E-book publishers were disappointed with Barnes & Noble.com's decision last week to stop selling e-books, but not overly concerned that it will slow the sales growth of the format. The head of one major house that publishes e-books said his company never offered its titles through B&N.com anyway because it felt the e-tailer's terms were unfair. Other publishers agreed that the B&N.com move would not change their e-book plans.
David Steinberger, president of corporate strategy and international at HarperCollins, said, "The [e-book] trend is clear and it has been very encouraging. We feel confident that we are seeing the beginnings of a potentially big market." B&N.com's move will "have no effect on Random House's e-book program," echoed spokesperson Stuart Applebaum. "We're undeterred by any one retailer's commitment to the format."
Companies whose primary business is e-books also said that B&N.com's change would have a minimal impact on sales. 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 1,500 e-book downloads a day," said 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 e-book wholesaler OverDrive and president of the Open E-book Forum, called B&N.com's decision disappointing, but was quick to emphasize the growth in the market. He pointed 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," said Potash.
The optimism of e-book publishers notwithstanding, B&N.com's decision came as a surprise, since the company had once been one of electronic publishing's biggest boosters. "Sales did not take off as we and many others expected," explained Daniel Blackman, v-p, general manager of books, music and video for B&N.com. It was B&N.com, in collaboration with Microsoft, that led the push to sell e-books when it launched an e-book superstore in 2000. Blackman said 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 pointed to the digital music market and praised the iPod, the Macintosh-developed digital music player, as "a real consumer electronics device. We're not at that point with e-books."
He also blamed 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 said. Blackman said B&N.com may sell digital books again, "provided the market materializes for e-books."
In an e-mail to consumers, B&N.com said customers had until December 10 to download titles they have purchased.
B&N.com's chief online rival, Amazon.com, is moving ahead with its e-book plans. Curtis Kopf, director of Amazon digital, told PW, "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 said, "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."