I’ve always loved books.
Going into a bookstore, browsing the shelves, finding something good – perhaps serendipitously (“Saving Fish From Drowning” was one such quirky yet memorable find) – make for a consistently pleasurable experience. Further back, when I was younger, I enjoyed finding good reads in used book stores in India (makeshift ones that were set up on sidewalks, on weekends, in commercial areas).
But as we all know, printed books are slowly but surely marching into oblivion, thanks to eBooks and eReaders. It probably won’t happen in 10 years or even 20. After 25 years, who knows?
(Above: From a used bookstore; NOT Barnes&Noble…)
Poor Barnes and Noble though. As recently as last year, its eReader division, the Nook, was valued highly (at $1.8 B and I blogged about it in a long article here). How things have changed since then.
Both its bookstore business and the Nook business have been experiencing declines (NYT article). The former, because of online competition and the latter because…of marketing? positioning? an insufficiently enticing ecosystem? competition from Tablets and the Fire? all of the above?
The Nook drew in as investors Microsoft and the British publisher Pearson, which collectively bought a 23 percent stake last year. And the division’s various offerings have won praise from critics, some of whom recommended the devices over Amazon’s.
But in three years after the first device was sold, the Nook still trails the Kindle, the iPad and other tablets. Barnes & Noble warned earlier this month that the division’s losses will have grown from the previous year, not decreased.
An analyst at Credit Suisse, Gary Balter, described Nook Media in a research note on Monday as “money-losing and increasingly poorly positioned.”
So what we have now is Leonard Riggio, who built Barnes and Noble into the 689-store behemoth (and presumably crushed many smaller independent bookstores in its time…link to an old, long New York magazine article on Mr Riggio has some interesting details on him and how he built B&N) getting ready to buy the physical stores (only).
This will accomplish two things:
1. It will dissociate the physical stores from the digital book business. Important because it appears that the Nook business was eating up a lot of cash from the bookstore business.
2. It will take the physical stores private…where Mr Riggio can re-structure them or do what he needs to (and wants to do), to prevent them from going the way of Borders book stores.
Isn’t that (#2), the question though? What will he do with the stores? No real clarity there…
The challenge for him is going to be – how do you create a model where you separate real book buyers from those that use the stores as a free library (who then go online to buy their books because they can save $1 or $2 per book?)?
Perhaps there will be a new radical re-think on how to monetize the space, by charging for access to space and WiFi…without alienating those that actually buy books. How about smaller stores that offer free coffee and WiFi, and charge annual membership fees – to be reconciled against actual book purchases? Maybe even “day passes” for occasional browsers?
Should be interesting to see what happens here.