Quote:
Originally Posted by simplyparticular
B&N bungled things from the very first step in 2009 - buying Fictionwise/eReader, and doing NOTHING except make it more and more difficult to get e-books.
They paid good money for a "social-DRM", but completely ignored the well-developed ebookstore, robust apps and an early-adopter client base, and let it rot on the vine while they built a brand-new store of their own - devices, apps, and selection. None of which ever lived up to the eco-system they let languish.
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Ding. Ding. Ding.
I've been waiting to see if anybody remembered.
Fictionwise was the number two bookstore when B&N bought them, sold more and carried more titles than Sony. Biggest indie book catalog at the time. Best customer retention mechanism this side of Whispersync (micropay rebates).
That was half of their launch blunder.
The other half (in hindsight, mortal, but at the time "merely" a headscratcher) was shoehorning in Adobe compatibility.
You had a bookseller selling ebooks that could only be read on Nooks shipping an ereader that didn't need their store. That let people buy *their* hardware and buy books from Sony, Kobo, or any generic store.
That sort-of made sense when they sold the Nooks at market prices (like Sony, Amazon, and everybody else on the hardware side) with 40% markup.
Then, six months later, they completed the bungle by going to near-cost pricing, giving up the 40% markup for the magic beans of 30% Agency margins. Except agency was not universal and people who bought the Nooks could (and did) get their books elsewhere.
Lots of Nooks were sold outside the US, to markets that Nook even refused to sell books to. So, no hardware profits, no ebook profits.
And then, the other shoe; they mismanaged inventory, ordered a zillion STRs and the death spiral began. And that is where getting in bed with Adobe came back to bite them: with the Nook ebookstore fading, readers are perfectly free to get their ebooks elsewhere. Not only is their market share declining in a still growing market, their unit sales are declining. Very fast. Because bad news breeds bad news. And their walled garden has always had open gates so customers are free to go elsewhere. And they have: at their peak circa 2011 they commanded a quarter of ebook sales in the US. Now they are down to maybe 5%, possibly lower.
Most telling: they've never made money off Nook.
Even when they sold almost half as many books as Kindle.
(Yet we know from the DOJ report that Amazon has never lost money selling ebooks.)
My take is that if they had stuck with ereader and fictionwise (and Sony stuck with lrf), we'd be looking at a much more competitive world. Yes, ereaders would probably start at $99-129 instead of $49-79 and they would've taken longer to get there but we'd have three, maybe more, serious players in the ereader business.
Jeff Bezos owes B&N a hearty hug and a big thank you.