Feb
06
2013

Barnes & Noble heading for the rocks?

Mayyyyyybe:

Washington D.C.’s Union Station is a major point of entry for the nation’s capital. Streams of daily commuters from the region, tourists, and business travelers on the Amtrak circuit from Boston and New York can choose from an especially ample array of shopping and dining opportunities. But, as of the end of February, one of the anchor retailers will be gone. Barnes & Noble is shutting down its bookstore in a main concourse after failing to reach terms with the landlord. Browsing the aisles at Barnes & Noble stores has been a core feature of the chain’s strength in the forty years since Leonard Riggio purchased the assets of what was then a venerable seller mainly of textbooks and turned the enterprise into the country’s most formidable shaper of a superstore culture for book selling.

…of course, it was pretty clear a couple of years ago that the big-box booksellers were in trouble across the board; but it’s not apparently news until it affects the Imperial Capital.  Or perhaps I am being cynical.

Meanwhile, we have yet another plaintive paean to a 21st Century company stuck in a 20th Century business model:

We have been watching you for some time. You are the last hope of the brick-and-mortar bookstore, and at first we were optimistic. We love these places, with the pictures of Great Authors fraternizing on the walls. We attend readings there. We drink coffee there. We go to brick-and-mortar bookstores to do just about everything other than buy an e-reader. This is why your approach, lately, is so worrisome.

Well, Ms. Petrie, it’s probably because of this:

Twenty-four percent of people who bought books from online retailers did so after seeing them in real live bookstores first, according to a 2011 survey. Yes, this is irksome if you are the book retailer, but it’s critical publicity for the book. Lose the showrooms, and the Book suffers.

The problem here is that Barnes & Noble is actually in the showroom business, not the ‘Book’ business – and the reason why it pushes the Nook so heavily is probably because… well, as Ms. Petri put it:

“All right,” you may justly say, “but if you care so much about physical bookstores, why do you only go into them to buy coffee and sit for several hours using the free wifi without purchasing anything?”

…and the reason why Ms. Petri does that, and will continue to do that, is because Amazon.com can offer a significant discount and frankly has a hell of a lot more titles.

:pause:

This is turning into a fisking, and I don’t really like doing those all that much.  I’ll just note this: technology has improved to the point where people can carry around their casual reading on their communicators/tricorders cell phones.  I understand that the publishing industry used to make a good bit of money off of selling print books, nicely bound… but then, the music industry used to make a good bit of money off of selling recordings of musical performances, embedded into vinyl disks.  Evolve, or die.

Moe Lane

 

15 Comments

  • zamoose says:

    1) Our local B&N closed Dec. 31st. I wasn’t terribly broken up about it, but the nice ladies that always helped me find titles were basically sobbing messes for the Christmas rush, so that sucked.
    .
    2) I thought Best Buy was “Amazon’s Showroom”?

  • Spegen says:

    I recall the “Buffy” episode where Giles was chided for liking his library over using a computer. His comeback was regarding the smell that books have. I always enjoyed the experience of walking through B&N and just “looking”. Never knew what I would find that would strike me as interesting and worth buying.
    .
    With Amazon, I tend to count on people like Moe for recommendations for new books. Browsing through the catologue online is not nearly as satifying as wandering through a real book store. Problem now is that I prefer to read on the kindle vs a real book.

  • Evi L. Bloggerlady says:

    I discussed with with a few of the managers at a Borders when it was going out of business. They said the industry had changed, Borders was just slightly worse off than B&N, but they predicted this happening within two years. Seems like they were about right. It is a combination of the Amazon model being more efficient, poor management by both Borders and B&N, and the economic downturn.

  • Evi L. Bloggerlady says:

    The only problem with having everything digital is what if there is ever a wide spread collapse of civilization. Where does all that knowledge go? In a generation everything will be digital, including most libraries.

    • jbird says:

      Illuminated computer code copied over and over in obscure monasteries?

      • Wombat-socho says:

        This is addressed in the Raj Whitehall novels by Drake & Stirling, in which several references are made to the Fall Codexes.

  • zamoose says:

    In re: “Amazon”:
    I know that Matty “Y Not” “Yggdrasil” Yglesias is a bit of a by-word ’round these parts, but he actually did have something rather interesting to say in the wake of AMZ’s most recent quarterly filings:

    That’s because Amazon, as best I can tell, is a charitable organization being run by elements of the investment community for the benefit of consumers. The shareholders put up the equity, and instead of owning a claim on a steady stream of fat profits, they get a claim on a mighty engine of consumer surplus. Amazon sells things to people at prices that seem impossible because it actually is impossible to make money that way.

    So who will eat Amazon’s lunch, and when, and which Central Committee member[s]'[s] spouse[s] will be co-owners of it?

  • Luke says:

    Hey, it didn’t have to be the Imperial Capital.
    New York City would have gotten their attention as well.
    .
    I love my kindle, but physical books are preferable in nearly all ways (except for my wife putting a strict limit on the amount of bookshelves and types of books I’m allowed to have in areas of the house that company might see).
    Especially when some publishers think I should pay as much for a license to read a DRM digital file, as to own an actual, physical, durable object.
    .
    The downside, is that the chain bookstore has limits on the amount of books they can stock, and what they stock them with is decided at regional headquarters, rather than by local managers more in touch with the desires of the customers they serve.
    If I have to pay you up front to order a book for me, I’m just going to go to Amazon, and order it myself. I’ll get it faster, and it’ll cost me less.

  • Catseyes says:

    In a generation having a physical library at home will be a sign of wealth. A digital library not so much unless it’s in a hardened EMP proof case with hardened access port.

  • sicsemperstolidissimum says:

    Times of economic difficulties always hit the marginal more strongly. Talk all you want about helping the poor, if at the same time you are hurting the economy enough, you are hurting the poor, on net. Obama et al appears to be having a significant enough effect on the economy.
    .
    It isn’t surprising that this has an effect on the entertainment industry. As with every other sector, there is a variation in how well the businesses and companies are run. The economics of anime and manga are apparently so bad that I’m surprised we haven’t seen more contraction there.
    .
    English language fiction. There’ve been signs for years about issues, not all of which are technology and consumer change driven. On the publisher end, I’ve been hearing a lot of noise about certain defects in internal decisionmaking. On the bookstore end, B&N and Borders gained their competitive advantage in the first place with the large, centralized economies of scale thing. However, as has been shown since it became a management fad in the sixties and seventies, centralization tends to come with certain fallacies of organization. (I seriously blame communist influence for the fad. There seem to be some commonalities of core assumptions. Also, a lot about what people to when they complain of modern corporate America can be traced to this fad.) In this case, centralized buying has issues when it comes to fiction. Both because of using computer models to do it*, and because really screwy assumptions are easily fed into said models.
    .
    Amazon seems to have a better handle on their computer models. Amazon combines not having the issue of being unable to find something with very reliable customer service. It is natural that they would pick up business. BN has tried to match them, with some success, but they have not done as well as Amazon.
    .
    As for Amazon itself, I suspect that enough economic downturn, or an increase in poor decisions could sink them. I suspect the investors are willing to take a wallet hit in the short term, for the sake of Amazon’s reputation, infrastructure, and market position in the long term. The general economic issues may be resolved at some point, after all.
    .
    Amazon is still making changes to how it does business. Some of these may see increasing fruit in the long term, whatever happens with economic conditions.
    .
    People who follow Baen will have noted the changes in Baen E-Books recently. This is due to an agreement with Amazon, that will probably do good things for Amazon’s business. I expect that Amazon is otherwise looking to improve its position, some of which will further kick in.
    .
    That said, low information voters, especially the young ones, may have a heavy interest in entertainment. If voting for Obama elects Obama, Obama wrecks the economy, and economic issues hurt entertainment, actions have consequences.
    .
    If BN dies, I’ll probably miss them. But maybe then they will stop spamming me with deals on books that I have neither the interest or the money for.
    .
    *All models are wrong, but some are useful. Part of learning numerical methods for problem solving, which is a basis for computer models, is how easily the things go haywire if you don’t take proper care, or just fail to notice.

    • Wombat-socho says:

      The Baen/Amazon agreement will get Baen e-books into a wider market and give authors a bigger piece of the action.

      • acat says:

        Also, Wombat, the Baen/Amazon agreement provides a model for other fiction publishers.
        .
        That, I think, is going to be the part to watch. There was enough pressure on TOR for e-books, at one point, that they put a few titles up on webscription.net .. until then a Baen-only club.
        .
        Now, with a model and the Amazon name, other publishers may take the plunge.
        .
        Mew
        .
        .
        .
        p.s. yes, in the future, a physical library will be a sign of wealth. I just lost a small fortune to a bored dog…. chewed at least 10 titles, two to the point they’re going in the recycle bin.

        • sicsemperstolidissimum says:

          My wild uninformed guess is that the whole reason for the per unit price increase* was so that Amazon could have a working model to reference, that they could hope would be palatable to the other publishers.
          .
          Won’t help if the other publishers conclude that Baen and Amazon are so double plus ungood that following their example would be a thought crime.
          .
          (I’ve heard that some of the publishers have issues. Back when I was studying the subject, my teacher said that something like 95% of American companies were varying degrees of influenced by the above fad. (It may have been companies of a certain size. Also, the first cite for the metric may have been from the eighties.) Six big publishers, assuming severe issues are very common, how likely is it that even one of them is not making some pretty poor choices? Also, there are other sorts of fads and fashions that may not be the most effective way to handle publishing.)
          .
          *Note, this isn’t in any way a /complaint/. I trust Toni and I am happy for Baen. I think the price increase was a significant part of why the fraction paid to the authors was increased.

      • sicsemperstolidissimum says:

        My understanding is that the deal gets Baen an additional esales outlet, and amazon another low cost income stream. What Baen pays to the authors is a seperate result, not part of that deal itself.
        .
        I neglected covering Baen’s interest because I trust Toni to handle that, and because the focus of the piece was on Amazon.

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