BN.com Bows Out Of Ebook Sales
by Calvin Reid and Karen Holt, PW NewsLine -- Publishers Weekly, 9/10/2003
BarnesandNoble.com, once one of electronic publishing's biggest boosters, has shuttered its e-books store, citing low sales and saying publishers have depressed the market's growth by pricing electronic titles too high."Sales did not take off as we and many others expected," says Daniel Blackman, v-p, general manager of books, music and video for BN.com. He says the move will not result in layoffs.
BN.com's decision comes at a time when e-book sales are reported to be steadily growing, the number of retail outlets for e-books is increasing and a host of new reading devices are entering the market.
It was BN.com, in collaboration with Microsoft, that led the push to sell e-books when it launched an e-book superstore in 2000. Blackman says the market failed to grow for a number of reasons, including the fact that manufacturers have not yet made a device that consumers embrace on a wide scale. He points to the digital music market, praising the Ipod, the Macintosh developed digital music player, calling it "a real consumer electronics device. We’re not at that point with e-books."
He also blames publishers for not releasing enough e-books and charging too much for the ones they do release. "We think there has to be more flexibility in pricing in order to create an incentive for customers to buy an e-book instead of a printed book," he says. Blackman says BN.com may sell digital books again, "provided the market materializes for e-books."
Curtis Kopf, director of Amazon digital, responds to BN.com's decision by telling PW NewsLine, "Amazon.com is committed to e-books and to digital in general. E-books continue to be a rapidly growing business for Amazon. Asked about pricing, Kopf says, "We would love to see lower prices. We think lower prices are a great way to entice customers who haven't tried e-books to try them. It’s a relatively small business, but it's clearly something our customers want and it's growing."
Despite BN.com’s decision, e-book publishers and vendors contacted by PW NewsLine were quick to say the market for e-books continues to grow, albeit starting from a small base. Palm Digital Media, which offers e-books for the Palm OS, the dominant platform for reading e-books on handheld devices, cites steady, often phenomenal sales growth from month to month. "We’re selling about 1500 e-book downloads a day," says Mike Segroves, director of business development at Palm Digital Media, "and publishers are beginning to use promotional pricing to attract consumers."
Steve Potash, president of OverDrive, an e-book wholesaler, and president of the Open E-book Forum, calls BN.com’s decision disappointing, but was quick to emphasize the growth in the market. He points to retail sites like Fictionwise.com and noted expanding sales to public library systems. "More publishers are making content available, Microsoft is giving away promotional e-books to attract consumers and the back to school period is keeping us very busy," says Potash."
David Steinberger, president of corporate strategy and international at HarperCollins, says HarperCollins was not concerned about BN.com. PerfectBound, Harper’s e-book imprint, has, "clear and significant sales growth every month over a broad range of titles," he says. "The trend is clear and it has been very encouraging. We feel confident that we are seeing the beginnings of a potentially big market."
BN.com’s move will, "have no effect on Random House’s e-book program," says spokesperson Stuart Applebaum. "We’re undeterred by any one retailer’s commitment to the format."
