the store shelves.� However, their most valuable infrastructure investments were made at a significantly higher level.� A satellite system connecting all stores was initially installed in 1983, and grew into a complex communication network that included all stores,