A blast from the past: Why B&N was supposed to kill Amazon

[pwalker8]

Originally Posted by DiapDealer

Without the power to see what the future brings, I'm afraid you (and I) are entirely unqualified to determine what will ultimately count as "vision" in this regard.

You may end up being right, but right now, we have no idea in the least how successful (or un-) the future of drone delivery might be.

The point is that Amazon has always taken chances--have always experimented with cutting-edge technologies and practices in order to be ahead of everyone should some idea take the world by storm.

Vision is not always about seeing the future. Sometimes it's about getting your fingers in the pies of as many things as possible (as ridiculous or unlikely as some of those things may seem right now) in the hopes that a few of them become reality. Sometimes it will pay off and sometimes it won't. But one thing will always be true: you won't be an innovative company by waiting on technologies to be viable by today's standards before taking a serious look into them now.

I have no doubt whatsoever that there will be a lot of future whingeing about Amazon's "monopoly" on something everybody else originally saw as a pipe-dream, or a "solution in search of a problem." After all ... what's the difference between predicting a future and creating one, where business ventures are concerned?

That's not vision, that's just the standard investment strategy of spreading out your risks. A lot of companies do that. Vision is having an idea of where you want to go and figuring out a way to get there. Musk has the vision thing (Telsa and SpaceX) down, but perhaps not the execution thing down. Companies like Xerox, and the old AT&T with Bell Labs had fingers in a lot of pies thing down, but they didn't really have the vision thing down, so a lot of stuff just sat on the shelf waiting for someone else to pick it up and make something of it.

Certainly, I can't predict the future, but I can look at a Sumo wrestler and Ben Johnson line up for a 100 yard dash and make a pretty good guess who is going to win. Drones is one of those concepts that sounds cool, but when you start looking at the specifics, you start asking "why?". It's a bit like flying cars. The issue with flying cars isn't that they aren't possible, the issue with flying cars is that they aren't currently practical and don't really solve any real world problems. Same with jet packs. But they sound cool.

[DiapDealer]

If you see drone-delivery in the same light as flying cars or personal jetpacks, I can see why you'd feel the way you do. I personally don't think they're comparable at all from a logistics or practicality standpoint.

Let me ask you this: has the FAA taken any real proactive steps to regulate the use of flying cars or personal jetpacks? Or to certify/license their operators?

[ZodWallop]

Originally Posted by DiapDealer

Let me ask you this: has the FAA taken any real proactive steps to regulate the use of flying cars or personal jetpacks? Or to certify/license their operators?

They likely would if you could go to Best Buy and buy a flying car or personal jetpack, the way you can with a drone.

[DiapDealer]

Originally Posted by ZodWallop

They likely would if you could go to Best Buy and buy a flying car or personal jetpack, the way you can with a drone.

Exactly. Commercial (and recreational) drone use is a reality now. Nay not so for flying cars and jetpacks.

[fjtorres]

Originally Posted by DiapDealer

Exactly. Commercial (and recreational) drone use is a reality now. Nay not so for flying cars and jetpacks.

The jetpacks will probably need to wait for fusion pack power supplies. Neither batteries nor dinojuice have enough energy density for a practical jetpack.

But the flying cars (based on drone tech) are at most a decade away. Airbus is working on a literal air taxi.

https://www.theverge.com/2018/2/22/1...c-first-flight

In Brazil there is an entire industry of helicopter taxis in Rio. Affordable, too.

https://www.bloomberg.com/news/artic...-brazil-for-63

LA is another big city that could benefit from the service.

http://www.thedrive.com/tech/23261/u...service-launch

Not everybody gets it, but it's the twenty first century out there, with more future shock to come:

https://www.youtube.com/watch?v=Rl77FVobxVI

[bgalbrecht]

One of the problems with a disruptive technology, which "mail order over the internet" ultimately was, is that companies which are being disrupted rarely make the transition well enough to strongly survive. To a certain extent, it's because of poor execution, but I also think it's because the management has invested heavily in the original marketplace/technology, and are afraid to cannibalize the sales from it with the disruptive technology. Amazon could invest heavily in its website, and ebooks because it didn't have thousands of retail locations to protect. B&N needed a Nook to compete with Amazon, Sony, et. al., but if it was too good, and ebook readers were too attractive, and cannibalize too many print book sales, it hurts the B&N retail stores immensely. If the Kindle cannibalized print books, well, Amazon was already starting to sell anything and everything, and a warehouse is just a place where employees grab stock and package it for delivery.

[fjtorres]

Originally Posted by bgalbrecht

...but I also think it's because the management has invested heavily in the original marketplace/technology, and are afraid to cannibalize the sales from it with the disruptive technology.

That is exactly it.

The story of the IBM PC is the classic example.
The PC was created by an independent unit within IBM with no allegiance to anything or anybody in IBM other than their chief, Don Estridge. They were free to look at the market and deliver whatever it took to succeed without regard to what it might do to their mainframe, minicomputer, typewriter, or printer divisions. They succeeded spectacularly by doing things IBM would never do.

Then Mr Estridge died in an accident, the PC unit lost its independence and IBM started doing things the traditional IBM way. PC became PS/2, open became proprietary, and because they were more interested in serving the interests of IBM and not the interests of their customers they lost control of the market. A few years later they were out of the desktop computing business altogether.

B&N runs an online bookstore but its is not integrated with the stores. It is really a separate business that only shares its name with the stores.

Look at how Amazon runs its bookstores: they are extensions of the online store. They draw reviews and recommendations from their online customers. You can pay at the store using your online account or buy online from the store. If you're a Prime member, you get online pricing instore.

When it comes to pBooks there is only one Amazon.
B&N has never done that.
Probably too late to even try it now.

The thing about B&N crippling online and Nook to protect the stores is that it the stores have been in decline all along. They crippled their growth areas to prop up their fading sector.

[pwalker8]

Originally Posted by DiapDealer

If you see drone-delivery in the same light as flying cars or personal jetpacks, I can see why you'd feel the way you do. I personally don't think they're comparable at all from a logistics or practicality standpoint.

Let me ask you this: has the FAA taken any real proactive steps to regulate the use of flying cars or personal jetpacks? Or to certify/license their operators?

The two biggest uses for drones at the moment is as toys to be flown around like model airplanes and as camera platforms. They really don't have the payload to carry significant cargo. The major reason that the FAA has taken steps is that people like to fly camera mounted drones around in urban areas. It's the combination of peeping Toms and the risks of drones flying into things in the cities that lead the FAA to addressing the situation.

As delivery platforms, it's purely a novelty. Most drones that one sees have a lift capacity of around 2 to 4 pounds. There are heavy lift drones, though even then you are talking 10 lbs with a few that can carry 40 pounds. Most drones have a max flight time of 25 to 30 minutes. Heavy lift drones that can carry the 10-40 pounds are more in the 10-15 minute range. Then, of course, you need to stay in radio contact with the drone. For most drones, this is line of sight. Short flight time, low cargo capacity - I think that most can see the issues.

The military quality drones that have a long flight time and carry missiles are basically remote controlled airplanes and not suited to delivering packages, unless of course you are trying to blow something up.

[pwalker8]

Originally Posted by fjtorres

The jetpacks will probably need to wait for fusion pack power supplies. Neither batteries nor dinojuice have enough energy density for a practical jetpack.

But the flying cars (based on drone tech) are at most a decade away. Airbus is working on a literal air taxi.

https://www.theverge.com/2018/2/22/1...c-first-flight

In Brazil there is an entire industry of helicopter taxis in Rio. Affordable, too.

https://www.bloomberg.com/news/artic...-brazil-for-63

LA is another big city that could benefit from the service.

http://www.thedrive.com/tech/23261/u...service-launch

Not everybody gets it, but it's the twenty first century out there, with more future shock to come:

https://www.youtube.com/watch?v=Rl77FVobxVI

People have been using helicopters as taxis since the 50's. If you are going to redefine terms like that, then we have had flying cars since before WW II. The idea of a flying car, i.e. something that flies that anyone can drive only requires casual maintenance and doesn't require a large foot print to take off and land, still requires a propulsion technology that doesn't currently exist.

[pwalker8]

Originally Posted by fjtorres

That is exactly it.

The story of the IBM PC is the classic example.
The PC was created by an independent unit within IBM with no allegiance to anything or anybody in IBM other than their chief, Don Estridge. They were free to look at the market and deliver whatever it took to succeed without regard to what it might do to their mainframe, minicomputer, typewriter, or printer divisions. They succeeded spectacularly by doing things IBM would never do.

Then Mr Estridge died in an accident, the PC unit lost its independence and IBM started doing things the traditional IBM way. PC became PS/2, open became proprietary, and because they were more interested in serving the interests of IBM and not the interests of their customers they lost control of the market. A few years later they were out of the desktop computing business altogether.

B&N runs an online bookstore but its is not integrated with the stores. It is really a separate business that only shares its name with the stores.

Look at how Amazon runs its bookstores: they are extensions of the online store. They draw reviews and recommendations from their online customers. You can pay at the store using your online account or buy online from the store. If you're a Prime member, you get online pricing instore.

When it comes to pBooks there is only one Amazon.
B&N has never done that.
Probably too late to even try it now.

The thing about B&N crippling online and Nook to protect the stores is that it the stores have been in decline all along. They crippled their growth areas to prop up their fading sector.

Mostly I agree. I disagree with the asserting that the stores had been in decline all along. The B&N stores were in a strong growth all the way through the late 2000's. One could argue that the Nook came about as the stores were starting to go into decline, but back in 1997 when online was starting to be a thing, not so much.

[cfrizz]

Originally Posted by fjtorres

That is exactly it.

The story of the IBM PC is the classic example.
The PC was created by an independent unit within IBM with no allegiance to anything or anybody in IBM other than their chief, Don Estridge. They were free to look at the market and deliver whatever it took to succeed without regard to what it might do to their mainframe, minicomputer, typewriter, or printer divisions. They succeeded spectacularly by doing things IBM would never do.

Then Mr Estridge died in an accident, the PC unit lost its independence and IBM started doing things the traditional IBM way. PC became PS/2, open became proprietary, and because they were more interested in serving the interests of IBM and not the interests of their customers they lost control of the market. A few years later they were out of the desktop computing business altogether.

B&N runs an online bookstore but its is not integrated with the stores. It is really a separate business that only shares its name with the stores.

Look at how Amazon runs its bookstores: they are extensions of the online store. They draw reviews and recommendations from their online customers. You can pay at the store using your online account or buy online from the store. If you're a Prime member, you get online pricing instore.

When it comes to pBooks there is only one Amazon.
B&N has never done that.
Probably too late to even try it now.

The thing about B&N crippling online and Nook to protect the stores is that it the stores have been in decline all along. They crippled their growth areas to prop up their fading sector.

Fascinating history, and good example of what happens when people or businesses refuse to embrace change!

What I don't get is even with centuries of this happening over and over again with the same results, it keeps being repeated.

Are we really that stupid???

[fjtorres]

Originally Posted by cfrizz

Fascinating history, and good example of what happens when people or businesses refuse to embrace change!

What I don't get is even with centuries of this happening over and over again with the same results, it keeps being repeated.

Are we really that stupid???

Pretty much.
Mostly it's ego: it's easier to see stupidity in others than to accept it in yourself. Successful people get used to winning and stop questioning themselves. A lot of those execs take themselves too seriously and start to believe their own hype. They become one-trick ponies.

Riggio used to be a shark of bookselling on the basis of big storefronts, large(ish) catalogs, volume discounts, and undercutting independent bookstores. It worked for over thirty years. He became so used to being top dog he thought he was incapable of failing.

Then the market changed.
The change began at the turn of the century: 2003 was the peak of the old regime. It's been downhill since then. (No, it did not start in 2008. That was when they no longer could paper over the declining sales.)

If you look at Riggio's pronouncements these days, he still acts as if the downturn in B&M sales is just a blip. That somewhere out there is a magic solution that will bring back the lost traffic. He still won't admit that B&N hasn't just lost sales but rather has lost *customers*. For now and forever. They're never coming back.
Online isn't a bad dream.
Digital isn't a fad.
It's the new normal.

And the very things that made him--big storefronts, large(ish) catalogs, volume discounts, and undercutting independent bookstores--is precisely what is sinking him. The catalog size isn't a draw, the store size is dead weight, and his reduced volume no longer lets him underprice everybody. (Independents that survived his tactics learned to live without low prices, they learned new tricks. Their sales are small but so are their needs.)

One trick and he has no other.

He's not alone.
Plenty of other high flyers are in the same boat, just waiting for their pony to die. All it takes is one misstep. Once familiar names--Word Perfect, Lotus, Ashton-Tate, Borland--they all failed to diversify, build a stable of alternatives. Now they are but memories and shadows. Footnotes. Borders is one. Soon enough, B&N will follow.

Some are aware of the danger and are frantically trying to grow alternatives but many are too wedded to their own invincibility to accept the need for change.

Like I said, ego.
Human nature.
Times change, entropy wins and drama becomes farce.

[SteveEisenberg]

Originally Posted by fjtorres

Once familiar names--Word Perfect, Lotus, Ashton-Tate, Borland--they all failed to diversify, build a stable of alternatives.

Borland, for one, tried again and again to build a stable of alternatives.

Almost every buggy, and buggy parts, company tried to go into autos, or auto parts, and failed. Studebaker did make a good transition from making wagons to making motor vehicles -- for a few decades. But that measure of success was an unlikely outcome, just as successfully capturing the once shrinking, now growing (partly due to the high Amish birth rate!), market for horse-drawn vehicles and accessories was an unlikely, but possible outcome.

The great majority of new firms fail. If you push your existing firm in a radically new direction, that's pretty much the same as creating a new firm, and you'll probably fail (See: Nook).

[pwalker8]

Originally Posted by SteveEisenberg

Borland, for one, tried again and again to build a stable of alternatives.

Almost every buggy, and buggy parts, company tried to go into autos, or auto parts, and failed. Studebaker did make a good transition from making wagons to making motor vehicles -- for a few decades. But that measure of success was an unlikely outcome, just as successfully capturing the once shrinking, now growing (partly due to the high Amish birth rate!), market for horse-drawn vehicles and accessories was an unlikely, but possible outcome.

The great majority of new firms fail. If you push your existing firm in a radically new direction, that's pretty much the same as creating a new firm, and you'll probably fail (See: Nook).

Borland's issue was that when IBM paid them to write an IDE for the OS/2 operating system, they sunk too much of their resources into that and let themselves get overtaken by Microsoft in the Windows IDE category. Borland's focus on OS/2 caused several of their products to be late to market, something they never really recovered from.

The other thing to keep in mind is that Borland feasted on having low cost, well written IDE's that competed well against the massively expensive Microsoft developer's kit (which cost $1000 back in 1990, when I bought one). Once Microsoft started to react to the competition and stopped treating developers as a captive audience to be fleeced, they put Borland behind the 8 ball, since Microsoft could bring developer's kits to market for each new version of Windows much faster than Borland could. Once Borland went belly up, Microsoft reverted back to the extremely high priced developer's kits. When I finally dropped out of Windows development the SDK was back up around $1000.

[ZodWallop]

Originally Posted by DiapDealer

Exactly. Commercial (and recreational) drone use is a reality now. Nay not so for flying cars and jetpacks.

pwalker said it better than me in post #23. The FAA being involved in drones does very little to bolster the idea of them being viable for typical Amazon delivery of packages.

Maybe Amazon will roll out drone delivery one day, but if they do, I have a feeling it will be a novelty rather than anything standard. The people that pay $10,000 to purchase a gold Apple Watch can pay to have a drone deliver it.