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Originally Posted by Kali Yuga
Argh, Andrew H. beat me to the punch. At any rate... 
Yes. $600 million worth of issues.
And really, how much faster could they have gotten into it? B&N, which had a string of profitable years and thus greater resources, only started shipping in November 2009; Borders was only about 6-8 months behind. |
When that 6 months includes Christmas (which often represent half the sales a retailer makes in the year), it can be significant. It also is 6 to 8 months more that you are allowing your competitors to carve a bigger niche of the available market for themselves. And even once they did get the Kobo out (though they carried the Sony readers for years), they didn't really start effectively promoting it in stores until just before Christmas this year. By then Nook had been out a year, the Kindle for what, 2 years? All the early adopters had already gotten ebook readers. And lets remember early adopters often have a significant impact on what their friends and relatives end up getting.
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Let's face it, ebooks were the red-headed stepchild of the book biz until the iPad came out. The idea that Borders should have spent millions building a device and an ebook store in 2007, when they were already losing money -- well, that's just not realistic.
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I don't buy that. The Kindle still dominates the eBook business. Yes, in the minds of some, Apple's release of a tablet somehow legitimized ebooks, even though Apple didn't even bundle ebook software with the initial release of the iPad, but eBooks were already here and legitimate long before the iPad, and the eInk readers still remain the choice of someone looking for a device specifically to read.
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It's also not their method. For years, Borders used Amazon as a back-end for their online book sales; they only launched their own website in... 2007? 2008? They did the same with ebooks, partnering with Kobo instad of rolling their own.
And numerically, I don't see how an earlier entry would have helped. In 2006 -- their last profitable year -- they made $100m in profits off of $4 billion in revenues. They're down to $2.8 billion in revenues now; and I really don't see how a new ebook venture, competing against Amazon and Apple and B&N and Sony and everyone else, was going to capture nearly enough revenue to reverse that slide.
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The key is, they shouldn't have gotten in for Christmas 2009, they should have been working on getting in Christmas 2008. They have been selling Sony readers since the days of the PRS-500. But their ebook strategy has always been unfocused (still lacks focus actually). The Kindle didn't take off because Amazon sold it, the Kindle took off because Amazon made a good reader and then focused on it while the market was still very young. Borders could have been that company.
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While I fully agree that moving forward book chains are unlikely to survive without an ebook strategy, I see no compelling arguments that Borders would have avoided bankruptcy if they got into ebooks earlier.
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It all depends when and how they had gotten in.
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Bill