From the New York Times:
In March 2009, an eternity ago in Silicon Valley, a small team of engineers here was in a big hurry to rethink the future of books. Not the paper-and-ink books that have been around since the days of Gutenberg, the ones that the doomsayers proclaim — with glee or dread — will go the way of vinyl records.
No, the engineers were instead fixated on the forces that are upending the way books are published, sold, bought and read: e-books and e-readers. Working in secret, behind an unmarked door in a former bread bakery, they rushed to build a device that might capture the imagination of readers and maybe even save the book industry.
They had six months to do it.
Running this sprint was, of all companies, Barnes & Noble, the giant that helped put so many independent booksellers out of business and that now finds itself locked in the fight of its life. What its engineers dreamed up was the Nook, a relative e-reader latecomer that has nonetheless become the great e-hope of Barnes & Noble and, in fact, of many in the book business.
Several iterations later, the Nook and, by extension, Barnes & Noble, at times seem the only things standing between traditional book publishers and oblivion.
Inside the great publishing houses — grand names likeMacmillan, Penguin and Random House — there is a sense of unease about the long-term fate of Barnes & Noble, the last major bookstore chain standing. First, the megastores squeezed out the small players. (Think of Tom Hanks’s Fox & Sons Books to Meg Ryan’s Shop Around the Corner in the 1998 comedy, “You’ve Got Mail”.) Then the chains themselves were gobbled up or driven under, as consumers turned to the Web. B. Dalton Bookseller and Crown Books are long gone. Borders collapsed last year.
No one expects Barnes & Noble to disappear overnight. The worry is that it might slowly wither as more readers embrace e-books. What if all those store shelves vanished, and Barnes & Noble became little more than a cafe and a digital connection point? Such fears came to the fore in early January, when the company projected that it would lose even more money this year than Wall Street had expected. Its share price promptly tumbled 17 percent that day.
. . . .
Barnes & Noble, once viewed as the brutal capitalist of the book trade, now seems so crucial to that industry’s future. Sure, you can buy bestsellers at Walmart and potboilers at the supermarket. But in many locales, Barnes & Noble is the only retailer offering a wide selection of books. If something were to happen to Barnes & Noble, if it were merely to scale back its ambitions, Amazon could become even more powerful and — well, the very thought makes publishers queasy.
“It would be like ‘The Road,’ ” one publishing executive in New York said, half-jokingly, referring to the Cormac McCarthy novel. “The post-apocalyptic world of publishing, with publishers pushing shopping carts down Broadway.”
. . . .
Before Mr. Lynch joined Barnes & Noble in 2009, he had never sold a book in his life. (The last book he read — on the Nook, he said last week — was “The Spy Who Came In From the Cold,” by John le Carré.) Mr. Lynch came to the job from IAC/InterActiveCorp, where he worked for HSN.com, the online outlet of the Home Shopping Network, andGifts.com.
And yet, in three years, he has won a remarkable number of fans in the upper echelons of the book world. Most publishers in New York can’t say enough good things about him: smart, creative, tech-savvy — the list goes on. It helps that he has forged the friendliest relations between publishers and Barnes & Noble in recent memory. They are, after all, in this together.
. . . .
For all the bells and whistles and high-minded talk [at Barnes & Noble’s Palo Alto offices], Barnes & Noble doesn’t exactly have the cool factor (or money) of, say, a Google or a Facebook.
Ravi Gopalakrishnan, the first engineer whom Mr. Lynch hired and now the chief technology officer for digital products, said his techie friends were incredulous when he joined Barnes & Noble.
“They were all wondering what I was up to,” Mr. Gopalakrishnan, 46, said. “I’m a technology guy — why I was working for a retail company? They thought I was nuts. There were a lot of e-mails that said, ‘Barnes & Noble?!’ ”
Bill Saperstein, a mild-mannered surfer and a veteran of Apple, said he was persuaded to leave retirement to join Barnes & Noble as vice president for digital products hardware engineering.
“We don’t see a lot of the stock and the free sushi bar and everything else that you find at Google, but there’s a lot of responsibility,” said Mr. Saperstein, 62, who spent seven years working for Steve Jobs. “It was stuff that I strongly believed in, which was reading.”
. . . .
Back in New York, Mr. Lynch has been working to revamp the look of Barnes & Noble stores. Last year, the company expanded sections for toys and games and added shiny new display space for its Nook devices. In another sign of the digital revolution, Mr. Lynch expects to eliminate the dedicated sections for music and DVD’s within two years — while still selling some of them elsewhere in the stores. He also plans to experiment with slightly smaller stores. And, before long, executives will take the Nook overseas — a big switch, given that Barnes & Noble has focused almost exclusively on the American market for decades. The first stop is expected to be Waterstones bookstores in Britain.
. . . .
No wonder that some New York publishers have gone so far as to sketch out what the industry might look like without Barnes & Noble. It’s not a happy thought for them: Certainly, there would be fewer places to sell books. Independents account for less than 10 percent of business, and Target, Walmart and the like carry far smaller selections than traditional bookstores.
Without Barnes & Noble, the publishers’ marketing proposition crumbles. The idea that publishers can spot, mold and publicize new talent, then get someone to buy books at prices that actually makes economic sense, suddenly seems a reach. Marketing books via Twitter, and relying on reviews, advertising and perhaps an appearance on the “Today” show doesn’t sound like a winning plan.
What publishers count on from bookstores is the browsing effect. Surveys indicate that only a third of the people who step into a bookstore and walk out with a book actually arrived with the specific desire to buy one.
“That display space they have in the store is really one of the most valuable places that exists in this country for communicating to the consumer that a book is a big deal,” said Madeline McIntosh, president of sales, operations and digital for Random House.
What’s more, sales of older books — the so-called backlist, which has traditionally accounted for anywhere from 30 to 50 percent of the average big publisher’s sales — would suffer terribly.
“For all publishers, it’s really important that brick-and-mortar retailers survive,” said David Shanks, the chief executive of the Penguin Group USA. “Not only are they key to keeping our physical book business thriving, there is also the carry-on effect of the display of a book that contributes to selling e-books and audio books. The more visibility a book has, the more inclined a reader is to make a purchase.”
Link to the rest at the New York Times and thanks to Mary for the tip.
There’s a ton wrong with this story–I wound up blogging about it because it annoyed me so: http://marysisson.squarespace.com/blog/2012/1/29/more-funny-numbers-about-bookselling.html
I understand that the Times is based in NYC and feels an obligation to root for traditional publishers, but they rely on a bunch of BS numbers and wishful thinking, don’t talk to anyone outside the tradpub/B&N circle, and finish the story off by quoting the CEO of Macmillan saying, “Anybody who is an author, a publisher, or makes their living from distributing intellectual property in book form is badly hurt…if Barnes & Noble does not prosper,” which is certainly one of the funniest things I have read in the Times.
There’s a whole world outside the US full of readers and bookstores and books and yet the world ends when one US bookstore chain fails? Yeah right. Though I’d expect the CEO of Macmillan to know better, considering that their parent company is Holtzbrinck, a German publishing conglomerate.
“But in many locales, Barnes & Noble is the only retailer offering a wide selection of books. If something were to happen to Barnes & Noble, if it were merely to scale back its ambitions…”
In direct juxtaposition with:
“Mr. Lynch has been working to revamp the look of Barnes & Noble stores. Last year, the company expanded sections for toys and games and added shiny new display space for its Nook devices.”
‘Cause all those toys and games certainly help with the “wide selection” of titles one can ONLY find at B&N, and that’s not at all a “scaling back” of their core business. Oh, wait.
I like the Nook, but I have a kindle (early adopter). My wife has a Nook Tablet. We go to B&N all the time, which has a location about 15 minutes from my house. I hate what B&N has done to the stores. The entire center of the store is dominated by the Nook area, with everything else haphazard around it in their rush to get it operational prior to Christmas. Shelf space has been drastically reduced. It kind of reminds me of an oversized Newbury Comics store (which is a retail soter in New England that sells all sort of junk — with a very limited selection of comics).
Yes, I had a good laugh at the “wide selection of books” line, thinking about the ever-shrinking B&N bookshelves, which contribute to the death of the mass-line paperback, which, along with the emphasis on bestsellers–books that are published to succeed at all cost–contributes to the death of the midlist.
So more books published every year, and fewer shelves to sell them from. An ever-friskier turnover as more books come in from publishers to replace the wilting “produce.” If brick and mortar was your only book-buying choice, you wouldn’t see most of the titles released unless you brought a sleeping bag and camped out in the aisles. And they wonder why Amazon’s eating their lunch.
I think B&N bringing on Mr. Lynch is smart in a way but likely to be too little, too late. Obviously the big guns at B&N don’t know how to reach their consumers anymore so they bring in someone “tech-savvy” i.e. within the demographic they are hoping to reach to revolutionize B&N and help it stay alive. Whether it will work or not remains to be seen but they’re welcome to try. For me, I haven’t bought a paper book in 2 years (other than a few of my own for the sake of posterity lol). I’ve bought so many books on my kindle I can’t even keep count. Not to mention the ease of sampling a book’s first few chapters. Don’t like it, delete it.
The romantic idea of a physical book is getting eaten away by love of convenience and instant gratification, which no matter who you are, has a lot of appeal. Not to mention, it’s environmentally more friendly in a world with dwindling resources. Ten years from now, I think the question for everyone will be “Barnes and Noble who?” We already have Starbucks, Best Buy, Walmart, Toys R Us – is there room for yet another chain of stores that sell a mixture of consumer products? What’s going to be their Unique Selling Proposition then? We sell anything? Already been done several times over. The marketplace only has room for so much of that. B&N and the publishing world may have to face facts – they’re going extinct and that’s just the way it works sometimes. I’m sure the dinosaurs didn’t like it either.
I will note that Lynch’s tech pedigree is anything but gold-plated.
If Apple or Google received a résumé with the Home Shopping Network highlighted, many sniggers would follow.
I’m wondering if we’re hearing the real story on any of this.
From Wall St. news, it sounds like they are reorganizing to split off the dross. IMHO, the smart thing to do would be to shift the idiots into the print side, and cut ’em loose, while taking the real assets over to the Nook side.
And, of course, putting an idiot showman in charge would be the move to make. Make it look good to cover your exit.
At the same time, I think one advantage that Nook has over Amazon is the brick and mortar store. I know people who bought Nooks specifically so they would have some place to go when they can’t figure something out. And who like hanging out at the bookstore.
I think it would be a great idea to have a chain of Nookstores which are part Apple Store, part coffee shop.
When I first read this article a few days ago, this jumped out at me:
“Before Mr. Lynch joined Barnes & Noble in 2009, he had never sold a book in his life. (The last book he read — on the Nook, he said last week — was “The Spy Who Came In From the Cold,” by John le Carré.)”
It gnawed at me, until I realized that B&N brought him on-board to answer their the main question: How do we make more money?
Silly me, I would be asking, “How do I make a better bookstore?”
There’s a good take-away message in here for writers. Ask the right question and focus your energy on answering it. My question: How can I write a better book?
The publishers gnash their teeth over Amazon: “they don’t care about books, they sell books like widgets.” The publishers’ new BFF: the B&N CEO, who had never sold a book in his life before joining B&N.
I was interested that he got around to reading le Carre’ after the movie of Tinker Tailor Soldier Spy was released.
Wow, some much wrong in that article. The idea that working on an e-reader in 2009 was rethinking the future of books is just a little bit beyond silly into face-smacking stupidity. But my favorite part is this, one of the alleged impacts of the potential disappearance of B&N bookstores:
Uh, no. The end of bookstores should lead to the explosion of sales in the backlist as publishers would be forced to offer them as e-books and discover that they can make thousands times better profit on them that way.
Same thing struck me.
How old are these people? Is it that they never lived in a world where backlists were actually available? Have they never LOOKED at Amazon and noticed how many backlist paper titles are only there used?